1. jake simmons3's Avatar
    What would that mean for the shareprice etc
    08-19-13 03:24 PM
  2. Troy Tiscareno's Avatar
    The vast majority of the revenues that BB makes come from the sales of phones, plus the service revenue from the legacy phones, which is quickly dropping off as the installed base of BIS users is lost.

    Then BB would have to find a manufacturing partner willing to take the risk of manufacturing devices and licensing the OS. Given the lack of ecosystem, and BB's inability to complete successfully, I don't imagine there being any takers. They've been looking for a potential JV for at least a year, with no solid interest that has been reported.

    Remember too that BB doesn't actually manufacture these devices, just like Apple doesn't: the manufacture is outsourced to Foxconn, though it seems that BB phones are assembled in a Mexican factory rather than in China. Obviously the components come from Asia. The point being that BB's connection to the hardware business is that of R&D and design, so they could lay off those folks and push those costs onto their OEM, but again, if BB can't make it work, why would an OEM, with higher costs due to OS licensing, believe they could do better?

    Finally, this could cause BB to lose some government and business contracts, especially if the OEM was a Chinese-owned company. Some BB users are very sensitive to those issues, especially governments.

    Perhaps the most important thing is that the hardware really isn't BB's problem at all. While their phones may not be cutting-edge in terms of hardware, there's nothing intrinsicly wrong with the hardware. BB's problems are:

    • Lack of ecosystem (apps, cloud services, media)
    • Badly damaged brand which will be expensive to repair and will take years of flawless execution to do so.
    • Money to buy premium floor/counterspace in carrier and electronics stores, create marketing materials (kiosks and displays), and train (and keep a close eye on) sales reps at carrier stores (a TON of money for all this).
    • Completely out-of-touch advertising, also poorly executed.
    • An unintuitive OS that is very confusing to new users (including legacy BB users) and does poorly on the "60-second in-store evaluation" test.
    • Significant bugs and missing features in the OS, along with slow OS updates in the US (and a few other) markets.


    None of those problems are solved by dumping internal hardware development, and all of those problems work against BB finding a partner willing to take the risk and expense of being BB's OEM (as Nokia has essentially become for Microsoft, though at the cost of Microsoft paying Nokia $1B a year for 5 years).
    rodan01, kbz1960 and anon1727506 like this.
    08-19-13 07:29 PM
  3. jhowe204's Avatar
    BB's problems are:

    • Lack of ecosystem (apps, cloud services, media)
    • Badly damaged brand which will be expensive to repair and will take years of flawless execution to do so.
    • Money to buy premium floor/counterspace in carrier and electronics stores, create marketing materials (kiosks and displays), and train (and keep a close eye on) sales reps at carrier stores (a TON of money for all this).
    • Completely out-of-touch advertising, also poorly executed.
    • An unintuitive OS that is very confusing to new users (including legacy BB users) and does poorly on the "60-second in-store evaluation" test.
    • Significant bugs and missing features in the OS, along with slow OS updates in the US (and a few other) markets.


    None of those problems are solved by dumping internal hardware development, and all of those problems work against BB finding a partner willing to take the risk and expense of being BB's OEM (as Nokia has essentially become for Microsoft, though at the cost of Microsoft paying Nokia $1B a year for 5 years).[/QUOTE]

    Excellent points ! Here's hoping some higher ups at BlackBerry actually read these threads and see what the people are saying. This is what I would say.

    1) What do you think it would cost Apple or Google to open up their stores? It might be worth it.
    2) Now-a-days it's more just the mainstream media talking smack than actual customers of BlackBerry. Hopefully this goes away over time but it all depends what happens to this unfortunately struggling company. I would love to see Canada come to the rescue in the same way the USA did for the car companies.
    3) I agree that their commercials are boring and barely show off any of the unique features the phone has.
    4) The OS is actually amazing! I know there's a bit of a learning curve but it is by far the best in my opinion because you're not limited by having a home button, not to mention having all texts, email, calls etc together in the hub.
    5) The OS updates aren't any slower than apple and all the bugs and features lacking in 10.0 and 10.1 are fixed in the 10.2 leak I'm using so hopefully they release it soon.
    6) Hopefully the Z30 will be released in time for Christmas in the states and those delayed USA releases are killing them.
    7) Hopefully they release another high end keyword device and a BB10 slider because that is what the people want.

