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On a day when AT&T has begun selling the BlackBerry Z10 (BBRY +0.6%), Deutsche's Brian...

On a day when AT&T has begun selling the BlackBerry Z10 (BBRY +0.6%), Deutsche's Brian Modoff is raising fresh concerns (previous) about U.K./Canada sales. "Over the past week two carriers in Canada have cut prices on the Z10, suggesting to us lessened demand and possible margin pressure ahead." Modoff says his team contacted 60 stores in its latest round of checks, and failed to find a sellout. Thursday's FQ4 report should provide some color on early sales. (Detwiler Fenton) (Morgan Stanley)
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Comments (49)
  • LYogi
    , contributor
    Comments (2263) | Send Message
     
    Z10 will likely be mixed as far as sales and expectations go but the Q10 is the bread and butter for blackberry.
    22 Mar 2013, 11:49 AM Reply Like
  • DIgitalMediaView
    , contributor
    Comments (668) | Send Message
     
    Did Modoff check Best Buy? Doesn't sound too mixed...

     

    Best Buy's head of mobile sales, Scott Anderson, regarding how the retailer has gauged demand for the Z10 in the US based on sales at Best Buy stores in Canada: "We have fairly consistently increased the allocation of it to our stores as it has got more and more buzz. Even though we aren't releasing any numbers, we do put this in the realm of a serious iconic launch."
    http://yhoo.it/11pxpUb
    22 Mar 2013, 12:07 PM Reply Like
  • jaych79
    , contributor
    Comments (506) | Send Message
     
    LOL when I first read Brian Modoff I thought it said Bernie Madoff.
    22 Mar 2013, 11:50 AM Reply Like
  • MoV1
    , contributor
    Comments (96) | Send Message
     
    hahaha but seriously they have a similar character. liars and cheaters
    22 Mar 2013, 11:54 AM Reply Like
  • Gene Chan, CFA
    , contributor
    Comments (232) | Send Message
     
    The phone has been out for 2 months now in UK/Canada. Any company with half decent supply chain management would make sure there's enough inventory.
    22 Mar 2013, 11:50 AM Reply Like
  • cereal
    , contributor
    Comments (757) | Send Message
     
    Even #3 HTC can't get their supply chain in order because Apple and Samsung demand the most attention from part suppliers. What chance does RIM have?

     

    But likely the demand for their phones will be low.
    22 Mar 2013, 02:59 PM Reply Like
  • mrgreek
    , contributor
    Comments (4) | Send Message
     
    Since RIM doesn't exist, they don't have a chance. Blackberry on the other hand can handle it.
    24 Mar 2013, 03:26 PM Reply Like
  • MoV1
    , contributor
    Comments (96) | Send Message
     
    Lol why would there be a sellout 2 month after launch???
    22 Mar 2013, 11:54 AM Reply Like
  • Noodlez
    , contributor
    Comments (191) | Send Message
     
    sorry, i have no respect for people like brian modoff. he just makes some phone calls (not even enough to make it call an empiric test), does some napkin math and distracts nervous traders, while receiving a good income from a solid financial institute? hillarious.
    22 Mar 2013, 11:57 AM Reply Like
  • gwynfryn
    , contributor
    Comments (4354) | Send Message
     
    Just a few more days, people, and we'll have the figures. Not much point speculating at this stage...
    22 Mar 2013, 11:58 AM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    Heh true, but the money is made by accurately guessing ahead of the numbers and placing your bets accordingly!
    22 Mar 2013, 03:58 PM Reply Like
  • gwynfryn
    , contributor
    Comments (4354) | Send Message
     
    Of course, gs, and you could as well have said: "but the money is lost by inaccurately guessing ahead of the numbers and placing your bets accordingly".

