Blackberry Announces Will Brand Phones As Palm – Lightly Braised Turnip

By ADRIANA MARKS

 

Smartphone Maker Blackberry Dusts Off An Old Brand Name To Replace Its Struggling One.

 

At an abruptly announced press conference on Friday, Thorsten Heins, CEO of BlackBerry, described plans to recast the company’s branding around the carcass of a former smartphone marker – the erstwhile Palm.  Starting this fall, Blackberry will begin releasing phones using its new operating system and branded as Palm devices.  By 2015 all Blackberry smartphones will be branded Palm, and the ailing Blackberry brand and distinctive logo will be no more.

“Blackberry must evolve like a snake shedding its old skin and putting on slightly fresher skin,” said Heins.  “Palm’s glory days are far enough away to generate some nostalgia – like Atari for videogamers,” he added. 

For the use of the Palm brand, Blackberry will pay Palm’s current owner – tech giant HP – $27.3 million and 3.5 million shares of Blackberry stock.  The deal does not include any of Palm’s IP interests.

There was obvious reason for this bold move from Heins to recast Blackberry smartphones under a proven – and slightly more intact – brand.  The rollout of Blackberry 10 operating system has been stillborn, and the fallout has damaged an already tarnished Blackberry brand.

BlackBerry’s first quarter missed on multiple metrics as the company’s revenue and smartphone shipments failed to live up to expectations. Even worse, analysts were expecting a solid quarter based on channel fill.

The company reported a first quarter loss of $84 million, or 16 cents a share, on revenue of $3.1 billion. Adjusted loss for the first quarter, which excludes charges, was 13 cents a share. Wall Street was looking for earnings of 6 cents a share on revenue of $3.36 billion.

Santa Marino College marketing professor Gerald T. Wilkens said that the move may offer Blackberry a lifeline.  “Sometimes a brand just weighs you down,” he said.  “Even when the brand was fresh, there was never any connection between blackberrys and the devices which can lead to consumer confusion – am I buying a smartphone or a small fruit?”

What’s unclear is whether or not BlackBerry can convince people that Palm devices are somehow superior to Blackberry ones.  Also, Blackberry has many loyalists that may react negatively to the change.

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