The sub-par Storm

Research In Motion (RIM) and Apple continue to dominate the consumer smartphone market.

But market-share leader RIM must improve customer satisfaction and fix glitches with its new BlackBerry Storm in order to defend itself against long-term challenges from Apple's iPhone, according to the latest ChangeWave Research survey.

The anticipated BlackBerry Storm was released late last year. It is RIM's first touchscreen, keyboard-free handheld unit, and was positioned as a contender to iPhone.

This December 9-15, 2008 survey of 3,803 cell phone owners takes a close look at smartphone market trends, including consumer reaction to RIM's launch of the BlackBerry Storm and how it compares with the Apple iPhone. It was conducted shortly after the Storm's launch, reports MarketingCharts.

Smartphone Market Demand

The overall growth rate for the smartphone market has contracted since the last survey, but it remains positive despite the recessionary climate, Changewave said. 12.2% of respondents plan to buy a smart phone in the next 90 days, 0.3% more than previously.

Current Market Share

While RIM (41%) is still the consumer market-share leader, it fell one point since Changewave's previous survey in September. It is now at its lowest percentage in the last 12 months.

At the same time, Apple witnessed explosive growth (23%) — up 6 points since September. Overall market share more than doubled in the past six months — a direct result of the July release of its popular 3G iPhone.

Together, Apple and RIM now control two-thirds of the smartphone market, as smaller/weaker players such as Palm (9%) prove unable to compete.

Winners and Losers in the Next 90 Days

The picture going forward points to changes in the smartphone market, according to ChangeWave. RIM (39%; up nine points) shows momentum because of its slew of new product launches - like the Storm, Bold and Pearl Flip - and appears capable of giving Apple a run for its money in the first quarter of 2009.

Moreover, after the huge wave of enthusiasm generated by the 3G iPhone launch, Apple consumer planned buying (30%; down 4-points) appears to have settled down.

Customer Satisfaction: BlackBerry Storm vs. The iPhone

The survey also examined the reaction of 61 owners of the new BlackBerry Storm, and compared the results with a similar survey in July 2007 of new owners of the original iPhone.

The overall satisfaction rating given by new owners of the Blackberry Storm can at best be characterized as lukewarm. One in three Storm owners (33%) were "very satisfied" with their new model, well below the 52% very satisfied rating given by all current owners of BlackBerry smartphones.

Changewave said that the satisfaction rating for the Storm is similar to that of mid-tier smartphone manufacturers like Nokia (32%), Motorola (32%), HTC (31%) and Samsung (30%). While it's not bad, the company said, it is mediocre. This points to a potential concern regarding RIM's head-to-head battle with Apple.

In contrast, the original iPhone's very satisfied rating (77%) was more than double that of the new BlackBerry Storm (33%), and the Storm's "unsatisfied" rating (14%) is three times higher than that of the original iPhone (5%).

Moreover, 4% of new buyers report they've already returned/exchanged their Storm, or are very likely to return it. Another 7% say they're somewhat likely to return or exchange it.

BlackBerry Storm: Key Likes and Dislikes

The survey also asked respondents to rate what they liked best and disliked most about the Storm. The results show the touch screen is a highly popular option. One in two (49%) say "touch-screen interface" is what they like best about their BlackBerry Storm. Other key likes include screen size (46%) and screen resolution (43%).

At the same time, the touch screen interface represents one of the BlackBerry Storm model's biggest problems. Regarding dislikes, Lack of a QWERTY Keyboard (21%), touch screen interface (20%) and difficult to use (20%) were top issues, along with short battery life (21%).