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BleakBerry: The gloomy outlook

Tom Paye | Sept. 4, 2013
A new survey paints a bleak picture for the future of BlackBerry, with many current BlackBerry users exploring their options for a new mobile platform.

"Whether this helps the company in a material way depends on how it plans to monetise BBM on the other platforms, and whether iOS Messenger, WhatsApp and Skype users see any compelling reason to change to BBM."

Meanwhile, Ray Wang, Principal Analyst and CEO, Constellation Research, believes that, once upon a time, BlackBerry really could have cashed in on making BBM available on other platforms.

"It was an excellent move — just five years too late," he said.

BlackBerry is even being sourly tested in the enterprise world, where it is still seen as a reasonably strong brand. In the last issue of CNME, our editor, Ben Rossi, opined that BlackBerry could make a name for itself as an enterprise mobility firm. Wang agrees that BlackBerry could "focus on enterprise mobility, security and access."

But Menezes reckons that even enterprise customers can't save BlackBerry in its current form.

"While BlackBerry still enjoys a large global customer base amongst enterprises and governments, many of Gartner's corporate customers have clearly removed BlackBerry from their primary consideration set as users have requested iPhones and Android devices as their company-provided or -funded smartphone. Its share of new sales into the enterprise does not appear to be any better than sales to consumers," he explains.

Meanwhile, even traditionally favourable markets such as the Middle East have come down hard on BlackBerry in recent months. Yes, according to Gartner, BlackBerry is still one of the top five smartphone brands in the Middle East, commanding around 7 percent of the market in Q1 compared to just 2.3 percent of the US market. But in terms of overall mobile phone sales (including feature phones), the firm's Q1 market share totalled just 1.8 percent. At the time of writing, the Q2 results hadn't yet been broken down for the Middle East, but even if there was a marginal improvement, the numbers are hardly encouraging.

BlackBerry is enduring something of a perfect storm, then, and with no break in the clouds on the horizon, it's easy to see why analysts have shown concern. But what can BlackBerry do now that it has effectively acknowledged there are problems?

The committee formed by Heins et al is said to be considering joint ventures or even the sale of the company. And according to Menezes, the firm faces hard choices whatever it decides to do.

"Sales figures appear to indicate that BB10 devices have not in fact caught on in a number of key markets such as the United States. Realistic options include those contemplated in assessing strategic alternatives, including a break-up of the company's primary businesses (hardware, software solutions and services, patent portfolio) or a buy-out in its entirety by a suitor that can sustain BlackBerry while working to ensure the viability of some or all of those businesses," he says.

 

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