BlackBerry finally leans on software to gain in smartphone world
Months after surviving with diminishing sales, BlackBerry has now decided to put all its efforts on software and would stop manufacturing smartphones at its own facilities. This new decision is touted to the “right move” to garner profits in the future.
Originally established under RIM, the BlackBerry lineup was ruling the high-end mobile handset market in the 90s and early 20s. But the arrival of iOS and Android spoiled its game. The Ontario-based company had even took some favour from Google and brought its anticipated Android-running Priv in 2015. However, that development wasn’t much fruitful for the Canadian giant.
“Today we make our first significant step toward leading as a software company by announcing that we are transitioning from doing internal handset hardware development to leveraging our third-party partner to provide that function. This is what the future looks like for our business, and it is the right move as we progress towards profitability,” wrote Ralph Pini, chief operating officer and general manager — mobility solutions, BlackBerry, in a blog post.
BlackBerry has already chosen a joint venture called BB Merah Putih to source, distribute and market its handsets in Indonesia. Led by PT Triphone and Merah Putih, the new venture will enable the creation of locally-sourced devices in the Indonesian market. This would set the stage of other similar partnerships, and India is likely to be the next target market for the handset maker.
“There are both strategic and financial benefits to our new approach. By continuing to bring BlackBerry devices to market, enterprise customers and consumers will still enjoy our unmatched, end-to-end value proposition which includes best-in-class capabilities in security,” Pini added.
Apple responded to BlackBerry’s strategy, albeit in low-tone. Tim Cook, CEO of Apple, in an interview with Financial Times, suggested that the development emerged as an opportunity for the iPhone maker.
“I think their [BlackBerry] sales have been fairly low for a while,” Cook said. “We are very focused on the opportunity, and we see it as massive.”
Not a fresh approach
The approach of reaching third-party manufacturers for developing new handsets is not fresh for BlackBerry. In December 2013, Taiwanese manufacturer Foxconn partnered with BlackBerry to start making handsets for the company.
The BlackBerry-Foxconn partnership developed affordable models like the BlackBerry Z3 to improve the market position of the company.