    We all know this is a highly competitive market space but I know that BlackBerry can at least compete. I would be okay though with Lenovo manufacturing BlackBerry as long as they keep the name and the software. If you could open up the Google app store or the dieing apple store then we're in business. I can't help but feel some kind of takeover or partial takeover is inevitable though.


    CB10 on the Z10
    Last edited by jhowe204; 08-19-13 at 10:03 PM.
    08-19-13 09:42 PM
  4. Troy Tiscareno's Avatar
    Google isn't going to change the requirements to access the Play Store. Companies that want access to the Play Store have to join the Android Alliance, have to offer a Google-certified version of Android, have to pre-load all of Google's primary apps, and they cannot offer any other Android-based OSs (of which BB10 would qualify as long as it had the Android runtime in it) or any alternative markets that would compete with the Play Store (at least, for their Android OS).

    BB's time to choose to throw their hat in with Google was about three and a half years ago, around the time they bought QNX, and before any work had been done on BB10. There's simply no way to switch gears now. There is simply zero chance that BB will ever get direct access to the Play Store, and less than zero of a chance that they'd ever be given access to Apple's App Store.
    08-19-13 11:12 PM
  5. Im Mo Green's Avatar
    The vast majority of the revenues that BB makes come from the sales of phones, plus the service revenue from the legacy phones, which is quickly dropping off as the installed base of BIS users is lost.

    Then BB would have to find a manufacturing partner willing to take the risk of manufacturing devices and licensing the OS. Given the lack of ecosystem, and BB's inability to complete successfully, I don't imagine there being any takers. They've been looking for a potential JV for at least a year, with no solid interest that has been reported.

    Remember too that BB doesn't actually manufacture these devices, just like Apple doesn't: the manufacture is outsourced to Foxconn, though it seems that BB phones are assembled in a Mexican factory rather than in China. Obviously the components come from Asia. The point being that BB's connection to the hardware business is that of R&D and design, so they could lay off those folks and push those costs onto their OEM, but again, if BB can't make it work, why would an OEM, with higher costs due to OS licensing, believe they could do better?

    Finally, this could cause BB to lose some government and business contracts, especially if the OEM was a Chinese-owned company. Some BB users are very sensitive to those issues, especially governments.

    Perhaps the most important thing is that the hardware really isn't BB's problem at all. While their phones may not be cutting-edge in terms of hardware, there's nothing intrinsicly wrong with the hardware. BB's problems are:

    • Lack of ecosystem (apps, cloud services, media)
    • Badly damaged brand which will be expensive to repair and will take years of flawless execution to do so.
    • Money to buy premium floor/counterspace in carrier and electronics stores, create marketing materials (kiosks and displays), and train (and keep a close eye on) sales reps at carrier stores (a TON of money for all this).
    • Completely out-of-touch advertising, also poorly executed.
    • An unintuitive OS that is very confusing to new users (including legacy BB users) and does poorly on the "60-second in-store evaluation" test.
    • Significant bugs and missing features in the OS, along with slow OS updates in the US (and a few other) markets.


    None of those problems are solved by dumping internal hardware development, and all of those problems work against BB finding a partner willing to take the risk and expense of being BB's OEM (as Nokia has essentially become for Microsoft, though at the cost of Microsoft paying Nokia $1B a year for 5 years).
    What if bbry themselves shut down the hardware division. The estimate today that was quoted would be 800 million to shut it down. BBRY then moves forward as a pure software play.
    08-21-13 12:57 PM
  6. anon1727506's Avatar
    What if bbry themselves shut down the hardware division. The estimate today that was quoted would be 800 million to shut it down. BBRY then moves forward as a pure software play.
    What software?

    BB10 - If BB10 isn't gaining traction now - why would anyone want to use it. The major reason (but far from the only) for the failure of BB10 so far is lack of apps, that isn't apparently changing anytime soon, so the OS is about as useful and valuable as WebOS. There is value there, but not as sustainable mobile platform. Especially if one had to PAY to license it. BlackBerry is not Google, they can't afford to sell it nearly so cheaply without other revenue streams to offset the losses.

    BES software - without BlackBerry hardware as a leader, BES10 is a very expensive option of IT departments. They did just drop pricing (temp or permanent?), but BES10 relies on BlackBerry network, which relies on the BlackBerry company being is business. Too many questions are being raise about the future of BlackBerry to risk a major investment in their MDM right now.

