BlackBerry Strives To Make Most Of Its Last Opportunity
The smartphone maker has the last straw to clutch to save its drowning hardware business
According to the most recent news, BlackBerry is launching two, fairly less expensive, Android powered smartphones. Many analysts have labeled this decision as the “last opportunity” for the Waterloo-Ontario based company.
The decision was taken by the company after it encountered the slow sales of its exorbitant priced PRIV. CEO John Chen said that the business plans to release two smartphones — one with full touch screen and the other one with a keyboard –but he didn’t give any specific release date of the handsets.
When BlackBerry released its first ever Google Android based smartphone, it was confident that the phone would do well in the market. It targeted the higher end of the market where the giants like Samsung and Apple reign. The device has a price tag of $700 which turned out to be too expensive for the interested buyers.
Chen remarked that many consumers recorded their opinion citing that they would have bought the phone had the price was in the range of $400. The price isn’t the only barrier which is stopping the business to have decent sales. The handset is also losing the popular features which are repelling the consumers away.
According to an analyst at Counterpoint Research, Neil Shah, the main reason for the handset to lose its value is the transition of the features. For example, BlackBerry’s once famous QWERTY keyboard, secure platform, has been taken over by touch keypad.
Over the past few years, the smartphone maker has been struggling hard to turn around the low profitability of the firm. Its last quarter’s result showed a drastic 39.8% decline in the hardware revenue. BlackBerry cited that it has recognized revenue in connection to over three million handheld BlackBerry devices in the fiscal 2016 — which has drastically decline from the previous year’s 7 million.
Previously, Chen estimated that, at an average price of $300, sale of around 3 million handsets would help the business to reach the break-even. He also told that to surrender the in-house BB OS is logical, as the handset will cost higher due to OS development and things related to it. The shift to Android is a good shift but it has a slight drawback as well. Since Google owns Android, the Canadian company cannot have full control over it. In an era where encryption has held the grounds strongly, the secure platform is essential for keeping the sales higher.
BlackBerry cannot return to its OS considering how many developers are withdrawing their apps support from the BB OS. Additionally, this is the last chance for the organization to achieve positive results. Last September, John Chen had said that he would give a year to turnaround the declining state of the company. He said, “If by September, I couldn’t find a way to get there, then I need to seriously consider being a software company only.”
Recently, BlackBerry has substantially shifted its focus on the software and services which in turn, has given strong results to the company.
Neil Shah said, “I think this is the last opportunity for BlackBerry to toy with hardware business, ideally, I believe it should focus on its software and services assets to pivot away from hardware and license its solutions to other Android vendors or service providers.”