BlackBerry puts itself up for sale

http://theglobeandmail.com/report-on-business/blackberry-says-it-is-exploring-strategic-alternatives/article13708618/

by uladzislau • 13 years ago

112 110 13 years ago

untog3• 13 years ago

Slightly misleading title. BlackBerry has assembled a group to look at all future options- including a sale.

Seems more likely they'll partner with someone. Or maybe sell off just their hardware business. I think BB as a whole isn't going away just yet.

twerquie2• 13 years ago

I think they have stated quite publicly and explicitly: The company is for sale.

untog3• 13 years ago

BlackBerry Ltd.'s board of directors has formed a special committee to explore “strategic alternatives,” including the possible sale of the company.

Like I said, a sale is one of the things being considered in a long list of other options. But the title doesn't convey that.

bodyfour2• 13 years ago

I think the most likely endgame is that they'll pull a Nokia: either an outright MSFT purchase or becoming a heavily-subsidized client state.

* Microsoft still has plenty of cash, but is facing an existential crisis of losing platform relevance

* Their overall mobile marketshare is so low that they can probably throw that cash around with much antitrust attention

* They've had a hard time attracting hardware makers other than Nokia. If Nokia stumbles further, the whole phone platform could unravel.

* The traditional Blackberry market was enterprises, who probably would be a lot more receptive to the "windows everywhere" story than Nokia's customers ever were. Blackberry's original killer feature was arguably MS Exchange integration.

jacquesm5• 13 years ago

I highly doubt that MS will be the party to bite. BB uses a customized QnX that is about as far away from Windows Phone as you could probably go without doing something really exotic.

If that were their route they'd have to drop their investment in QnX, try to adapt all BB software to run under the latest incarnation of Windows Phone rather than to just run Windows Phone on it. BB users are quite particular about their handsets & associated software, much more so than Nokia users ever were.

Of course this could be totally wrong but I think the challenges in moving BB to Windows Phone are far more substantial than to get Nokia to convert even if BB is a smaller player.

freehunter• 13 years ago

One of the most intriguing Windows Phone handsets that I saw when WP7 first hit the market was Dell's Venue Pro [1]. It very much seemed like a Microsoft response to the Blackberry market. I was surprised when it sold so poorly and was dropped without much fanfare.

[1] http://en.wikipedia.org/wiki/Dell_Venue_Pro

general_failure• 13 years ago

Yahoo is placing a bid.

Sorry, couldn't resist.

btian• 13 years ago

This is not reddit. Please stick to facts.

AlexanderDhoore2• 13 years ago

They (or the company that buys them) should license BB10 to others. Like Microsoft does with windows mobile... It's the only path I can see for the blackberry OS to survive. Otherwise they'll be utterly crushed.

jpswade2• 13 years ago

Does the Blackberry OS need to survive?

untog3• 13 years ago

They could survive as a services company of sorts. After all, stuff like BBM is what caused them to really take off.

CaveTech• 13 years ago

The problem is Blackberry is a hardware manufacturer, so they'd need a huge volume of sales in software to make up what they would lose in hardware.

That said, BB10 doesn't really offer anything compelling above Android for manufactures, and additional hardware isn't going to massively change their market share. BB customers have never been driven by cutting edge phones. Their application marketplace is so bad that there's no reason for general consumers to want to buy into the platform.

They definitely wouldn't survive a transition to a software company.

AlexanderDhoore2• 13 years ago

So BB10 is dead then? ... He's dead, Jim. [http://www.youtube.com/watch?v=r0yXqU-w9U0]

jfb4• 13 years ago

The reason their customers buy them has nothing to do with the hardware and everything to do with BBM. The only way out for them is as a service provider on alternate (Android, Windows, iOS) platforms.

Going private may enable them to continue to do this; any purchaser that makes sense (Microsoft) would be buying their customer list and the BBM brand. Dell buying them would be a Palm goes to HP level farce.

cjoh2• 13 years ago

At 5 billion dollars of market cap, the company's worth less than what Microsoft paid for Skype. Frankly, Apple or Google should make this purchase just for their federal salesforce alone -- Blackberry knows how to do something those other companies don't do well and that's sell and entrench inside of Governments. That alone is worth billions. Give the iPhone to a Blackberry federal salesperson, and you've got billions.

at-fates-hands• 13 years ago

This was true maybe ten years ago, but even the US government is now moving away from Blackberry:

http://www.techweekeurope.co.uk/news/rim-suffers-fresh-blow-...

