R.I.M.’s share of the American smartphone market reflects this shift. It fell to 41 percent in the first quarter from 55 percent in the previous year, according to Gartner. The combined share held by iPhones and Android handsets rose to 49 percent, from 23 percent over the same period.
True, R.I.M.’s sales in overseas markets are increasing, enabling it to hold its share of the global smartphone market more or less steady. But handset trends increasingly originate in the United States because of the growing importance of smartphone software.
Moreover, R.I.M.’s overseas push has been accompanied by a sharp fall in the average price of its handsets. While phones are priced differently overseas, the suspicion is the company is losing pricing power. Nokia’s troubles, and the decline in its stock price, show that increasing volume doesn’t matter if prices fall too fast.
The BlackBerry maker’s shares may appear cheap. They trade at 10 times estimated earnings for this fiscal year. Yet Apple and Google’s dominance in apps means they are becoming de facto standards in the smartphone market. Technology companies that lose such wars often suffer shockingly fast profit declines. R.I.M. still has a shot. This fall, it is due to introduce a new operating system, which might help it fight back. But time is running short.