Could BlackBerry be 2017’s Comeback Kid?
Security

Could BlackBerry be 2017’s Comeback Kid?

The years since Apple released the iPhone in 2007 have been difficult indeed for BlackBerry. Since that date, the Canadian company has shed its former name of Research In Motion and has seen a precipitous decline in sales of its smartphones. To many it might seem just another technology company riches-to-rags story but it could yet prove to be like one of Roald Dahl’s Tales of the Unexpected and deliver an unexpected sting at the end.

Few tech companies, excepting the luminous examples of Apple under Steve Jobs or IBM under Lou Gerstner, have survived and prospered after a change of focus. But BlackBerry’s turnaround plans that have seen it switch focus to security software and services might be bearing fruit.

Florian Bienvenu certainly hopes so. The French SVP of BlackBerry EMEA is bullish on the company’s future and he has had as good an oversight of the ‘before’ and ‘after’ of the company as any, having joined via the acquisition of mobile device management software provider Good Technology in 2015. And while many pundits queue up to bury BlackBerry, Bienvenu sees this time as a period of new growth.

“It’s not the end of an era but an opportunity to commence a new chapter,” he says. “What we have been concentrating on is excellence in software and security solutions. If you look at the results [for BlackBerry’s last quarter to September 2016 at time of interview] this is a strategy that works - more than 100 per cent year-on-year growth in security and software and two quarters of breakeven. We’ve restructured on our terms and the company is doing good.”

That second quarter might surprise those who view BlackBerry as a relic. The company remains substantial with $352m in revenue with software and services accounting for $156m of that and up by 89 per cent year on year. (Software and services made up 55 per cent of revenue in the following quarter and the company made a small profit.) But it was more than the numbers that was interesting: BlackBerry also entered into an agreement that will see Indonesian telco BB Merah Putih make and distribute BlackBerry devices. Those devices will run on the Android operating system and the same applies to Blackberry’s DTEK50 which also launched in the quarter. In other announcements the firm started shipping BlackBerry Radar, an asset-tracking service aimed at the Internet of Things, and signed a deal with Emtek Group to develop apps on the BBM messaging platform.

CEO John Chen called the period “an inflection point with our strategy. Our financial foundation is strong and our pivot to software is taking hold.”

That pivot involved a spree of mergers and acquisitions to give the company a very different look and it also recently included the long-inevitable announcement that BlackBerry would no longer manufacture the devices that are named after the keyboard’s raised surfaces like the fruit of the same name.

What Chen is betting on is a leaner, meaner company that can target fast-growth sectors, show competitive differentiation and not get blown away from the intense competition that characterises the mainstream smartphone sector.

That licensing strategy, says Bienvenu, represents “the best of both worlds”, freeing up BlackBerry to capitalise on the brand, inherent security and messaging that made its name while not being weighed down by costs and risks. Bienvenu also underscores another strength the company has in the government sector where BlackBerry supplies to all of the G7 powerhouses and 16 of the biggest country governments. It also supplies all of the top 10 financial services companies.

The idea in short is to let companies have their staff become “more mobilised, more productive [and to] secure the ‘Enterprise of Things’ to get full value of the IoT on any piece of glass, any OS,” Bienvenu says. Early in December, BlackBerry tidied up that effort with a wide-ranging renaming of acquired products that give it a fairly comprehensive collection for tracking devices, sensors and other endpoint “things” under the BlackBerry Secure brand.

Blackberry still has $1.2bn in net cash to place its bets in enterprise mobile management where analyst firm Gartner sees it as a clear leader with no clear second runner. Can BlackBerry grow again? Perhaps.

 

Also read:

Could security juice up Blackberry?

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Martin Veitch

Martin Veitch is Editorial Consultant for IDG Connect

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