by Al Sacco

Apple iPhone 3G to Battle RIM BlackBerry at Best Buy

Aug 13, 20083 mins
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Well, well, well, it looks as though Apple has finally decided to form an iPhone 3G distribution partnership with the world’s largest consumer electronics retailer, Best Buy.

Interested parties can purchase new iPhones only at Apple and AT&T retail stores, but that’ll change come September 7, Shawn Score, president of Best Buy Mobile, told the Associated Press (AP).

Best Buy Logo

The news represents the latest move by Apple to cement itself as a major player in the U.S. smartphone space and to steal share from market leader Research In Motion, maker of the popular BlackBerry smartphone. Best Buy has sold BlackBerrys for years, along with other leading smartphones, like Palm’s Centros and Treos and Motorola’s Q lineup. And the company also has partnerships with all of the nation’s major wireless carriers, including AT&T, Verizon, T-Mobile and Sprint, making it a leading seller of wireless phones.

According to Score, Best Buy spent the last year and a half building and refining its mobile phone centers to convince Apple that it should be the first electronics retailer to offer the iPhone 3G throughout its roughly 1,300 U.S. retail stores, many of which house Best Buy Mobile kiosks or stations. There are also 16 standalone Best Buy Mobile shops, the AP reports.

Minneapolis, Minn.-based Best Buy already carries some Apple products, including iPods and Macintosh computers, but the new deal will make it the first U.S. retailer besides Apple and AT&T to sell the iPhone.

Rumors are also bouncing around the Web about a possible Radio Shack iPhone distribution pact, though no such deal has been confirmed.

RIM owns the U.S. smartphone space with more than 44 percent market share, compared to Apple’s 19.2 percent share, according to first quarter 2008 smartphone market share metrics from tech research firm IDC—a sister company to CIO –but the Best Buy deal is almost guaranteed to level the playing field a bit…and a similar agreement with Radio Shack wouldn’t hurt either.

Shortly after IDC released its numbers earlier this summer, I blogged about how the numbers could be deceiving if not taken in the correct context. More specifically, I pointed out how Apple currently sells only one phone, compared with RIM’s dozen or so smartphone models. And though this still holds true, the fact that Apple will soon be selling the iPhone through a store like Best Buy can only build awareness and accessibility for Apple’s smartphone.

Lineup of three Apple iPhone 3G smartphones
The Apple iPhone 3G

This is a big move for both Apple and Best Buy and a significant blow to RIM in the United States. Sure, Apple’s still got a way to go on the road to becoming a true BlackBerry rival, but the fact is that it’s on the right track.

The next steps in Apple’s strategy should be to sign iPhone contracts with all the major U.S.—and international—wireless carriers as soon as its current exclusivity deal with AT&T expires in 2010, then begin offering new and different iPhone models—can you say full QWERTY keyboard?—to cater to a wider variety of users. (Apple should also work to put measures in place to ensure it never finds itself in the mobile mess that ensued shortly after the iPhone 3G and MobileMe launch, but that’s another story altogether…)

What do you think? Is the Best Buy news a dig deal or a non-issue for RIM and Apple’s other competitors in the smartphone space?