The BBRY Café. [Formerly: I support BBRY and I buy shares!]
View Poll Results: Did you buy shares ?
- Voters
- 1129. You may not vote on this poll
-
-
- Interesting.
BYOD: When 800,000 Apps Becomes A Bad Thing
BYOD: When 800,000 Apps Becomes A Bad Thing - Seeking Alpha
Mar 14 2013, 07:17 by: Kerry Olauson | about: BBRY, includes: AAPL, GOOG Disclosure: I am long BBRY. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)
The BlackBerry (BBRY) Z10 is now available for pre-order in the United States - a milestone for the battered smartphone maker. In recent years, market share has been dominated by Google's (GOOG) Android platform and Apple's (AAPL) iPhone.
Many are skeptical of the success of the Z10. Bearish investors point to the lack of apps as being the major deterrent to the new smartphone. With the advent of BYOD (Bring Your Own Device) to many enterprises, these same bearish investors believe that BlackBerry has lost its niche market. This article will outline why this may not be entirely accurate.
Open Source versus Closed Source Platforms
"Open source" and "closed source" refers to whether or not a manufacturer makes the source code (computer code) available to developers to develop software for the platform. A good example from decades past is the old personal computer battles between Apple (closed source) and Microsoft (MSFT) (open source). Smartphones are basically mobile computers, so this analogy is somewhat fitting for the current smartphone BYOD debate.
Of the three smartphone manufactures mentioned in this article, Android is open source. Apple and BlackBerry are closed source devices. This is important to note for enterprises considering BYOD. The open source platform is wonderful for building market share, which is what helped propel Microsoft in the personal computer market. However, the bigger a company gets and the more ubiquitous its platform become, the more it becomes a target of malware (malicious software like computer viruses).
A recent study by Bit9 has shown that of the 400,000 apps that they tested on Google Play (the app store for Android), approximately 100,000 "may pose security risks". If this is extrapolated to the entire Android app population, this could mean 250,000 apps that are deemed unsafe. Of course, Google is vigilant in providing the safest environment possible, and they do regularly monitor Google Play. Google Bouncer is an in-house automated anti-virus system designed to remove malicious apps on the marketplace, and is credited with reducing malware by 40%.
Android Does Not Fully Match the Microsoft Analogy
So, you may be thinking, "Well, if Microsoft was open source and dominated business computing, then surely Android will dominate with open source phones." This I believe to be wrong.
The difference between Microsoft computer dominance and Android smartphone dominance with respect to BYOD, is that you never connected your personal home computer to your corporate network. Granted, there are people that work with laptops (either their own or a company laptop). However, for large organizations with many users on their networks, this is still the exception. Managing apps that are on your personal smartphone is a completely different issue, and a difficult one to navigate for corporate IT departments.
A risk announced by Symantec highlights how risky "open source" phones can be. The threat is called SuperClean, and will send contact lists, images, etc. to an external server. To directly quote the Symantec Blog post:
"In effect, SuperClean turns any Android phone into the equivalent of a compromised thumb drive. This means any employee who brings their Android phone into the office and plugs it into their computer to recharge could compromise their entire network. While we have seen malware that moves from PC to phone, this is the first time that we have seen malware that jumps from phone to PC. But this method is remarkably simple so I would expect to see it repeated in other malware."
Again, this is something that Google will have to work hard on to manage.
Apple is the Second Best, Closed Source Smartphone for BYOD
So, if you have read this far, then you must be thinking the obvious choice of the three platforms is Apple. Again, I would disagree. Although, there is no dispute that Apple makes quality products and do offer a plethora of apps, there is one thing that separates the new Z10 from the rest for BYOD: Balance Technology. The BlackBerry Balance Technology is a unique feature for smartphones, in that it will allow two environments for the phone to exist in - both a personal environment and a work environment.
What this means is that a user can bring in their BlackBerry Z10, and corporate IT will have complete confidence that the user's personal apps will not be able to access work related information. These environments will be kept completely separate from one another.
This functionality in the Z10 is what has led to recent large orders by such enterprise customers as the German Government. Reports indicate that the German Government has secured 40,000 enhanced Z10 smartphones at a cost of approximately $3,000 each (enhanced with a new micro-SD from Secusmart). The bigger picture is that these phones will meet NATO standards for security. NATO represents 28 governments throughout Europe and North America. This is a very strong endorsement for the Z10, in my opinion.
