Ronnie05's Blog

Requiem for the Blackberry Dream

Posted in Mobile Devices and Company Updates by Manas Ganguly on September 21, 2013

Z10-HandsOn-02-578-80

Blackberry has finally cuts its jugular and the ride has winding down. Its been in the making for over 3 years now. The revenue and device shipment numbers are pretty surprising given how weak it is – the situation at Blackberry is much worse than anticipated. A couple of questions to be answered for Blackberry at this critical moment…

BB rise and fall

Where Blackberry disconnected?

1. An ageing portfolio that never saw much in terms of innovation – There were always a handful of Blackberries – Storm, Bold, Curve, Torch – 4 devices through 4 critical years when Apple and Android stormed the markets.
2. The customer experience was very below average – The BES and BBM were great services – but Blackberry was mighty bland in designing experiences around the customer and these services.
3. In an age where Applications are key and must be scalable across platforms, BlackBerry apparently provided no incentive to port many older BB7 business apps that enterprise companies use to run on BB10 on launch. That was being stupid.
4. Blackberry misread the BYOD wave in enterprise, blinded by its past glory of securitized enterprise solution. The segment where Blackberry was unassailable till sometime back -has simply moved on to other solutions from companies like include Citrix, MobileIron, Maas360, Microsoft and Airwatch.
5. Customers today are averse to be bogged down in their choices- to a hardware with a service bundle. They value flexibility in terms of choosing their own device and “Appizing” it with enterprise and security features.
6. The Q10 and Z10 was a case of wrong targeting – Blackberry could have probably done better with mid level and entry level phones for the customer – Their carrier commitments would have given them some solid seeding in the market and made numbers happen. As the portfolio is now pruned, it is interesting to note that within 7 months of launch, the Z10 is now being re-positioned as a mid tier device for emerging markets. The concern still remians that Samsung is eating everybody’s lunch in the mid segments across markets.

What do the current set of actions at Blackberry signify?

Cutting the headcount hardly addresses any of Blackberry’s pressing needs of the day.However, I don’t think anybody could do much better with it. The current cuts helps cleans things up for any type of potential deal or acquisition that they’ve been very forthright about seeking. Beaten on Hardware and pushed out of its enterprise security space- It’s probably going to find limited value for most potential buyers.Cutting operating expenditures deep is the best they can do to try to stabilise this ship.

Is Blackberry Attractive? What parts?

Even if Blackberry were to dissolve its hardware arm and its services arm and use its services arm – it would hardly be a cake walk as one would otherwise expect. The BYOD and the Apps space has cannibalized Blackberry’s USP. It is hardly the incumbent in the enterprise market.

Blackberry’s agreements and contracts with hundreds of mobile operators could be valuable to someone who has an intent to engineer a new mobile global network of devices or services (Apple, Google, Visa, Mastercard).

So, what can Blackberry expect?

The best Blackberry can hope for is a Nokia-style takeover, though who would actually take over is tough to imagine.

The other possibility is that a leaner BlackBerry will abandon the consumer market once and for all and get rigorous about becoming a niche company focused on a particular customer — one that needs security, control, and a few particular tasks done remarkably well, possibly even as a software rather than a hardware company. If the company is deciding to evolve to a service company, Blackberry needs to act small and become innovative like a startup

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