Although BlackBerry Ltd. has retreated from designing and making its own hardware, it’s possible that BlackBerry-branded devices will be more effectively delivered to market than in recent years, according to Ralph Pini, the company’s chief operating officer and general manager for devices.
BlackBerry’s new hardware strategy is two-fold, Pini told sister publication ITBusiness.ca in an interview on Friday. One prong is to explore partnerships like the one with Indonesia’s BB Merah Putih, the country’s largest device manufacturer, to increase BlackBerry’s presence in areas of the world it hasn’t accessed previously. The second is to evolve existing partnerships to promote the BlackBerry brand on a global scale, serving regions like North America, Europe, the Middle East and Asia.
While Pini said these partnerships aren’t likely to be made with tier-one OEMs, he says BlackBerry could be better off with tier-two or three OEMs than it has been in pushing its own devices to market.
“We haven’t had the capital to really promote these products … With our partners that will change,” he says. “We’re leveraging the scale of some of these partners around the globe… these partners are looking to differentiate themselves in the marketplace.”
After years of seeing its devices revenue decline and handset market share shrink, BlackBerry announced its exit from the hardware business on Wednesday. BlackBerry CEO John Chen said it will move to a royalty-based model where partners design and make BlackBerry-branded handsets, then take them to market.
Despite a strong effort with the Priv, an Android-based device that combined a touch screen with a security-boosted OS and an extendable physical keyboard, BlackBerry’s hardware revenues have continued to decline.
“When the Priv bounced, that was an indication there was a serious problem,” says Rob Enderle, an IT analyst based in Bend, Ore. “The Priv was by all measurements the phone they should have built to counter the iPhone threat, but it just came too late.”
As it has done with the Priv and the manufactured DTEK50 smartphones, BlackBerry’s version of Android features additional security software, a productivity suite around messaging and calendar tools, and a commitment to deliver patches as fast as Google releases them, to minimize the risk of zero-day threats.
BlackBerry has said for some time it’s looking for device manufacturers to partner with, but so far has found only one to go to market with: Alcatel, which makes the DTEK phones. DTEK is a test, Enderle says, a proof of concept. BlackBerry has also been working with Samsung “for some time,” he added, although no devices has emerged from that work. “Google could be a king maker” either buying or investing in BlackBerry for its device management and security prowess, Enderle said. However, he admits Google is less interested in devices today than into deep learning, artificial intelligence and autonomous vehicles, and converging the Android and Chrome platforms.
“If BlackBerry through this strategy can get a big backer – a Samsung, a Google, HTC, Motorola – then this strategy will pay off. It’s certainly a better strategy than the one they were on.”
Meanwhile, he said, BlackBerry’s brand is a strong security solution on Android, and builds on the firm’s BlackBerry Enterprise Server (BES), which is “one of the strongest platforms in managing phones.”
Pini says that BlackBerry will remain “very active” in helping its partners make BlackBerry devices, with a process built into agreements to ensure quality. BlackBerry will also send members of its own team to work on location with partners to help them meet the brand’s requirements.
“This will enable BlackBerry to bring back the brand of our devices and reenergize some of our legacy capabilities that we’re known for,” he says. “We’re now able to use that capital and apply it in a different way. The hardware design is becoming somewhat of a commodity, it’s pretty much all the same.”
The move also doesn’t mean the death of BlackBerry 10, Pini says. BlackBerry is currently working towards its 10.3.3 release for existing devices and the OS could even see new life in the future.
“I wouldn’t be surprised to see the software in another device,” he says. “But I couldn’t tell you when or where.”
In the near-term, BlackBerry will be focusing on transitioning from its current hardware approach, passing the torch to its partners. It plans to make announcements soon about partnerships that will see BlackBerry devices distributed globally.
As for the possible announcement of a sequel to the DTEK50, possibly branded as the DTEK60? “Stay tuned,” Pini says.
With notes from Howard Solomon