"Research In Motion (RIM) has suffered yet another setback as the General Services Administration (GSA), the US government’s main procurement agency, announced its decision to provide iPhones and Android devices to its employees.

Though BlackBerrys will still be available from the agency, the announcement represents a general shift away from reliance on RIM products and a move towards a bring-your-own-device (BYOD) strategy."

cjoh2• 13 years ago

Right. That's basically because employees (I used to work for the gov) want them, much to the CIO's dismay because the CIO is being better served by Blackberry sales folks than Apple's or Google's. By better served, I don't mean "taken out for golf," I mean "contracting vehicles have been set up by BlackBerry's experienced salesforce that makes this IT easy for a CIO to purchase." The SBA and many other agencies just renewed their blackberry contracts because, frankly, it was just easier for them to buy it. If you put an iPhone or an Android device into that existing framework for purchasing, it's game, set, match.

bane3• 13 years ago

Apple or Google should make this purchase just for their federal salesforce alone...

That wouldn't be a good reason for Apple to buy BB, it'd be a money losing proposition for them. The Feds have already moved on to Android phones and reversing that would take years.

jcampbell12• 13 years ago

From an acquisition perspective, the "price" is Market Cap + Debt - Cash. The total cost comes to just over $2B. At that price, I see it as a no brainer for Microsoft. They just need to ship a windows phone that is compatible with all the BB enterprise stuff, and IT departments will force it on the employees.

keltex• 13 years ago

That's not true. The market cap which is the value of all outstanding shares. Debt and cash are factored into the market cap.

simonh• 13 years ago

Slight problem there. If MS does this Nokia will drop Windows Phone like a hot stone, so in the gap between Nokia abandoning it because they won't want to compete directly with MS, and MS actually getting their own BB engineered phone out (likely to be several years), WP would have zero market presence. Surface has already royally pissed off MS laptop and tablet OEMs. This move would critically sour their relationship with the only viable WP hardware vendor.

I understand where you're coming from, and Microsoft may well come to decide that their best strategy is in-house hardware, but there's a major downside to such a move.

rorrr2• 13 years ago

From an acquisition perspective, the "price" is Market Cap + Debt - Cash

So the more debt company has, and the less cash it has, the more valuable it is? That makes no sense at all.

s_q_b• 13 years ago

Federal sales and ECC encryption patents are alone worth the purchase.

mtgx2• 13 years ago

I think Blackberry has some juicy "smartphone" patents, too, that aren't so end-of-life as Motorola's patents.

Plus, BB10 is pretty great as an OS, and has the best and most efficient multi-tasking system from what I've noticed (stuff can run in the background without a big hit on battery life, and the transition between apps is very smooth).

jacquesm5• 13 years ago

I really hope they'll do a spin-out of QnX and/or open source it under a license that allows forking. That would be a major move.

pilgrim689• 13 years ago

QNX is a huge asset to the company, raking it customers worldwide in the embedded/real-time/safety-critical software markets. Open sourcing QNX would be a major move, as in a major loss, indeed!

jacquesm5• 13 years ago

If QnX is not an asset to the buyer because for instance, they already have an OS offering of their own this might just happen to pacify the various users out there (corporate, governmental). At least like that they could be relieved of the support burden of maintaining two OS's.

icefox• 13 years ago

When BlackBerry bought QNX they removed the source code so don't hold your breath.

beagle3• 13 years ago

Was the QNX source ever available?

parfe• 13 years ago

I predict blackberry drops the hardware side and moves to a services company supporting Android and iOS.

mncv89• 13 years ago

Canonical should buy them. It would give them a platform for their Ubuntu OS on phones, instead of trying to use crowd-funding.

s9ix• 13 years ago

Introducing the Ubuntu Edge: The world's first triple booting phone, with Ubuntu OS, Android, and BlackBerry 10. That would be awesome.

Pxtl• 13 years ago

Don't taunt me with such a wonderful fantasy. Blackberry/Ubuntu is just about the only thing that would make me drop Android.

Microsoft has always been a good fit for taking over Blackberry, but MS and BB have diverged too far.