     

    Do you have a reliable basis for "guessing" in this example? I know I don't.
    23 Mar 2013, 09:21 AM Reply Like
  • MoV1
    , contributor
    Comments (96) | Send Message
     
    Hope this guy gets fired and investigated. crook
    22 Mar 2013, 11:59 AM Reply Like
  • Zzoot1
    , contributor
    Comments (205) | Send Message
     
    Agreed on Margin pressure ahead.... on Short traders' margin.
    22 Mar 2013, 12:01 PM Reply Like
  • Jislove
    , contributor
    Comments (14) | Send Message
     
    Time and numbers will all prove the truth.
    22 Mar 2013, 12:02 PM Reply Like
  • Cochise54
    , contributor
    Comments (364) | Send Message
     
    Brian, your short buddies have your back today....CNBC is actually mocking BBRY. Evil lurks in many places and forms. Long BBRY.
    22 Mar 2013, 12:05 PM Reply Like
  • cfezziwig
    , contributor
    Comments (436) | Send Message
     
    So when they sell out at a store its a problem for not supplying enough phones and if they dont sell out its a problem because they're not selling?

     

    The media and analcysts can't seem to make up their mind with non-Apple/Android phones?
    22 Mar 2013, 12:19 PM Reply Like
  • Charles_Martin
    , contributor
    Comments (36) | Send Message
     
    Sort of the kind of silliness we see with gold...and for that matter everything else. It's an ugly world.
    22 Mar 2013, 01:11 PM Reply Like
  • Shergar
    , contributor
    Comments (167) | Send Message
     
    The Takedown.
    all the anecdotes I have read in THE LAST FEW DAYS, from Canada, have Z10s selling in-line or better than the iPhone 5 - I have read nothing about stock outs so that may very well be true. Their datapoint is disingenuous, they should have given us a comparative measure on sales, but they gave us a measure that was relevant in Week 1 -- its not week 6? Misek & Jankowski, MS fellow - you can expect something out of them before the open on Monday. BUY'EM!!!!
    22 Mar 2013, 12:20 PM Reply Like
  • grumbles
    , contributor
    Comments (91) | Send Message
     
    tomorrow they will say bb USA launch a disaster. the bb bashers have to come up with some tale or the other. wait till march 28th.
    22 Mar 2013, 12:25 PM Reply Like
  • bradalles
    , contributor
    Comments (5) | Send Message
     
    I live in Canada and have seen no price discounting. Who is doing it? Telus, and Bell have consistently offered it for $139 on a 3 year plan, while Rogers has kept it a $149 for the same 3 year plan. Where are your facts? Same for hardware costs without a plan. Zero change in their rates.
    22 Mar 2013, 12:32 PM Reply Like
  • Seppo Sahrakorpi
    , contributor
    Comments (1972) | Send Message
     
    BS, Z10 is $99 on Rogers ATM:
    http://roge.rs/100s5HF
    22 Mar 2013, 12:47 PM Reply Like
  • LYogi
    , contributor
    Comments (2263) | Send Message
     
    Bell Mobility as well.

     

    Likely in reflection of the Galaxy3 being offered for free
    22 Mar 2013, 12:49 PM Reply Like
  • ATInsider
    , contributor
    Comments (422) | Send Message
     
    The only discounts I see for the Z10 in Canada is calling the providers and talking them down. A few friends of mine picked up the Z10 each foe $50 a piece, no activation fee and signed a 3 year contract. You need to talk them down for a deal.
    22 Mar 2013, 04:03 PM Reply Like
  • Holmie
    , contributor
    Comments (2) | Send Message
     
    Yet it says "Sale" and it is in line with the iPhone 5 pricing. I noticed that on BestBuy.com they are selling the z10 for 800 off contract. I am guessing that they are trying to make even more money before the other companies come on line next week.

