Blackberry saved by Africa!

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This may seem like a strange hypothetical headline of the future.  Maybe it will be.

It is conceivable that the manufacture (RIM) of Blackberry smartphones is saved by the African market.  Why?

Here is my take on it.

I think it is safe to say that Apple, Nokia and Samsung (and possibly others) may have a better device with more services than Blackberry.  (I can hear the howls from the Blackberry execs already – hey this is my opinion.)  But there is a big difference between Blackberry and the other smartphones.  Let me lay it out.  The Blackberry proposition to the customer is that you pay a fixed fee every month.  For this you get the usual cellular services, calls and SMSing.  But you also get internet browsing and instant messaging with BBM.  This cost is defined and you can do everything you need to; Facebook, Tweet watch YouTube and so on.  The cost is fixed.  The other devices offer the same service but for these services you need to purchase a data bundle which is not necessarily fixed.  So the value in the offering from the other providers has potentially a larger cost to the consumer.

This is definitive – the consumer.  The African consumer has less purchasing power than any other consumer in the world.  Cellular services compete with the little pleasures of life like cold drinks (Coke and Pepsi) and luxuries like beer and cigarettes.  I don’t mean compete in the Western sense of competing. We choose how we manage our budget with thoughts like “I will buy less beer and get more data”.  Often the choice to the African consumer is I have 2USD – “I buy beer or airtime – I dont have a choice to cut back”.  For the African consumer this is an either or choice and they have to give up lots just to be connected to the world, an experience many of us don’t comprehend.

So enter the Blackberry proposition – a fixed cost with unlimited chat, no SMSing required, less phone calls and still connected to social hubs.  The value in the Blackberry proposition to the consumer is there.

I started out by stating that maybe this is a hypothetical headline of the future.  For RIM, I hope it is reality, but the problem facing RIM and the Blackberry offer is that the device will still have to improve as will the accessibility to the apps. They have time to still do this.  But Africa is moving; living standards are improving and more importantly, there is a massive telecommunications roll-out.  Costs are starting to come down.  If the costs get as low as they are in say India, then the cost of bandwidth may not be an issue for the African consumer.

Getting back to my point.  Africa may save them but they had better  move fast.  Improve the apps and build a proper development community, improve the device and innovate. Do it or we may never see the future of Blackberry anywhere!

Mike Backeberg – April 2012


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