Google might just pull another Motorola move and buy them up to add to their patent portfolio.

jpswade2• 13 years ago

This would probably be the worst of both worlds.

noct• 13 years ago

Canonical has a revenue measured in millions, BlackBerry in billions.

Reality aside, it would also make them owners of QNX.

mtgx2• 13 years ago

Something really cool could come out of Ubuntu Touch and QNX if they could open source it.

GrinningFool• 13 years ago

Not quite. They've announced they've formed a committee to explore strategic options: sale, partnerships, licensing (and by extension, taking themselves private). The thing that isn't reported here is that they announced the same thing in early 2012 -- though it is the first time they've explicitly mentioned sale, and they now have one specific bank representing them.

Also of possible interest is Prem Watsa's withdrawal from the board due to conflict of interest - this may hint at Fairfax's direct involvement in sale or other negotations around taking the company private.

In any case, I hope it works out well. With the QNX-based BB10 OS they've caught up to and in some ways surpassed the competition, particularly with recent and upcoming updates.

The problem they face is three-fold: the competition is now too firmly entrenched, making it extremely difficult to get consumer and developer mindshare.

This is compounded by (and in large part caused by) the fact that they waited so long - their legacy BB OS has rendered them largely irrelevant to most people, and that's a huge hurdle to overcome.

Finally, there is a lot of carrier antipathy in the US market. Carriers are doing virtually no supportive marketing, and updates that have rolled out internationally in July won't be out in the US until late September.

Competition is heating up in the low-margin areas outside of the US that have typically bolstered their sales.

Their future is looking pretty uncertain (and I say this as someone who develops BB apps) - a manufacturing or licensing deal could provide them with what they need to keep going.

bane3• 13 years ago

This is compounded by (and in large part caused by) the fact that they waited so long - their legacy BB OS has rendered them largely irrelevant to most people, and that's a huge hurdle to overcome.

BB users are also a strange lot. The ones I know at least tend to be very conservative about their equipment choice. Hauling around 6 or 7 year old BBs because newer ones move the icons around or they don't like the keyboards or what have you. They want exactly the experience they have right now and nothing else. I've known a half dozen who bought and returned both Androids and iPhones (trying to get with modernity a little) pretty much because they weren't BBs...or at least all of their problems with the other two phones were why this or that wasn't like it was on their BB.

This has been a very big problem for Blackberry. They invest in finally modernizing and updating their hardware and software, but everybody who's not already a BB user has moved on, and the ones who've remained don't want the new stuff because it's not just exactly what they already have.

Their only chance would have been to capture the non-conservative parts of the market before they left years ago. That boat set sail long ago.

bane3• 13 years ago

Probably worth buying for the patents, sales channels and manufacturing bits. Cut most of software dev and turn them into an Android phone maker...maybe specialize on low powered, ultra long battery life phones of something.

anonymoushn3• 13 years ago

Please no, BB10 is superior to Android and already runs Android apps.

seabrookmx• 13 years ago

Already runs Android apps.

Not well. They're sluggish, and no features past Gingerbread are supported.

fnordfnordfnord2• 13 years ago

Does anyone else suspect that Blackberry/RIM's troubles might be something along the lines of what has happened to LavaBit? Wasn't their device/architecture similar to LavaBit's at least in that comm's were sent encrypted to a server either controlled by RIM, or by a third party (individual companies, gov't agencies, etc.)

Then, some time in the not-too-distant past, various world governments started making a big conspicuous deal out of getting "lawful access" to those servers.

Then, there were a few widely reported reputation damaging service outages.

Then, they became unable to design and manufacture a new phone, despite years of experience making Blackberry phones.

Given the surveillance controversy, BB ought to be "killing it" as some say, except that new BB10 devices are more like BB branded commodity smartphones, the data is no longer encrypted en-route, and the cost for "secure email" has gone up dramatically, and is licensed separately where it used to be a built-in feature.

