After iPhone's China Launch, Is BlackBerry Next?

Posted by: Bruce Einhorn on November 04 (http://www.businessweek.com)

The China iPhone wait has ended, so now it’s time to obsess about another smartphone that’s pretty much missing in action in China, the BlackBerry. China Unicom launched its version of Apple’s iPhone over the weekend, with quite disappointing results. (See my colleague Olga Kharif’s blog here for more.) Now Research in Motion, which has a limited presence in the country through China Mobile, is hoping it has better luck. According to this Xinhua story, RIM has “entered into final stages of talks” with China Telecom, one of the country’s three state-owned operators.

China Mobile has offered BlackBerry to corporate customers since 2008. But China Mobile, the country’s largest carrier, is clearly interested in promoting its OPhone, smartphones powered by the Google-backed Android operating system. Since Beijing keeps a tight grip on the Chinese telecom market, RIM doesn’t have a lot of options. China Mobile is focused on its OPhones and China Unicom working with Apple. That leaves China Telecom. According to the Xinhua story, “the handset manufacturer plans to introduce more Blackberry mobile phone models to China, with trendy new functions such as touch screens and handwriting recognition, and install new services including fashion and entertainment, social networking software, and instant messaging.”

Given the underwhelming early performance of the iPhone, does RIM need to worry that Chinese will not rush to embrace the BlackBerry? Urban Chinese are some of the savviest cellular consumers around, frequently replacing their handsets, and they want the latest features at the lowest prices. One reason the iPhone isn’t a hit yet for Unicom, for instance, is the popularity of unauthorized iPhones that come loaded with more features than the legit ones offer. RIM won’t have to worry as much about competing with its own phones in the black or gray market, though. Strange as this might sound, RIM probably will find itself in a better position than Apple because the BlackBerry isn’t nearly as popular in China as the iPhone.