BANGKOK - While BlackBerry-maker Research In Motion (TSX:RIM) claws for a diminishing market share in North America, the smartphone maker maintains a reputation in Southeast Asia that in some places harkens back to its glory days.
It's sometimes hard to remember that RIM was once the darling of the tech industry, with legions of addicted fans dubbing the device the CrackBerry.
For a reminder of those heady times visit Siam Paragon, the biggest mall in Bangkok and one of the largest in Asia. There the BlackBerry retail store is just steps away from outlets selling designer labels like Prada, Dolce & Gabbana and Lamborghini.
Indonesia is also a bright light, having become RIM's biggest market in Southeast Asia. The company holds roughly half of the local handset market and has been ranked the top-selling smartphone there for the past two years.
The BlackBerry also ranks as the No. 2 smartphone in the Philippines, and the No. 3 smartphone in Thailand and Malaysia.
But it is Indonesia, the world's fourth most populated country, that will likely play a key role in RIM's future as it struggles to launch its new BlackBerry smartphones in the fickle North American and European markets.
At the same time, the company aims to sell its older device inventory at a discounted price in countries that are just starting to adopt smartphone technology.
One of the unique characteristics of Southeast Asia is that, for many in the region, buying a low-priced smartphone is the only reasonable option, said Melissa Chau, a technology analyst for research group IDC based in Singapore.
"In general, in these emerging markets you've got a strong polarization of the really rich and the really poor," she said.
"Everyone who lives in the urban areas already has a smartphone. But how we bring phones to cities in more rural areas — especially with more affordable headsets — that's going to be the next frontier."
Indeed, RIM has proven it already has its finger on the pulse of emerging markets and has successfully marketed BlackBerrys as exclusive yet affordable in countries like Nigeria, where it is ranked as the No. 1 smartphone.
In Asia, executives believe that a similar opportunity is being mined by the company, particularly in Indonesia.
"It's quite a warm feeling walking around Jakarta because it's probably like New York five years ago in the sense that everyone is walking around with a BlackBerry," said Hastings Singh, managing director of RIM's south Asia operations.
"If you can afford a BlackBerry you have one. It almost is at that point."
In a perfect world, RIM's business model would have all of its current customers in Southeast Asia eventually graduate to its new premium-priced models that will run on the BlackBerry 10 operating system.
There's still plenty of space for smartphone competition in Southeast Asia, especially outside major cities where a notable portion of the population doesn't own a phone capable of Internet and email.
"The dynamics here are different from the western world, and I think that's something that is absolutely fantastic for us," said Urpo Karjalainen, senior vice-president of RIM's Asia-Pacific operations.
Selling older phones to smaller markets proved to be a temporary fix for RIM in 2012, as it tried to cut its losses amid the two delays of its latest devices, which are now expected to debut in the coming months.
The company kept its overall subscriber base growing for longer than many analysts anticipated, but even those numbers are starting to slip. In the third quarter, about one million users shifted away from the BlackBerry, and the company reported its subscriber base fell to 79 million.
BlackBerry subscribers anywhere in the world are valuable to RIM partly because each pays a lucrative monthly service fee to operate on the company's networks.
As RIM prepares to launch the new BlackBerrys in higher end markets — including countries like Thailand — the company is expected to move ahead with aggressive discounts for its older devices which it hopes could maintain or grow its subscriber base further.
A price cut would likely gain favour with local carriers because keeping the price of smartphones down in Southeast Asia is a priority. Hardly any telecom companies offer the type of subsidy programs that help North American consumers finance their higher priced handsets like the iPhone and Samsung Galaxy S3.
"The cost of the device is actually a pretty big deal here," said Chau.
"I think that's why RIM has been able to hold on in that area."
For RIM's investors, it will be important for the company to maintain its existing subscribers in emerging markets, as it makes a case to North American and European customers with its new line of devices, due early this year.
In its outlook, RIM said it expected continued pressure on operating results in its fourth quarter, which ends in February, and expects to post another quarterly loss.
In the meantime, the company is launching a feature on its BlackBerry Messenger chat program that allows BlackBerry users to transfer money between each other. The peer-to-peer banking system is called BBM Money and will be first tested in Indonesia.