/tinfoil

jacquesm5• 13 years ago

RIM is Canadian isn't it?

fnordfnordfnord2• 13 years ago

Yes.

jfb4• 13 years ago

No, as a moment's thoughtful speculation would make clear. The public information we have about Blackberry neé RIM is entirely sufficient to explain why they're floundering.

toyg2• 13 years ago

When governments came knocking, RIM didn't even put up a fight; before Snowden, they were largely considered the last vendor you'd ever choose, if you cared about your privacy from governments. They had the same excruciating soul-search for a new OS as Nokia, once Apple and Google leapfrogged their early-2000s shitty UIs, and then settled for a good platform when it was way too late. So I'd take the tinfoil off...

rdl2• 13 years ago

For the good of humanity, I hope someone reasonable (Google?) buys the ex-Certicom ECC patents and opens them up (free, ideally, but genuinely easy to license would be ok.)

troymc• 13 years ago

What is ECC, why is it important, and what does Blackberry currently do with their associated patents?

rdl2• 13 years ago

1) y^2 = x^3 + ax + b

2) 2048 < 256

3) ∅

dfc• 13 years ago

http://en.wikipedia.org/wiki/Elliptic_curve_cryptography

I was lucky to see the notice published in the federal register a while ago (6 or 7 years ago atleast) and made a little pocket cash when the market realized that Certichron was undervalued.

beefxq2• 13 years ago

Microsoft should buy them.

gummify2• 13 years ago

I think Huawei would bid.

beefxq2• 13 years ago

US Government would block the bid on spying grounds, oh the irony.

Takes one to know one I guess.

sirkneeland6• 13 years ago

Western governments would sooner nationalize BlackBerry than have it sold to a PRC company.

dannomatic2• 13 years ago

Amazon and Blackberry are the ideal fit. Amazon needs to gain independence from Android, they have the marketplace and the muscle to take advantage of all things Blackberry has in it's favour.

Remember they have already been in discussions in the past: http://www.dailymail.co.uk/sciencetech/article-2077067/Amazo...

Neither MSFT nor Samsung really make sense as purchasers IMHO.

jfb4• 13 years ago

The hardware business is dead and dusted. Amazon needs a platform to sell you things, not a difficult hardware business. Blackberry's only useful assets are their enterprise software and sales teams; everything else is noise.

dredmorbius• 13 years ago

And patent portfolio.

Depending on where Amazon wants to take Kindle, that could be useful.

thenewway• 13 years ago

As a Blackberry Z10 owner (who has also owned several generations of iPhones and Nokia's Lumia 920) I think BlackBerry needs to stick it out. The Z10 has a great OS. The touchscreen gestures are ingenious. The Hub (where the email and notifications are) is a fresh innovation.

The device in general is well thought out.

Also important to note that the Z10 has privacy and encryption features no other phone I know of has.

Blackberry has something good, and while Google and Microsoft continue to hemorrhage users because of trust violations, BlackBerry can win back market share. It can happen!

HorizonXP5• 13 years ago

As an Android developer by day, and a BlackBerry developer by night, it boggles my mind why everyone thinks BB10 is crap, and that no one wants it.

Spend 1 week with a BlackBerry Z10 or Q10, and you'll see how great it actually is in comparison to other platforms. Spend some time developing an app for it in Qt and Cascades, and you'll see how great it is to develop for, in comparison to other platforms.

People also need to realize that this isn't RIM; that company was big, sluggish, and full of idiots running it. BlackBerry is a much different company now. They're very humbled, and willing to listen to their customers and developers. As an example, I was looking at their Bluetooth APIs a few months ago, trying to figure out how to do out-of-band (OOB) pairing for a client. The APIs existed, but they were marked internal-use-only. I contacted their developer relations team, who put me in touch with the engineers so I could explain my use case. They said they'd review it and let me know. Lo and behold, in the new 10.2 beta SDK, those APIs are now available for all developers to use. It's one anecdotal example, but talk to others in the community and you'll hear many more like it.

bulltale• 13 years ago

I haven't used BB10 yet, but I am willing to believe you. However, I think the issue is that success on the mobile OS market is determined in a large part by the ecosystem around it. The ecosystem is heavily influenced by network effects (i.e. the more users, the higher the value of the network) en BB is way behind in this aspect. They still have many users but the amount of apps pale in comparison to Apple and Android. If Apple, Android, Windows and BlackBerry would all have started at the same time, we would have seen different results (maybe). But the simple fact remains that BB is very, very late to the game. And once market dominance is reached, as Apple and Android have, competitors can only change that dominance by being dramatically better. And I get the impression that BB10 is somewhat better.