     

    Z10 does have a learning curve but once you get use to it.....it's an amazing device. Not a toy but a tool. So much more than a iToy
    24 Mar 2013, 02:09 PM Reply Like
  • sivakumaran13
    , contributor
    Comments (24) | Send Message
     
    Enough of this nonsense. Cut him off from this site.
    22 Mar 2013, 12:33 PM Reply Like
  • Cochise54
    , contributor
    Comments (364) | Send Message
     
    sivakumaran13.....good one...thanks for the laugh!
    22 Mar 2013, 12:37 PM Reply Like
  • Mr.Dan
    , contributor
    Comments (104) | Send Message
     
    I agree ! Complete nonsense ! We can expect some serious negative articles on BlackBerry as time is running out for these certain groups that want to see the stock price fall for profit.
    22 Mar 2013, 02:21 PM Reply Like
  • Primed24
    , contributor
    Comments (2) | Send Message
     
    Well, that should not be a surprise in Canada... when the Z10 launched Samsung put almost every one of thier phones on sale and its been like this for weeks. Everyday on the radio there are non stop ads telling people to run to thier nearest bell store to get the latest samsung phone for big discounts. So... it is a bad thing when the Z10 prices get cut but when samsung is offering up a fire sale it is ignored. Gotta love halfazzed reporting
    22 Mar 2013, 12:35 PM Reply Like
  • bbryuser
    , contributor
    Comments (427) | Send Message
     
    The market is climbing a wall of worry. with each launch per carrier imo share price will go up .50 cents sort of like a symphony. also why this survey only one week ahead of the earnings specifics. I haven't heard of any price cuts. Did we not go through this with earlier rumours in the UK My take is the market is climbing a wall of worry. And we are not seeing a huge soar...so bbry is building a base in anticipation fyi latest TV ad...post superbowl is really really good and illustrates the seamlessness of the hub. Very clever.
    22 Mar 2013, 12:43 PM Reply Like
  • PersephonShropshire
    , contributor
    Comments (137) | Send Message
     
    On another note the analyst Donald Duckoff has conducted checks of 138.855 stores all over the enitre universe and failed fo find a singel sellout of the iPhone 5 or Galaxy S3, rating them both a very VERY strong sell.
    22 Mar 2013, 12:55 PM Reply Like
  • A good year
    , contributor
    Comments (237) | Send Message
     
    On Feb 15 this analyst wrote the exactly the same information reported by John Paczkowski on iphoneeinstein.com
    Next week we will know what the real number look like
    22 Mar 2013, 01:01 PM Reply Like
  • hardlythinkso
    , contributor
    Comments (47) | Send Message
     
    Telus has the iPhone 5 for $99, iPhone 4 and 4s for $0 with various plans. Everything else is $49 or $0. Z10 is still offered at $149 making it their most expensive phone.
    22 Mar 2013, 01:25 PM Reply Like
  • Nick Shadow
    , contributor
    Comments (194) | Send Message
     
    I have been in the supply chain for 20+ years. If the reseller sells out, it is because he didn't gauge his demand correctly, same for overstock. It is very difficult to do on a new release, no run rate history to work from.

     

    BB can make educated guesses and this always comes down to a number that is usually created by conversations with the reseller's buyer and the manufacturer. So when they sell out, they re-order, restock. As time goes by they get a better picture of stocking levels. A retailer does not want to be out of stock, as a retail buyer will just go to someone who has stock and make the purchase (with software today he can locate a product (and price) without ever leaving the store. A stock out is a lost sale, not necessarily for BB, but for the reseller. On the other hand, the sales rep might try to move the buyer to something he has in stock, so there is potential down side for BB, just depends.

     

    As far a price discounting is concerned, this is a competitive situation between the resellers, Best Buy, Rogers, Amazon, they are pricing against each other, not BB. BB cannot dictate the selling price it is illegal. What they can do is voice their displeasure with a reseller who is eroding the street price, that is usually not a very fruitful conversation.

     

    All this talk about who has inventory and who doesn't is just channel noise. The big number is the sell through, that is the only one that counts.

     

    Lastly reorders from stock outs are good for BB, no one places another order for something that isn't selling. I could go into stock rotations, promos, qty buys, etc., but I would be here all day.