Why the BlackBerry Z10 is Your Best Choice for BYOD
Finally, I would like to summarize BlackBerry Z10 features (in order of importance) as they relate to BYOD. This list outlines why I believe the Z10 is your best choice for BYOD.
1. A Superior Closed Source Environment
This, without a doubt, is the most fundamental concern for BYOD (which has also been called Bring Your Own Danger). As the title of this article implies, 800,000 apps is not a good thing when it comes to BYOD environments. The BlackBerry Z10 has come to the American marketplace with approximately 90,000 apps that are developed for their closed source platform. Compare this to Android's 800,000 open source apps, and from a corporate IT perspective… you suddenly see real value in the Z10. This is a major disadvantage for the Android platform, and is the main reason the Z10 should be considered a superior product for BYOD.
2. Balance Technology
As I have mentioned earlier, this alone separates the Z10 from the iPhone (which is why I have placed it second on my list for BYOD). I feel that this functionality has not received enough attention and has been somewhat passed over. Balance Technology is fundamental to the BYOD trend - all BYOD phones should have this functionality. This allows users to bring their personal phones to work and have full confidence that their apps will not harm corporate IT networks, as well as maintain their privacy. You simply sign-in and out of each environment. This is like having two phones in one.
3. QNX Operating System
Third on my list (and my personal favorite), is the QNX operating system (OS). There is no point in listing phone features without also including a great operating system. The Z10 has the best OS on the market - hands down. What separates the QNX OS from Apple and Android is that it has a microkernel based OS. Apple iOS is a hybrid kernel and Android is a monolithic kernel. The significance of this is that BlackBerry Z10 developers are able to streamline applications making them much more efficient, reliable and secure.
QNX systems are found throughout the world, and through a wide range of products. Computer systems that cannot be allowed to fail use QNX, like nuclear power stations, automotive systems, 9-1-1 dispatch systems, etc. Car manufacturers like Acura, Audi, BMW and Porsche (POAHF.PK) use QNX systems to help run their vehicles. QNX systems are even able to park your car without you in it! The QNX OS is another reason why the BlackBerry Z10 is superior to Apple and Android products.
4. BlackBerry Protect
BlackBerry Protect is a great feature for BYOD usage. Should an employee lose their phone, they are able to access it remotely. They can either choose to lock the phone, or completely delete the contents of the phone (including the micro-SD card). Other options are the ability to locate your phone on a map, as well as calling your mobile network to take action on your behalf - great features for BYOD.
5. Premium Features like Hub, BBM, Multitasking, and Keyboard
These are more convenience features that are nice to have, and are not essential for BYOD consideration. The BlackBerry Hub allows the user to manage all of their messages in one location. Multitasking allows the user to run multiple applications at once. For example, you are on the phone but need to access your calendar - the Z10 will let you do this. Therefore, you are not required to close an application down to open another. I have also included links to the new BlackBerry Keyboard which has the ability to track the users typing behavior to assist in communication.