    QNX - Yes it is great software, not sure how valuable it is. $40 or 50 million a year is not going to support a very large company.

    As others have stated BlackBerry get a BIG portion of their revenues from hardware sales, take that away and there isn't a lot left.

    It is much easier to grow and small company into a big company, than it is to shrink a big company down to a small company. BBRY could make a niche for itself as a corporate/gov device only. They could charge a lot more and for a while be profitable (at some point Andorid and iOS would catch them here too). But getting down to that scale from where they are now.....
    08-21-13 01:35 PM
  7. Im Mo Green's Avatar
    What software?

    BB10 - If BB10 isn't gaining traction now - why would anyone want to use it. The major reason (but far from the only) for the failure of BB10 so far is lack of apps, that isn't apparently changing anytime soon, so the OS is about as useful and valuable as WebOS. There is value there, but not as sustainable mobile platform. Especially if one had to PAY to license it. BlackBerry is not Google, they can't afford to sell it nearly so cheaply without other revenue streams to offset the losses.

    BES software - without BlackBerry hardware as a leader, BES10 is a very expensive option of IT departments. They did just drop pricing (temp or permanent?), but BES10 relies on BlackBerry network, which relies on the BlackBerry company being is business. Too many questions are being raise about the future of BlackBerry to risk a major investment in their MDM right now.

    QNX - Yes it is great software, not sure how valuable it is. $40 or 50 million a year is not going to support a very large company.

    As others have stated BlackBerry get a BIG portion of their revenues from hardware sales, take that away and there isn't a lot left.

    It is much easier to grow and small company into a big company, than it is to shrink a big company down to a small company. BBRY could make a niche for itself as a corporate/gov device only. They could charge a lot more and for a while be profitable (at some point Andorid and iOS would catch them here too). But getting down to that scale from where they are now.....
    There is no future in the hardware side. This company needs to shrink in size, could they not be a pure MDM play. like mobile iron. If they go private, I believe that will be the path they will go, no more hardware
    CHIP72 likes this.
    08-21-13 01:58 PM
  8. lc474's Avatar
    BlackBerry has painted themselves into a corner, and the paint isn't gonna dry anytime soon...
    08-21-13 02:10 PM
  9. Kris Erickson's Avatar
    [*]An unintuitive OS that is very confusing to new users (including legacy BB users) and does poorly on the "60-second in-store evaluation" test.[*]
    How is
    1) Swipe up- Unlock phone
    2) Swipe Left - goto last used and rest of apps
    3)Swipe UP and to Right - peek into and open Hub

    That's it.. 3 gestures. How dumb of an individual must you be not to understand or get this. 2/3 of those ppl use right now, Swipe left Iphone to look at all apps, Swipe up (ok I think its down) Android to unlock and I think iOS7 for Apple is doing Swipe up to unlock . So really one new gesture.. grrr...
    08-21-13 05:21 PM
  10. Troy Tiscareno's Avatar
    It doesn't matter. People go into a cell phone store and pick up the device, and they can't figure it out in 2 minutes like they can with iOS, Android, or even WP. So they put it down and buy something else. Or they buy it, and return it a couple of days later because they can't easily pick it up, or forget which gestures mean what.

    You and I both agree that, with time, most people could figure it out. The problem is that people want things that "just work" for them from the moment they pick them up. That's what "intuitive" means: it's OBVIOUS to a new user how to use the device.

    Many great, powerful, advanced consumer products have failed on the market because their interfaces weren't intuitive and people couldn't figure them out (at least, not right away). All of those products had a small group of people who LOVED the devices and vigorously defended them, but that didn't stop them from failing.

    If BB had $3B a year to spend on high-quality TV ads to teach people how to use BB10's interface, then maybe that would all be fine, because people would walk into the store knowing what to expect. The reality is that even existing BB users, some who had watched the YouTube videos and had some idea of what to do still struggled with the interface. That's a MASSIVE problem for BB, because it means they aren't able to convert their legacy installed base to BB10. You can see the truth of that in the conversion numbers (or lack thereof).