     

    Nick
    22 Mar 2013, 01:29 PM Reply Like
  • Loon-a-tick
    , contributor
    Comments (1618) | Send Message
     
    Yeah ...I was forgetting that. The retail phone company already paid BB for the phone at X price. That is the price. The retailer is selling phone service and band width so when they lower the phone price they are just hurting their bottom line.
    A three year plan and a phone for ...what ...12 x = 75$ a month X3 years ?
    Phone companies have lots of room to play with.
    22 Mar 2013, 01:48 PM Reply Like
  • kherman
    , contributor
    Comments (798) | Send Message
     
    People should not assume lessened demand due to price cuts. Carriers in canada are catching heat over 3 year contracts and cutting prices is a comprimise. Analysts as usual are clueless.
    22 Mar 2013, 01:57 PM Reply Like
  • GuiMo41
    , contributor
    Comments (19) | Send Message
     
    60 stores and yet to find a sellout! Why does it mean low sells and not very good supply chain from BB?
    22 Mar 2013, 03:00 PM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    I've been a Blackberry Bull since late fall and rode the stock up from buys at $6, $10, and $11/share.

     

    I became a Blackberry Bear last night. I was at the Best Buy product launch at the 14th Street Union Square even at 12:01 AM friday. Why did I become a bear last night, and why did I sell all my call options this morning?

     

    It was not because of the low turnout at Best Buy. The people who did turn out (I would say about 200) were the coolest and most interesting people and it was really enjoyable to hang out with them and talk Blackberry.

     

    It was not because of the Z10 phone which I tried last night at the event and which will be delivered to me today priority mail by USPS. I have no doubt the phone will be a great asset to me, despite a lack of apps (although I am reserving the right to exercise my buyer remorse period and return it if it turns out to be bad).

     

    The customer-level Blackberry reps also did a good job, and patiently explained the phones features to me, although I will say that when I asked more pointed questions, such as "will I be able to not only access my outlook inbox, but also all subfolders" the person doing the demo reverted back to the canned demo program. This indicates that Blackberry is not taking their consumer side of the sales effort seriously. I would say they are already rolling over and conceding defeat and are aiming either for a niche position in the short term and/or long-term a buyout. I'm sorry but the on-the-ground sales effort last night was not credible at all. The room was filled with very tech savvy Blackberry loyalists, and Richard Piasentin's lieutenants, some middle managtement sales execs, literally could care less about the input that I, and we, were offering about apps that are needed, etc. Definitely a turn-off and definitely a huge red flag that Blackberry's Sales Team is the biggest problem the launch has. It is imho from what I saw a smug, arrogant, insular sales team that has no interest and moreover no knowhow in how to pay attention to geeks, take notes, and go back to the design team and say "this is what we need, now!". I have always suspected that the sales team was at the root of Blackberry problems, and now I would say I know it for sure.

     

    BLACKBERRY HAS NO GROUND GAME AND HAS NO CREDIBLE PLAN OR STAFF WITH THE SKILLS TO WIN OVER TECHNOLOGY TRENDSETTERS.

     

    I never liked the Blackberry "Tools not Toys" ad campaign that they leveled at Apple back when Blackberry was sinking. It is sheer folly for a company to run an ad campaign with defies the reality on the ground - that your product is being creamed in the marketplace. what is really amazing is that, God rest is great soul, when Steve Jobs passed away, the quintessential ear-to-the-geek-heartbeat soul that made Apple the richest company in the world, and Apple was inherited by the suits again (think lifeless Tim Cook) Blackberry actually had an opening to fire their smug lifeless no-ground-game sales team and inject new life into their product by going after geeks on the ground, but obviously they did not.

     

    I sold my blackberry calls this morning. I even wanted to short it after the sale, but work prevented me from putting together my short game plan. I must say though I was pleased that I made 2x my win today because I "avoided" a massive call option loss this afternoon.

