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After giving up on BB10, BlackBerry abandons the high end

Last year saw BlackBerry give up plugging its operating system. 2016 sees the once-massive phone manufacturer abandon the high-end market yet still aim for the enterprise user.

The Priv was meant to be central to BlackBerry’s big revival; a quirky Android-powered smartphone that showed off the company’s strength in hardware and security, while overcoming BB10’s chronic lack of apps.

But the company only shifted 600,000 devices last quarter, which was a good 200,000 less than analysts predicted, and it seems the rest of 2016 will see the once-great company targeting the same enterprise demographic – its last and ever-dwindling bastion – at a lower cost.

In an interview with The National, BlackBerry CEO John Chen admitted that the Priv “was too high-end a product.”

“The fact that we came out with a high end phone [as our first Android device] was probably not as wise as it should have been. A lot of enterprise customers have said to us, ‘I want to buy your phone but $700 is a little too steep for me. I’m more interested in a $400 device’."

Chen said that the company plans to launch two mid-range Android smartphones this year; one with a Priv-like keyboard and one full smartphone. Whether any enterprise clients would want a mid-range Android phone, though, is another question entirely.

The company has all but given up on BB10, and as is often the case nowadays with BlackBerry, the question of abandoning hardware altogether hasn’t been ruled out. “I love our handset business, but we need to make money,” Chen said. Previously he claimed the company would need to sell five million smartphones a year to make that part of the business profitable.

“If I can’t make it profitable because the market won’t let me, then I’ll get out of the handset business.”

It’s a long road back for BlackBerry. You have to wonder whether the executives at Microsoft are starting to sweat about the upcoming Surface Phone and whether it’s even worth the effort.

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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