BlackBerry and Nokia look to Middle East for succour at Gitex Technology Week

The BlackBerry Z30 and Lumia 1020, along with other devices most likely to be on display at Gitex Technology Week, come from manufacturers that have struggled to sell their wares in North America often despite of positive product reviews.

Nokia has long dominated sales of mobiles in the UAE with more than 56 per cent of the local market. Above, a Nokia Lumia 1020 product demonstration at US shop. Kelvin Ma / Bloomberg News

Smartphones such as the BlackBerry Z30 and Nokia's Lumia 1020 were among the most lauded devices that went on sale this month in conjunction with Gitex Shopper.

But these mobiles, along with other devices that will most likely be on display at Gitex Technology Week in Dubai from today, come from manufacturers that have struggled to sell their wares in North America of late – often despite positive product reviews.

Part of the challenge: wavering consumer confidence in these firms and the longevity of their products.

Nokia has long dominated sales of mobiles in the UAE. The company, based in Finland, commands more than 56 per cent of the local market.

Samsung comes in a distant second place with just 13.8 per cent of the market, according to a report from the UAE Telecommunications Regulatory Authority (TRA).

But while Nokia's new Lumia 1020 boasts a 41-megapixel camera sensor and debuted in New York City with much fanfare this year, it has struggled to catch on with consumers in North America on the same level as the latest mobiles from Apple and Samsung.

At the same time, Nokia’s lower-cost devices are facing increasing competition from Chinese manufacturers that are more aggressive with their price points, says Anshul Gupta, a principal research analyst for Gartner.

Nokia’s selection of mobiles that cost less than US$100 are within a “highly competitive market”, acknowledged the company’s outgoing chief executive, Stephen Elop, during its latest earnings announcement. “While we are very encouraged by the consumer response to our innovations in this price category, our mobile phones business unit is planning to take actions to focus its product offering and improve product competitiveness,” Mr Elop added.

Lacklustre mobile sales, combined with continued operating losses, have led Nokia to cut more than 40,000 jobs over the past three years. Last month, Microsoft announced plans to acquire Nokia’s mobile phone business and access to its patents for €5.4 billion (Dh26.87bn).

Mr Elop is leaving Nokia to head Microsoft and increase its hardware and software presence both in the United States and abroad.

At Gitex, Microsoft plans to showcase its latest offerings, including new tablets, laptops and Windows 8.1 software. Despite being based in the US, the technology company is committed to supporting the Arabian Gulf’s development through innovations that will be demonstrated at Gitex, says Samer Abu Ltaif, the regional general manager at Microsoft Gulf.

“Gitex is an opportunity for technology, government and business leaders to be inspired by the innovation within the technology industry and find solutions that will address the requirements of their customers, enhance productivity and reduce costs,” Mr Abu Ltaif said when he announced Microsoft’s participation in Gitex this year.

BlackBerry, which is based in Canada, has also floundered for several years.

At its peak, BlackBerry – once known as Research in Motion – employed nearly 20,000 workers and was valued at about $80bn. Yet it now plans to cut 4,500 jobs, or about 45 per cent of its current workforce. And the phone maker is weighing a sale of some of the buildings it owns, as well as discussing a $4.7bn buyout deal with Fairfax Financial Holdings.

Meanwhile, interest in BlackBerry’s products has waned.

More than 70 per cent of respondents in a survey within the US said nothing could get them to buy a BlackBerry smartphone, including a bigger screen or lower price. That figure compared with 31 per cent for those who said nothing would convince them to purchase a new Android-based mobile, and less than 20 per cent for Apple’s iPhone, according to data released in April by the financial services firm Raymond James.

In the UAE, the BlackBerry has traditionally been stronger than Apple’s iPhone. The brand currently commands nearly 11 per cent of the mobile market here, followed by Apple with 7.4 per cent, according to the TRA.

Yet there are signs BlackBerry is weakening in the Emirates, too.

One survey of consumer electronics buyers in the UAE found Samsung mobiles, followed by Apple phones, dominated the market in terms of recent, as well as planned, purchases. BlackBerry devices were well behind the rest, according to Plug Ins, the local electronics retailer that released the survey last month.

The changing dynamics have made the UAE even more important for manufacturers from North America as they look to maintain, or ideally grow, their footprint. Increasingly, companies such as BlackBerry and Apple, based in California, have started rolling out their new flagship products in malls across Abu Dhabi and Dubai soon after their release in the manufacturers’ home markets.

“This shows how important this region is to their overall strategic plan,” says Ashish Panjabi, the chief operating officer of Jacky’s Electronics here in the UAE.