Full Disclosure
In closing, I would like to disclose that I currently own an Android product. I have been very happy with it as my personal phone. I have never owned a BlackBerry or Apple smartphone. I believe all three are quality products, however my intention with this article is to highlight why I feel the BlackBerry Z10 is a strong contender in the BYOD debate. I also feel that enterprise customers would be wise to continue to encourage BlackBerry products with their employees. With six BlackBerry 10 smartphones scheduled for release in 2013, there should be lots to choose from.03-14-13 07:29 AMLike 0 - Personally this rally came 3-4 days ahead of my schedule, I was expecting further drop for short covering. But now that short interest has been released it's obvious that shorts have no intention of covering so this thing will probably sit high ahead of earnings. My original target going into earnings was ~$15.5. This yet still might hold true. Will play the swings until then but going into earnings I'm betting on "mostly" positive outcome and will play puts/calls accordingly.bungaboy and Acumenight like this.03-14-13 07:30 AMLike 2
- I find that when stocks should go up they dont. Just from my experience.When you say theres no way it will be down today the stock usually goes down haha. Anyways I hope for a big jump in either direction. I want some calls or puts but want this to go higher or lower. Of corse now that I said I expecft it to drop today it will probably go up 17% always the opposite hahahbungaboy and Steve Rizla like this.03-14-13 07:36 AMLike 2
- My take, FWIW.... Since the launch the professional shorts have been trying to shake out the weak, retail stock holders by pushing the stock down when they can. They were mildly successful for a while. Now the shoe is on the other foot for the next 2 weeks. Week, retail shorts are likely panic, maybe even get margin calls and be forced out. However, I think, and have no way to know for sure, that most of the shorts are the big boys. They are going to absorb all of this good/great news and the ER, playing rope-a-dope and absorbing body blows hoping to live to fight after ER. Then they will pounce downplaying all the positives and trying to push the stock down. If sales are good but not great or the buzz starts to die, they will smell blood and go for it. We will see who wins, I am not convinced either way yet though I hope the folks who post here are correct. I just haven't seen compelling evidence yet that BB10 will stay hot for more than the next month or so. Then again, I won't have my BB10 until the 28/29th. In my view we have confirmation that the launch is going well, but I don't know enough yet to invest. The 1M order is great, but if it is AT&T or Verizon and it is for Z10 and Q10 then its not really earth shattering, they will each need to sell millions to make BB10 a US success.
I just ordered my Z10 for 3/28 delivery, I'm doing my part and psyched!!!
Good luck to everyone, the next 2 weeks could be a wild ride!03-14-13 07:37 AMLike 2 - Entertaining reading. Consider it's source but we need guys pushing for our side too.
BlackBerry Z10 Already A Winner
Mar 14 2013, 08:24 by: jaberwock | about: BBRY Disclosure: I am long BBRY. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More...)
Less than four weeks ago, analysts at Pacific Crest and Canaccord issued a downgrade of BlackBerry (BBRY), with a $9 target price and a sales forecast of 300,000 Z10 phones for February. James Faucette of Pacific Crest, who has been bearish on BlackBerry since before the Z10 launch, also rated the chances of BlackBerry's new line of phones being a success at less than 1 in 10.
In the days following the Z10 launch on January 25th, the news for BlackBerry was mostly bearish. Firstly, the company announced that the launch in the USA would be delayed, then we had news of Home Depot (HD) switching to the iPhone (a decision which most likely was made long before the launch of the Z10). These news items were accompanied by analyst downgrades. Doom and gloom articles with titles such as "Is the BlackBerry Z10 already a flop?" could be read daily on all of the financial websites.
The share price had dropped from $18 just prior to the launch date, to about $12.50 by March 5th , and the number of shares sold short had risen to over 147 million (28% of the float) as of February 28th.
Meanwhile, in the real world, where analysts never seem to tread, something totally different was happening:
People who buy the phone like it. They like it so much that they tell their friends about it, and their friends buy it. They post comments on the internet and those comments are overwhelmingly positive. People love the Z10 operating system, there is no doubt about that. There is an old adage that if you make a better mousetrap, the world will line up at your door to buy it. BlackBerry has made a better mousetrap.
Customer satisfaction surveys have rated the Z10 as the best phone on the market today.
The company has said that sales have exceeded expectations, and that a significant number of customers are switching to BlackBerry from the Apple (AAPL) and Google (GOOG) Android platforms
One retailer in Canada has stated that the BlackBerry Z10 is leading the smartphone sales in its stores
BlackBerry has stated that is has increased production of the Z10 phone to keep up with demand
The German government has committed to use the BB10 operating system, and will purchase at least 5,000 phones
An expected 5 days supply shipped to India sold out in two days
A report in Barron's that said orders to component suppliers have been increased by "orders of magnitude", to levels approaching those of 2011
A BlackBerry partner has placed an order for 1 million phones (the largest ever single order in BlackBerry history).
There have been a few articles by sell side analysts who don't seem to believe what is happening. One rather silly article, again from Pacific Crest, tried to claim that a build-up of inventory at some U.K. stores indicated that sales of the phone had stalled, when in fact the inventory build-up was more likely an attempt to keep sufficient stock on hand to meet demand. The Canaccord analyst increased his sales forecast for February by a factor of 2.7, but he tried to put a negative spin on it, and reiterated his sell rating.
