The smartphone market is confusing. A variety of cell phones offer smartphone capabilities, but many are more geared to helping teens share videos and snap photos than helping employees do their jobs. Sometimes smartphones are called PDAs--increasingly, there's less to differentiate the three device categories. To us, a smartphone lets you do e-mail, Web computing, make calls, and in some instances, run mobile applications. RIM was the pioneer with its business e-mail, and it's still the one to be beat, at least in the United States.
RIM, which introduced the BlackBerry PDA in 1999, supplied 53% of the 5.2 million smartphones shipped in the United States last year, followed by Palm with 31%, IDC says. Nokia had 5% of the market, and Samsung 3%. Motorola, No. 2 in market share for cell phones, has gotten serious about smartphones only recently. Smartphone vendors are constantly trying to leap frog one another with new models, features, and designs--RIM alone released 10 handset models this year.
IDC predicts 8 million smartphones will ship in the United States this year, up 54% from 2005. The U.S. market is markedly different from the global one. Devices such as Nokia's that ship with the Symbian OS dominate the global smartphone market--it has 67% market share worldwide--but trail in the States. The opposite is true of RIM, which ships half the smartphones in the United States but just 6% worldwide.
Can RIM hold its U.S. lead? Motorola and Nokia are charging hard with sleek, ergonomic cell phone designs. RIM has responded with its new BlackBerry Pearl and BlackBerry 7130g prosumer devices that are smaller and more phonelike than previous models.
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RIM plans to keep its lead through product innovation, co-CEO Jim Balsillie says. One example is the BlackBerry 8700c, packing an Intel XScale processor with speeds of up to 312 MHz, which debuted last November on Cingular's high-speed Edge cellular network and transmits data up to 135 Kbps.
The biggest threat to RIM is the Windows Mobile operating system, now on some smartphone models from Cingular, Hewlett-Packard, Motorola, Palm, Sprint, and others. Windows Mobile is less of a hassle than the BlackBerry operating system to integrate into Windows computing environments. RIM is aware of the risks of proprietary technology. One attempt to open up is its BlackBerry Connect, a service that lets Motorola, Nokia, and Palm smartphones receive BlackBerry push e-mail. RIM may have a hard time keeping up with all the new phones; it hasn't yet extended BlackBerry Connect to the Motorola Moto Q and the latest Palm Treos.