     

    Check my posts over the last 6 months. I have been a die hard bb bull. Now my message to you is:

     

    Sell this sucker, fast. They are going down. Not because they have a bad product (they have a great product) but because the best product in the world will fail if the sales and marketing effort stinks, and blackberry's sales and marketing effort stinks imho. By the same token, a GREAT sales effort can sell even a mediocre product (thing Galaxy SII).

     

    No, the warning signs were provided by Blackberry itself. The event was attended by Richard Piasentin, Blackberry's head of US sales. I talked with him for about 15-20 minutes and I can say of Richard only that he was attentive and interested in my feedback and comments.

     

    However, his sales lieutenants who were also there (which will remain nameless) were indifferent to my comments. Suits standing around. Literally one of his useless sales bigwigs said to me "we have nothing to do with the apps, no point in telling me about it." or something exactly to that effect. Crikey, this clown wasn't even MINGLING with the Blackberry cognesceti.

     

    Folks, Blackberry has internal organizational problems IMHO, and nothing, not even a great product like Z10, will save them from that. You gotta have ground game in today's world, and Blackberry does not have it. Just ask Mitt Romney, and, you heard it here first....

     

    Gil
    22 Mar 2013, 03:48 PM Reply Like
  • jaych79
    , contributor
    Comments (506) | Send Message
     
    So you are saying that the reason you bought in the first place has changed? That must mean they did have a ground game in the beginning and now that is no longer the case. Or did you have some other reason for being bullish? If so, has that changed? If the reason you bought has not changed, I don't understand why you would jump ship. Because a few guys seemed indifferent?
    22 Mar 2013, 04:03 PM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    jaych79. Thanks for your reply. I always had concerns about the Blackberry sales team. They are accustomed to having the market entirely to themselves. They never remade the sales department afaik after they were creamed by the competition. I bought then, and I bought up until recently, because all along, Blackberry has always offered the best engineered DEVICES commercially available. It's not an accident that DOD and Barack Obama carry Blackberry's. Blackberry engineering is peerless imho. But I never "had the goods" so to speak on the Sales team at RIM (now Blackberry) but always suspected they were a big part of the catastrophe that occurred at RIM. They failed then to listen to their average customers, and I saw it with my own eyes last night for the first time. Friend, I'm talking about total indifference to the people who had showed up for the product launch at Best Buy Union Square Manhattan. There was a guy and a woman who were upper level direct reports to Piasentin who were not even mixing with the customers to get input (incredible, I mean, think about what that says about their sales intel of the "average customer") but were not even willing to listen when you specifically went up to them and sought to give them feedback about the product. Hey, my New York license plate is "BBRY:" - I reserved it 45 minutes after they announced the new ticker symbol. I have another sportscar in the midwest, and I also reserverd "BBRY" for that one. Yo, I am a Blackberry FANATIC. But money is money. I can still buy their product and enjoy it immensely, and use and leverage yet another engineering marvel from Blackberry engineering (who are those folks anyway - the engineering team at Blackberry is AWESOME!) but I'm not going to buy call contracts and hold Blackberry stock when I can see with my own eyes that the sales team has no ground game. Like I said, no matter how great the product, without a stellar ground game, the product is essentially doomed to be a commercial failure and a technological success. Yes, it has changed. And witness today, i was not the only one jumping ship. I won't even buy after more down days anymore. I am now convinced this company will not make it unless they COMPLETELY rebuild their sales team, bring in new blood (AND FAST!) and/or are bought out by a white knight with a sales team that knows what it takes to get the job done and sees that they have an awesome product with a crummy sales effort and buys them to turn the sales effort around and make this product the success it should be.
    22 Mar 2013, 04:33 PM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    Also, I would like to point out that these are not just "a few guys who were indifferent". These are direct report to Richard Piasentin who runs the US Sales effort. When I see high-ranking people like that not putting their heart and soul into an important event for a product that is given at best a 50/50 chance of commerical success, that to me is a HUGE red flag, huge.
    22 Mar 2013, 04:50 PM Reply Like
  • Shergar
    , contributor
    Comments (167) | Send Message
     
