Yesterday BlackBerry had an earnings call to report on it’s first quarter. As expected it posted a loss as well as declines in its device sales with the only good news being that the subscriber base grew somewhat. The biggest news out of the call thought was that BB10 devices, running the next iteration of the BlackBerry OS (formally QNX) will be delayed until Q1 2013. This was not expected and is certainly not good news at all. BlackBerry stated the delay was as a result of integrating their OS into the BlackBerry system. The BlackBerry system involves servers all over the world compressing data and allowing for email and BBM messaging between devices. This by the way is no mean feat and as can be seen we still dont have group BBM messaging on on BlackBerry PlayBooks because of this issue. But the real kicker is that no one expected this delay. In fact rumours were abound that BB10 devices could launch earlier then expected (August/September this year).
Many in the media who have taken great joy out of kicking BlackBerry when their down will be delighted with this news. Why the media like to see a company (more to the point this company) fail I do not know. Failure results in less choice for the consumer and job losses for individuals. Anyway BlackBerry hand handed that (so called) media a giant stick with which to beat them (BlackBerry) with following this news and in some ways BlackBerry deserve this.
So what does all of this mean now? Well for one it’ll be difficult for BlackBerry to convince an already antagonistic media that they can get BB10 out by Q1 2013 without any further delays. We’ll see the iPhone 5 launch a full quarter before BB10 giving more opportunity to the competition to sign up customers. BlackBerry will miss both the “back to school” market in America and the huge Christmas market worldwide. BlackBerry will continue to hemorrhage customers and market share between now and when ever BB10 launches which will put further pressure on the companies dwindling cash reserves ($2.2 billion as of right now).
Is there anything positive to say about all of this? The fact they really want to make a perfect BB10 device and give it every chance in the competitive smartphone market is certainly honourable. Many (again particularly in the media) felt that when the PlayBook tablet launched it was missing a lot of features which it should have come pre loaded with. BlackBerry do not want this to happen again. This transition was never going to be easy but certainly it appears BlackBerry are making it seem very painful indeed.
Over the next few days and weeks we’ll see a lot of news about BlackBerry (and none of it will be good) but it’ll be the response of the once loyal fans which will be of most interest. BlackBerry has a loyal following of customers who want to see the company do well and feel that even their existing devices more then match up for “getting things done” when compared with the big boys devices despite what the media and (which lets be brutally honest is the most important group) the voting public feel.
Options for BlackBerry now are to continue to go it alone and see this through to the end for better or worse, seek a strategic partner to help it with this process (maybe Microsoft) or seek a sale to another manufacturer. Samsung are working on their own OS called Tizan as they are worried about the Google buying Motorola and iOS continuing to gain market share. BlackBerry also has a very nice patent portfolio which would help defend any company purchasing them against patent litigation (something which we see more and more being employed to gain market share much to my own chagrin). Another option is to split the company up. Sell off it’s handset division, it’s hardware (servers) around the world and focus on being an OS company. Bring BB10 OS to other manufacturers like Google has done with Android.
I think as a long term user (I’ve had 8 BlackBerry devices since 2004) I’d like them to continue to go it alone and see this through to the (bitter) end. I’ve been with the company through it’s ups and (serious) downs and I’d like to finally see their vision of the future rather than seeing them split up or sold off so close to the end. If BlackBerry do get the chance to go all the way then it’s going to be some bumpy rid before BB10 launches. It will not be a pretty 7-8 months for us crackberry’s but hey it’s really only a phone in the end. Isn’t it?
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