The simple fact is that in the last couple of weeks, there has been a definite swing in sentiment. The news articles which point to a successful launch of the Z10 phone now exceed those which are critical of BlackBerry. Also, throughout the period since the launch, the positive news articles have generally come from more reliable sources than the negative articles.
Although he is still trying desperately to push the bearish viewpoint, it looks increasingly like Mr. Faucette's ten to one long shot is heading towards the winner's circle.
In previous articles, I have made an evaluation of BBRY for three different scenarios, and a forecast of sales. I am sticking with my sales forecast of 7 million BB10 sales per quarter. I have made a small change in my financial model to change the gross margin on services to 80% (from 50%), and I have adjusted the gross margin on older model phones to zero.
Quarterly Revenue
Z10 and Q10 sales (Units) 7,000,000
Z10 and Q10 income (millions) 3850
Older phone models revenue 900
Services and software revenue 1000
Total revenue (billions) 5750
Quarterly expense
Z10 and Q10 costs 1833
Older phone model costs 900
Services and software costs 200
Launch costs 500
Selling, general and admin costs 500
R & D costs 500
Total expense 4433
EBITDA (quarterly) 1317
EBITDA (annual) 5270
Enterprise value 26348
Share value $ 50.21
My revised forecast is $50 per share, and I have not taken into account possible licensing deals or takeovers. The upcoming short squeeze could temporarily push the price much higher.cjcampbell and m0de25 like this.03-14-13 07:50 AMLike 2 - Here we go with analyst updates.
RBC hikes BB10 Q4 forecasts, 'numerous data points suggest Feb quarter BB10 sellthrough is stronger than Street forecasts'
http://www.streetinsider.com/Analyst...l?si_client=st03-14-13 07:51 AMLike 9 -
Of course, these apps won't have access to data stored in the "Work" side of things unless they were installed to that side. But that part won't matter once it happens - tech bloggers will downplay it in favor of pointing out how "weak" BB's vaunted security is.Last edited by Marc_Paradise; 03-14-13 at 08:08 AM. Reason: correctness
03-14-13 08:00 AMLike 0 - Here we go with analyst updates.
RBC hikes BB10 Q4 forecasts, 'numerous data points suggest Feb quarter BB10 sellthrough is stronger than Street forecasts'
StreetInsider.com - BlackBerry (BBRY) Z10 Could be Recapturing Lost Users - Analyst03-14-13 08:02 AMLike 0 -
- 03-14-13 08:34 AMLike 0
-
-
- Profit taking and new shorts thinking (correctly) that this was a well-orchestrated spin from BBRY. They're rather foolishly betting on no new good news coming out today.OMGitworks and bungaboy like this.03-14-13 08:36 AMLike 2
-
- The only sells are the short sells. Without short selling BBRY would be well over$20. The shorts manipulate the free market by selling when no would be selling causing traders to act on the selling which creates more selling by then getting stops hit. There is a reason why a good majority of the world took their capital out of the US and told them to play with themselves. No reason after yesterdays news that BBRY should be trading below their $19 book value. New HIT phone ....NO value?03-14-13 08:42 AMLike 5
- Forum
- Popular at CrackBerry
- General BlackBerry News, Discussion & Rumors
- BBRY
The BBRY Café. [Formerly: I support BBRY and I buy shares!]
Similar Threads
-
The importance of a removable battery.
By krzyabn in forum BlackBerry KEY2Replies: 45Last Post: 04-15-19, 10:12 PM -
Motion support - Vibration no longer working and I need advice!
By bunnyraider in forum BlackBerry MotionReplies: 1Last Post: 04-12-19, 09:42 PM -
Will BlackBerry Launcher ever give us the option to swipe up?
By ikeike859 in forum BlackBerry Android OSReplies: 8Last Post: 04-12-19, 06:27 PM -
In MIXplorer, what is the "archive?"
By RLeeSimon in forum Android AppsReplies: 3Last Post: 04-12-19, 05:00 PM -
Skype Preview brings screen sharing to Android and iOS
By CrackBerry News in forum CrackBerry.com News Discussion & ContestsReplies: 0Last Post: 04-12-19, 01:51 PM
Tags for this Thread
LINK TO POST COPIED TO CLIPBOARD