BUSINESS

BlackBerry will face noise from Samsung's latest smartphone as it launches in US

03/11/2013 10:36 EDT | Updated 05/11/2013 05:12 EDT
The launch of BlackBerry's new smartphones in the United States later this week, following its debut in several other countries, will put the company in direct competition with hype for a new device from one of its biggest rivals.

Samsung is expected to unveil the latest version of its top-selling Galaxy smartphone series on Thursday, just days before the new BlackBerry Z10 becomes available through wireless carriers AT&T Inc. and T-Mobile.

These close releases could leave smartphone buyers asking themselves, should I go with the new BlackBerry (TSX:BB) or the upcoming Samsung Galaxy S4?

An early 2013 launch had reassured that the BlackBerry Z10 had breathing space before other new phones hit stores later this year, including an expected new iPhone from Apple. But the anticipated clash of the two phones could spell out another challenge for the Waterloo, Ont.-based company, which formerly called itself Research In Motion.

Though details of the new Samsung phone won't be revealed until Thursday during an event at Radio City Music Hall in New York, rumours already suggest it will be slightly larger than its earlier version.

Another is that it will feature technology that tracks the user's eye and automatically scrolls through a website at the same pace as the user reading the page.

The Samsung Galaxy S4 is expected to be released sometime this spring.

Meanwhile, AT&T Inc. said it would begin presales of the BlackBerry Z10 touchscreen smartphone on Tuesday, leading up to an official release on March 22. The company said on Monday that the phone will sell for US$199.99 under a two-year contract.

Fellow U.S. carrier T-Mobile said it will carry the BlackBerry device for its business customers as early as the end of this week, though it did not provide details on the availability for non-business customers.

The phone is already available in the U.S. by Solavei, a smaller no-contract carrier, for about $1,000.

The keyboard version of the new BlackBerrys still does not have an official release date in any country.

BlackBerry shares gained 14 per cent, or $1.86, to close at $15.29 on the Toronto Stock Exchange, with nearly 11.4 million shares traded.

A perceived success in the U.S. smartphone market is seen as crucial for the new BlackBerrys. The U.S. is where Apple's iPhone is most dominant and where Android smartphones like the Samsung Galaxy S3 are gaining traction.

Last month, Samsung stepped up a campaign aimed directly at the BlackBerry enterprise customers, which are the business clients that have come to rely on the smartphone.

The advertising spots, which include one starring movie director Tim Burton, feature employees at a gaming company who deride older BlackBerry models for having a noisy keypad and an outdated camera.

Anecdotal evidence for the new BlackBerry sales continue to suggest that demand remains strong across various regions.

Jefferies analyst Peter Misek published a note on Monday which said the BlackBerry Z10 continues to sell well, with his retail outlet checks showing that it is sold out in many new markets.

"India has been particularly strong," he wrote.

"And we believe AT&T will heavily support the (new BlackBerrys) with it possibly becoming AT&T's preferred mobile device management partner across all channels."

BlackBerry chief executive Thorsten Heins also has said the BlackBerry Z10 is selling well in various markets, though he hasn't released any hard data. At a conference in Waterloo last week he pointed out that sales in India were surprisingly strong to the point that the company was running out of stock.

"We have shipped into the channels what we thought would be good for five days, and then you would normally replenish those channels," he said.

"And I got an emergency call from my manager from India saying, 'I'm sold out after two days.' So now we're scrambling to reload those channels and replenish those channels."

The company's latest quarterly results are expected to be released on March 28.