Will BlackBerry's iPhone Trade-In Deal Boost Sales?
The deal starts on December 1 and includes every model between the iPhone 4S and iPhone 6/6 Plus. While most users are unlikely to trade in an iPhone 6 a couple months after its release, there are millions of iPhone 4S, 5, 5C and 5S users that could be tempted to upgrade.
Will the deal persuade them to switch to a new brand? Industry experts aren't very hopeful.
"I think it's a terrible idea," Brett Golden, president and co-founder of The Chart Lab, told Benzinga. "I don't think it will work at all. I just don't think anybody cares about that money. If I don't like the [new] product and I like an existing product, I'm not going to switch just for the money."
Thomas H. Yorke, managing director of Oceanic Capital Management, isn't sure the trade-in deal will help the company succeed.
"I know they turned the company around," Yorke, who serves as a portfolio manager on Covestor, told Benzinga. "They're making some money, finally. But it would seem to me that this is sort of a Hail Mary pass to try and salvage the company."
Yorke said BlackBerry's troubles started when the company failed to make the transition from being an "e-mail machine" to a mobile computing device.
"I remember back in the day when Motorola made the StarTAC," Yorke added. "They had a number of other successful phone introductions, but the StarTAC, to me, was kind of a quantum leap forward. It was no longer big and bulky and really heavy. You could slip it in your pocket and carry it around. There's been moments in time with Motorola where I thought, 'Who could ever beat this company?' I had the same feeling [about] BlackBerry for many years."
Yorke said that Apple Inc. and Google Inc quickly realized that mobile devices had to offer more than e-mail.
"I used BlackBerry for many years," he concluded. "It would have been really, really hard to believe in 2000 -- even as late as 2005 -- that they would not [make the transition]."
Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.
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