    Hope that is confined to the US, but its likely not. I called quite a few AT&T stores on tuesday, some still had the wrong launch date only 3 of 10 had seen someone from BBRY to show them how to use the phone. Today I was in an AT&T store and the manger told me he believed it was the best phone in the store, but before he learned how to use it, he thought it was a lost cause - that particular store (in boston) sold 8 of 20.
    23 Mar 2013, 02:36 AM Reply Like
  • jaberwock
    , contributor
    Comments (252) | Send Message
     
    Why would there be line-ups at the stores? If BlackBerry were to double or even triple its market share, it would still have less than 10% of the US market. Stores should easily handle that kind of demand without line-ups.

     

    Why would you expect sell-outs? BlackBerry was caught out by unexpected demand in Canada, UK and India, but has increased production three times since the launch, and has had plenty of time to stock the US shelves with adequate product.

     

    Also, most BlackBerry sales are to businesses, who generally don't line up at retail stores to buy phones.
    22 Mar 2013, 05:32 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5619) | Send Message
     
    "Over the past week two carriers in Canada have cut prices on the Z10, suggesting to us lessened demand and possible margin pressure ahead."
    Ok, so margins might not be as good as hyped. But what about sales? (BBRY) is not overly priced to start with.
    22 Mar 2013, 06:08 PM Reply Like
  • Gene Chan, CFA
    , contributor
    Comments (232) | Send Message
     
    Carriers competing with each other on price promotion doesn't mean it affects BBRY's margin at all.
    22 Mar 2013, 06:22 PM Reply Like
  • allstar0088
    , contributor
    Comments (378) | Send Message
     
    @gstanden - Please get over yourself.
    22 Mar 2013, 06:50 PM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    @allstar0088 - who are you a Blackberry executive? I'm providing on-the-ground intel for investors who have money at stake. There were only 200 people at the "Launch Event" at the Union Square Blackberry "Event" at 12:01 AM last night. The "Blackberry executives" present were anemic at best and utterly uninterested in the event at worst. And it wasn't just me allstar0088. They were literally standing away from the crowd of Blackberry Believers far from the action, as if they were looking at a bunch of cows in pasture. That is not how you put together a comeback. Why should I get over myself and what does that have to do with anything. So maybe I am in love with myself. So what? There's a lot to love, I have 2 sportscars, 50 acres of land waterfront on an island, an estate in the midwest, a cooperative in New York, and I bought a place for my mother and my stepson and his family too. I didn't accomplish all that by ignoring the facts on the ground. Don't forget Robert DeNiro in "Heat" when you are investing: "Don't let yourself get attached to anything you are not willing to walk out on in 30 seconds flat if you feel the heat around the corner." I love the Blackberry product, but again, I don't have to invest in them if their sales effort stinks, and in my opinion, they are never going to win the average consumer with the current sales team. I work for a company that has a GREAT sales team and I know what it takes because I have seen it. We have salesmen who are like a hyperborean wedge clearing a path for us to shine. These guys are just presiding over an extinction. I'll be you $50 the sales numbers are going to be flat bad or even atrocious at the March 28 earnings call. I'm even going to short them big time ahead of that call just so I can (hopefully) tweet to you allstar0088 "I told you so." If I'm wrong I lose money, capiche?
    22 Mar 2013, 08:33 PM Reply Like
  • gstanden
    , contributor
    Comments (387) | Send Message
     
    @allstar0088 And one other thing "allstar0088" I put my real name behind my comments. I stand behind what I say and i sign what I say,, win or lose, with my real name.
    22 Mar 2013, 08:56 PM Reply Like
  • allstar0088
    , contributor
    Comments (378) | Send Message
     
    @gstanden - Your profile says you're a "SENIOR" engineer at Oracle with multiple degrees, yet you lack the technical chops to straighten your profile's photo.
    22 Mar 2013, 09:14 PM Reply Like
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