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BlackBerry offers free apps for furious users

TORONTO — The BlackBerry has left a bitter taste in the mouths of its users.

Trying to make amends for massive outages last week, Research In Motion on Monday promised BlackBerry users free premium apps and a month of technical support. But the apology is unlikely to placate miffed customers, many of whom are considering whether to part with the tarnished brand in favor of more popular devices such as Apple’s newest iPhone.

Jim Balsillie, one of the company’s two CEOs, acknowledged in an interview on Monday that his company has come under intense pressure. Even so, Balsillie defended RIM’s handling of the crisis, the company’s worst outage ever. He noted that RIM has survived through rough times before.

The Canadian company said it will give BlackBerry users free apps worth more than $100. The apps, which will be available over the coming weeks, include iSpeech Translator, Bejeweled and Texas Hold’em Poker 2. The offer runs until the end of the year.

For its enterprise customers, Research in Motion will offer a month of free technical support.

Last week’s blackout interrupted email and Internet services for tens of millions of users around the world and left RIM executives apologizing profusely days after the crisis began.

RIM’s outages came at a particularly bad time. On Friday, Apple introduced its most recent iPhone —the iPhone 4S. In its first three days on sale, according to Apple, 4 million of the new phones were purchased. That’s more than the average number of BlackBerrys RIM sells per month.

RIM has since scrambled to reassure customers. Balsillie stressed that the company is taking the problem seriously. He said the free offer to consumers includes high-value apps.

“This is something we would like to offer as our form of thanks. It’s a $100 worth of premium apps. It’s a substantial offer to our 70 million users around the world,” Balsillie said.

Balsillie and co-CEO Mike Lazaridis came under pressure last week when they failed to talk publicly about the outages until Thursday, the fourth day of the service interruption.

John Crean, national managing partner of Nation Public Relations, the largest public relations firm in Canada, said RIM was too slow in managing the crisis. “Given the significance of the delay and the global nature of it, they should have had their CEOs out earlier and more visible,” Crean said.

Crean said the latest crisis has to be looked at in the context of what’s been happening to RIM. He said the narrative of RIM over the last year is that they’ve lost the cachet of having a must-have smartphone.

“The brand has diminished significantly in the last year and this is not helping at all,” Crean said.

Crean said the app offer is a good tactic, but by no means a strategy to repair the brand. He said he still hasn’t heard what RIM has done to enhance its system to avoid future interruptions.

Chris Allen, a 26-year-old cable technician in Fall River, Mass., said he was happy to get free apps for his personal BlackBerry, but thinks the offer will miss the mark with core users.

“Most of the people that use BlackBerrys are business people and all they care about is: ‘Does it work?'” Allen said.

When service went out on Wednesday in the United States, Allen worked around it by using a third-party Web browser that wasn’t tied to RIM’s network. He’s pretty sure he’ll get another BlackBerry when his phone contract is up next year, and the outage didn’t change that.

“There’s nothing that can beat a BlackBerry for productivity,” Allen said.

Larry L. Smith, the president of the Institute for Crisis Management, a public relations company, said the most important thing a company can do in a meltdown is to take responsibility for the problem and communicate what they’re doing along the way to fix it.

Balsillie said he was too busy trying to find out what the root cause of the problem was to comment in the first days of the crisis. He said he was in the Middle East at the time and spent day-and-night on the phone with customers and carriers.

“The most important thing is staying connected to the ecosystem and making sure you’re on what’s the root cause. If you spend more time on PR it’s less time finding the root cause,” Balsillie said.

Peter Misek, an analyst at Jefferies & Co. in New York, said RIM had to figure out what was wrong before they announced anything. Misek said it was just the latest in a string of problems for RIM, which has faced product delays, poor reviews and disappointing sales. RIM’s stock is down over 80 percent from its high three years ago.

Misek said RIM is behind competitively and is in the process of transitioning to a new operating system and thus is facing more uncertainty than ever.

It’s clear that investors were still not in a forgiving mood Monday.

Shares of Research in Motion Ltd. slumped more than 6 percent, or $1.57, to $22.40. Earlier this year, shares traded around $70 each.