Blackberry PlayBook Flops, Prices Slashed
The PlayBook tablet, which was the BlackBerry maker's answer to the iPad, went on sale in April 2011. Since then, <a href="http://www.huffingtonpost.com/2012/01/03/blackberry-playbook-price-rim_n_1181167.html" target="_hplink">RIM has lost $485 million</a> on unsold units. At the beginning of January, <a href="http://www.huffingtonpost.com/2012/01/03/blackberry-playbook-price-rim_n_1181167.html" target="_hplink">RIM slashed the price of all models</a> of its tablet to $299. The special pricing will last until February 4. PlayBooks, which come in 16, 32 and 64 gigabyte models, typically retail for $499, $599 and $699, respectively, <a href="http://news.cnet.com/8301-1001_3-57351162-92/blackberry-playbook-price-now-$299-for-all-models/" target="_hplink">according to CNET</a>. In November, RIM temporarily <a href="http://www.huffingtonpost.com/2011/11/22/blackberry-playbook-price-drop_n_1107941.html" target="_hplink">slashed the price</a> of the 16GB version of the tablet to $199 at certain retail locations.
In October, BlackBerry <a href="http://www.huffingtonpost.com/2011/10/13/blackberry-outage-2011-rim-says-services-returning_n_1008596.html" target="_hplink">suffered an outage that affected</a> many of its then 70-million worldwide users, leaving some of its customers in Asia, Europe, Latin American and Africa without service for as many as three days. Some users in the U.S. were affected, but not for as long a period.
Drunk Execs Disrupt International Flight
In December, two RIM executives were fired after a flight they were on was forced to be diverted because the pair's "drunken rowdiness," <a href="http://www.huffingtonpost.com/2011/12/02/two-men-face-hefty-fine-a_0_n_1125214.html" target="_hplink">the AP reports</a>.
BlackBerry 10 Platform Delayed
Research in Motion announced in December 2011 that its highly anticipated BlackBerry 10 platform won't be available until the end of 2012. <a href="http://www.huffingtonpost.com/2011/12/16/blackberry-10-phones-rim_n_1153314.html" target="_hplink">According to the AP</a>, the company claims the holdup is because the chipset needed for the phones running the platform won't be available until the middle of this year.
Stock Slides In 2011
In 2011, <a href="http://www.dailyfinance.com/quote/nasdaq/research-in-motion-limited-usa/rimm" target="_hplink">RIM's stock</a> dropped <a href="http://www.huffingtonpost.com/2012/01/23/rim-ceos-jim-balsillie-mike-lazaridis_n_1222605.html#s629929&title=Lessien" target="_hplink">a massive 75 percent</a>.
Falling U.S. Market Share
In less than a year, RIM's share of the U.S. smartphone market <a href="http://www.huffingtonpost.com/2012/01/23/rim-ceos-jim-balsillie-mike-lazaridis_n_1222605.html#s629929&title=Lessien" target="_hplink">dropped by almost 50 percent</a>, from <a href="http://www.comscore.com/Press_Events/Press_Releases/2011/3/comScore_Reports_January_2011_U.S._Mobile_Subscriber_Market_Share" target="_hplink">30.4 percent</a> in January 2011 to <a href="http://www.comscore.com/Press_Events/Press_Releases/2011/12/comScore_Reports_November_2011_U.S._Mobile_Subscriber_Market_Share" target="_hplink">16.6 percent</a> in November 2011. In 2009, <a href="http://www.huffingtonpost.com/2011/12/16/blackberry-10-phones-rim_n_1153314.html" target="_hplink">RIM controlled 44 percent</a> of the US smartphone market. (Pictured above is the HTC Desire HD Android, which runs on Google's much more popular Android platform.)
Investors Urge Company Sell Itself
A nearly 75 percent drop in stock price in 2011 did not please investors. At the end of 2011, Jaguar Financial Corp, <a href="http://www.huffingtonpost.ca/2012/01/03/balsillie-lazaridis-rim-research-in-motion-jaguar-financial_n_1180885.html" target="_hplink">one of the largest investors</a> in RIM, called "for substantial corporate governance change and for a sale of RIM, whether as a whole or as separate parts." Vic Alboini, the chief executive of Jaguar Financial, <a href="http://www.bbc.co.uk/news/business-16393180" target="_hplink">told the BBC earlier this month</a> that RIM has "lost it." "The party is over, we believe, in terms of trying to design that cool, tech savvy smartphone," he said. "Microsoft has over $50 billion in cash, RIM has $1.5 billion. There is no way they'll be able to compete."
The family of 11-year-old Kian McCreath of Coventry, U.K., gave RIM some of its worst publicity in 2012, telling the media the boy was burned and left with permanent scarring when his BlackBerry Curve 9320 exploded. Although cell phones that are left to charge too long are known to explode, for RIM the news represented a horrible publicity disaster that came just weeks ahead of the launch of its BlackBerry 10.