Telecom Lead India: BlackBerry CEO Thorsten Heins sees a limited future for tablet computers.
“In five years I don’t think there’ll be a reason to have a tablet anymore,” said Heins in an interview on Monday at the Milken Institute conference in Los Angeles. “Tablets themselves are not a good business model.”
BlackBerry took a $485 million charge last year to write down unsold inventory after shipping around 150,000 PlayBooks in the third quarter of 2012.
Heins said in a January interview he’ll only consider a PlayBook successor if it can be profitable. He reiterated on Monday that a BlackBerry tablet has to offer a unique proposition in a crowded market.
It is not known whether BlackBerry will wind up plans for tablets.
In a separate interview with Bloomberg Television on Monday, Heins said he was optimistic about prospects for BlackBerry’s new Q10 phone, which sports a physical keyboard. It debuted over the weekend in the UK.
The company is counting on a wave of upgrade buying from BlackBerry users who prefer a physical keyboard to drive Q10 sales and help revive revenue growth, Bloomberg reported.
In a separate report last week, Wedge Partners said BlackBerry is probably scaling back Z10 production.
The Q10, set to go on sale in the U.S. in May, will sell through the four largest US carriers for about $249 on a two-year contract. While that’s $50 more than Apple’s iPhone 5, it is part of a strategy to target business users willing to pay more for a phone they think will boost their productivity, said Anil Doradla at William Blair & Co.
The success of BlackBerry Q10 and Z are important for the struggling firm to gain market share.
It’s important to note that BlackBerry – without enough smartphones to address the entire market – will struggle. BlackBerry is not planning any products in the mid range.
The company has steadily lost ground over the past three years to Apple and Samsung Electronics, which offered more compelling touch- screen devices. Samsung accounted for one-third of smartphone sales last quarter, while Apple had 17 percent, according to IDC. BlackBerry’s share fell to 3.2 percent in the fourth quarter and then dropped out of the top five in the first three months of this year.
