Nikhil Kumar: Going back to its roots is the best way for struggling mobile phones firm BlackBerry
Global Outlook: John Chen will focus on the business buyers that helped the company grow in the first place
Nikhil Kumar is The Independent's New York correspondent. He was formerly assistant editor on the foreign desk and has also done a variety of jobs on the city desk, where he wrote about markets, commodities and other business and economics topics.
Friday 29 November 2013
Talking of turnarounds, few companies face a challenge as immense as the one confronting BlackBerry.
Having abandoned a plan to sell itself, the struggling mobile phones firm has put its future in the hands of the interim chief executive and executive chairman John Chen, the former boss of Sybase, the database specialist.
He announced a shake-up of the upper ranks this week, with three top executives stepping down. At Sybase, Mr Chen won plaudits for reviving a business that, when he was brought in, was on its knees. At the time, in the late Nineties, Sybase was cutting its workforce as its stock plummeted in the face of weak sales.
Mr Chen came in, stabilised the ship and was quick to notice the opportunity presented by mobile data management. Sybase returned to profitability, and Mr Chen led its sale to SAP for $5.8bn in 2010, more than six times what it was worth when he took over 1998, according to Bloomberg.
His strategy for Blackberry will become clearer when the company announces its quarterly results next month. But, from the announcement about the executive shake-up, it looks as though he will focus on the business buyers that helped the company grow in the first place, instead of going head to head with the likes of Apple and Samsung in their battle for retail customers.
“BlackBerry... continues, by a significant margin, to be the top provider of trusted and secure mobile device management solutions to enterprise customers around the world,” he said, indicating that we might see the firm return to its roots as it tries to salvage its business.
Which could be a smart move, because it would free BlackBerry from the pressure of producing the trendiest new handset. Business customers are not going to buy a new device because it looks cool. Instead, if BlackBerry does away with fancy product launches and expensive ad campaigns, and goes back to producing reliable and secure phones that are attractive to companies (even if they aren’t always attractive to their employees), it might manage to recover.
It would still be hard work. But it seems like a better strategy than trying to catch up with Apple and Samsung, both of which are far ahead of BlackBerry.
A comScore report this month showed that the most popular smartphone platform among US users was Android (which powers Samsung phones, among others) with a 51.8 per cent market share in the three months to September. Apple was next with 41 per cent. And BlackBerry? 3.8 per cent.
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