And that is not enough.

bluedino• 13 years ago

> it boggles my mind why everything thinks BB10 is crap, and that no one wants it

The brand is ruined, much like Yahoo, Myspace or AOL.

gmrple• 13 years ago

And why can't they be remade? It seems to me once upon a time Apple was in dire straights.

corry• 13 years ago

I think you answered your own question:

"Why [does] everyone thinks BB10 is crap?" "[RIM] was big, sluggish, and full of idiots running it."

Everything you write about BB being a new nimble company may be 100% true... but public perception lags truth, especially when many people have already written them off.

The unfortunate thing is that brand/marketing has never been RIM's strong suit (a typical woe of Canadian tech giants), but it sounds like the "this-aint-your-grandfathers-RIM" story is crucial to their overall turnaround story.

grannyg00se2• 13 years ago

BB10 may be nice but the damn thing still lacks apps. There's no point having a great phone and great OS with no app coverage.

At least three times now in the past month someone has recommended an app to me an sure enough...no blackberry option. Android and iOS only.

What I don't understand is why they don't force popular apps onto their platform. Even if no companies are jumping to develop for Blackberry, pay them to do it. Get them onto your platform with no cost on their end. Pay for ongoing support if necessary. App coverage is absolutely crucial and at this point, with BB10 being what it is, I'd say app coverage is now the #1 problem for their phones.

They've gone pretty far down the crap slide now. Maybe they've given up.

HorizonXP5• 13 years ago

They have tried to pay companies for apps, and they have in the past. It isn't enough. My company is an example, as are others.

sirkneeland6• 13 years ago

If it were possible to force an app into being with money and willpower, Instagram would be on Windows Phone.

guruz• 13 years ago

I've ordered a Q10 some days ago and hope I won't regret it.

BB10 has an Android compatibility layer, so that might bring over some apps that might be still lacking.

sirkneeland6• 13 years ago

the problem is that to encourage native app development, they've made it needlessly difficult to get those Android apps over. Either they have to convince the developer to convert the .apk to a BB10 .bar file and submit to BlackBerry World, or the use has to find an .apk (a legal gray area and logistical hassle) and sideload it to the device through a process that involves no official BlackBerry tools.

dallagi• 13 years ago

I own a Q10 and I love it. Really, I didn't think that it could be so good, but now I couldn't switch to android back. of course i't just MHO.

kin• 13 years ago

Is Blackberry synonymous with RIM (Research In Motion)?

ahsteele• 13 years ago

Yes, Research in Motion (RIM) re-branded themselves BlackBerry back in January: http://www.huffingtonpost.ca/2013/01/30/rim-renamed-blackber....

toyg2• 13 years ago

RIM changed their name to Blackberry last year.

gummify2• 13 years ago

This sucks for Canada. Less than five years ago RIM/BlackBerry's share prices were trading at ~$150, now it's $10! I can see this depressing Canadian start-ups and its tech industry. Like Kodak, the main reasons for BB's downfall was their own human mistakes - complacency, hubris, and arrogance.

sirkneeland6• 13 years ago

Actually if you look at the Nokia example, quite the opposite can happen. A large, prominent, "national champion" company absorbs a huge amount of talent. As Nokia has downsized thousands of workers, they released thousands of entrepreneurs and engineers into the Finnish startup ecosystem. It's exciting times in Helsinki nowadays. The same could happen in Waterloo, and in Canada as a whole.

alexeisadeski3• 13 years ago

Every publicly traded company is always up for sale.

fingerprinter• 13 years ago

Man, the long sad story of RIM/Blackberry. They should learn something from Samsung, and Samsung should heed the history of RIM.

Blackberry made good hardware with terrible, terrible software. Samsung, so far, has focused on hardware and left the software to other people. It has allowed Samsung to focus on their core expertise and grow fast.

However, there is always the rumor that Samsung is building Tizen internally. This, IMO, would be a huge mistake. Samsung should focus on phones and leave the software to other people (Android, Ubuntu).

Realistically, I think Blackberry could do the same if they focused on their hardware and the enterprise market. If there was a high-riser who was shooting for something in Blackberry, they should be talking to Canonical right now and focus on making Ubuntu enterprise ready on their hardware. They could dominate that market for years.

BlackBerry puts itself up for sale

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