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Is limited supply hampering BlackBerry Z10 sales in the UAE?

By Joseph George

Industry watchers and analysts are revising downwards their current-quarter global sales estimates for the BlackBerry Z10 on the back of serious concerns about the Canadian firm’s ability to keep up the supply of the new device in line with the demand.

BlackBerry Z10 seemed to be making headway to be among the top-sellers among smartphones in the UAE, but stocks have been running out almost on a daily basis, claim retailers.

While BlackBerry is trying its best to cope with the demand, the burning question remains whether the firm underestimated the demand in the first place or did it go ahead and launch the smartphone unprepared, in a bid to launch ahead of other phones – Sony Xperia Z and HTC One, for instance?

T. Michael Walkley, an analyst with Canaccord Genuity, had initially reckoned BlackBerry would sell about 1.75 million Z10 smartphones in the current quarter.

But following worldwide reports of a supply shortage – and softer than expected demand – the analyst slashed his estimates for the current quarter from 1.75 million units to just 300,000.

“Our global surveys post the recent BlackBerry Z10 launch indicated mixed initial sales with limited initial supply cited as the reason for early post-launch stock-outs at some carrier stores rather than overwhelming demand,” Walkley wrote in a note to investors.

In the UAE, the stocks are being replenished on a regular basis, claim retailers – but is that good enough for a country that was on the list of handful of global destinations that saw the smartphone being unveiled?

“The demand is good. On an average we are selling about 20 to 30 units every day,” a sales executive at Sharaf DG said when contacted by this website.

“Our follow-up checks have indicated steady but modest sales levels.

With new BB10 smartphones launching in the US only in mid-March or later at subsidised prices no better than competing high-end Apple/Samsung smartphones, combined with our expectations for the Galaxy S IV to launch at a similar time frame in the US market, we are lowering our BB10 sales estimates for the February quarter and all of F2014,” Walkley added in his note.

Our own quick survey too exposed the supply constraints. Many stores that Emirates 24|7 contacted said they had very few units left. “The stock situation is fluctuating. We run out of stocks on some days. But then we receive fresh stocks soon. Currently we have about four units remaining, all white,” said the Sharaf DG sales executive.

eMax, another UAE electronics retailer, too said BlackBerry Z10 stocks continue to remain thin. “We still have stocks, but they are limited.

Ever since BlackBerry launched its Z10, it has been the No. 1 seller.

We still have Samsungs and iPhones selling but they have been pushed to No. 2 and 3 spots,” said another sales staff.

That will be music to the ears of BlackBerry, but is supply remains short, will customers continue to wait? “There are a few who still continue to opt for the BlackBerry Bold. Those are mostly who are all qwerty fans,” added the eMax sales personnel.

Axiom Telecom, BlackBerry’s official resellers in the UAE, had earlier announced that the new BlackBerry Z10 is accounting for almost 60 per cent of all handset sales across its UAE stores since being available on February 10.

“The UAE’s response to the Z10 has been truly remarkable, and we are set for huge, record-breaking sales,” said Faisal Al Bannai, CEO, Axiom Telecom.

“We knew that the UAE is one of most enthusiastic BlackBerry markets in the world, so we planned well ahead to ensure we were ready to cope with customer demand. The strategy has paid off, and we are proud to say that there are still plenty of stocks across all of Axiom’s UAE stores.”

Axiom claims it has enough stocks available even as in-store stocks remain very limited. A sales staff at Axiom Dubai Mall, speaking over the telephone, said it had run out of stocks since Monday. “Tomorrow, probably, it might be available,” he said.

“We are continuously receiving shipments from BlackBerry and have been able to serve customer demand thus far. We urge customers to book the product in the exception situation that the product maybe out of stock during brief periods,” added Bannai.

BlackBerry is hoping for a turnaround in its prospects with the Z10.

BlackBerry CEO Thorsten Heins is reported to have said Z10 is their bestselling phone yet. “In Canada, yesterday was the best day ever for the first day of a launch of a new BlackBerry smartphone. In fact, it was more than 50 per cent better than any other launch day in our history in Canada,” Heins said on February 6.

“In the UK, we have seen close to three times our best performance ever for the first week of sales for a BlackBerry smartphone,” he added.

There has been bad news as well. The phone is yet to go on sale in the US market and analysts there are already expressing disappointment.