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Mobile Communications

Snapshot: BlackBerry Is Down But Not Necessarily Out

As BlackBerry is currently experiencing, an unedifying spectacle awaits those who stumble in technology as journalists, pundits and others seek to bury the afflicted organisation. The internet is awash with commentary on the Canadian company with legions already dissecting the body ahead of an assumed imminent death. But BlackBerry is far from dead and supporters of the company might take heart in previous examples of companies that have bounced back.

There are several potential scenarios for BlackBerry.

Build a better mousetrap. Unfortunately for Blackberry, the Z10 and BB10 OS have not proven to be the perfect Hail Mary pass. R&D cycles are brutal in smartphones and missing a step condemns followers to years of pain. Unless Blackberry has something “insanely great”, to use Steve Jobs’ phrase, in its secret locker, usurping the current market leaders isn’t going to happen anytime soon. And noises off suggest that locker is not full.

Slim down and rebuild organically. The painful layoffs will create a smaller company but one that is more fit for purpose. BlackBerry has a loyal core user base with an unusual, desirable demographic: many of its biggest fans are email-addicted C-suite executives and other senior figures that rely on a keyboard and secure network. That constituency alone can build a powerful, albeit relatively small, concern. Stories suggest that executives could buy back the company and take it private. This would give it the breathing space to go again, out of the glare of the public markets, and it is a tactic that Michael Dell and a few notable others are pursuing.

Sell out. When BlackBerry said it was exploring all strategic alternatives, many watchers equated that with putting a ’For Sale’ notice in the yard. This would help shareholders recoup losses and provide cash to go for growth but there is little to suggest that a buyer could inspire BlackBerry to rise again. Who would buy anyway? Microsoft until recently seemed a natural match but now it has Nokia and remains involved in its Sisyphean task of pushing Windows Phone. A private-equity firm would only strip assets. Any deal would lead to high risk and departures: the template of HP’s purchase of Palm casts a sinister shadow.

Option two then is preferable and, despite the gloom and doom, companies can have a second wind. BlackBerry leaders need only to look at another company that had iconic products, looked down and out in the 1990s, but went on an epic journey to become the world’s most valuable enterprise. Clue: they make the iPhone.

 

Martin Veitch is Editorial Director at IDG Connect

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Martin Veitch is Contributing Editor for IDG Connect

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