    You may hate home and back buttons, but if BB10 had them from Day 1, then likely all of these users who passed on BB10 because the UI confused them might own BB10 devices today. It seems clear right now that BB tried to make too big of a leap from the legacy UI to the current one, and many of their users just couldn't make the jump. Had they launched with a conventional UI, built an installed base and converted most of their legacy users over to BB10, and then, a couple years down the road, switched to the gesture UI, I believe they'd have seen a lot more success, at least as far as "in-store experience".
    Laura Knotek likes this.
    08-21-13 05:34 PM
  11. Mudassir Ayub's Avatar
    PsA

    Posted via CB10
    08-26-13 06:49 AM
  12. CHIP72's Avatar
    Honestly, I don't think Blackberry will be able to sell their hardware division.
    08-26-13 10:35 AM
  13. CHIP72's Avatar
    There is no future in the hardware side. This company needs to shrink in size, could they not be a pure MDM play. like mobile iron. If they go private, I believe that will be the path they will go, no more hardware.
    That is my thought as well.
    08-26-13 10:36 AM
  14. app_Developer's Avatar
    There is no future in the hardware side. This company needs to shrink in size, could they not be a pure MDM play. like mobile iron. If they go private, I believe that will be the path they will go, no more hardware
    I'm still having a hard time connecting the dots on going private. After a buyout, and the costs of winding down the hardware business, is their software/MDM solution going to drive enough $$ to justify the investment?

    I suppose it could be if they sold the patents and other assets, maybe?
    Last edited by app_Developer; 08-26-13 at 12:45 PM.
    08-26-13 10:45 AM
  15. Superfly_FR's Avatar
    Why would BlackBerry sell their hardware division? It IS (and was prior to BB7 erra) a big profit division. Volume is too low at the moment to make it obvious, but... I cannot see - besides some nerds octoprocessors dreams - how this could be profitable.
    A bullet in the foot IMHO. Nothing to win here.

    Posted via CB10
    08-26-13 11:27 AM
  16. FFR's Avatar
    Why would BlackBerry sell their hardware division? It IS (and was prior to BB7 erra) a big profit division. Volume is too low at the moment to make it obvious, but... I cannot see - besides some nerds octoprocessors dreams - how this could be profitable.
    A bullet in the foot IMHO. Nothing to win here.

    Posted via CB10
    And what happens when volume falls further?
    OPEX starts to creep up.
    How much runway will they have after they burn through their reserves.

    Look at what NEC, they didn't even bother to sell their phone division.
    08-26-13 01:55 PM
  17. Triplell's Avatar
    I don't understand why selling the HW division would turn the company around. Almost everyone I know who owns a BlackBerry does so because they enjoy a smartphone with a physical keyboard. Of that group is a large subset who hate the performance of their phone compared to the competition.

    I myself would much rather get used to a touch screen device than continue using another OS that continues to suffer from performance issues.
    08-26-13 04:52 PM
  18. CHIP72's Avatar
    I don't understand why selling the HW division would turn the company around. Almost everyone I know who owns a BlackBerry does so because they enjoy a smartphone with a physical keyboard. Of that group is a large subset who hate the performance of their phone compared to the competition.

    I myself would much rather get used to a touch screen device than continue using another OS that continues to suffer from performance issues.
    It probably costs a lot more money for Blackberry to manufacture smartphones than it does for them to maintain some of their core software services like BBM. They are also more exposed financially if they manufacture but fail to sell units compared to having their software user base fall slightly.
    08-26-13 05:30 PM
  19. Kris Erickson's Avatar
    I read in a SA article today that the writer basically disagrees with valuation of BB hardware side at 0%. He basically stated that any division that turns a profit over manufacturing has value to the company's other expenses. So for example if the Z10 costs 200 to make and at launch they are selling for 450 then that extra 250 can offset other loss/expenses.
    08-26-13 09:07 PM
  20. dusdal's Avatar
    Sounds logical.

    If it is profitable and back to growth, it must have some value.

    Posted via CB10
    Superfly_FR likes this.
    08-27-13 12:40 AM
  21. m1a1mg's Avatar
    Sounds logical.

    If it is profitable and back to growth, it must have some value.

    Posted via CB10
    It does sound logical. But logic seems to be missing for the last 7 months. I don't claim to be an expert, and I've read the different theories that BBRY intentionally played down the Z10, but there must be a point at which BBRY can not reasonably order new phone manufacture without the set ability to sell said phones. That's where I think the "experts" are getting the idea that it will cost to shut down the hardware division. BBRY has to set some limit of how many phones, or pieces of phones, they want prior to a subcontractor agreeing to build. BBRY commitment to new builds is what has these "experts" so worried about the hardware division. Basically they've committed to buy pieces and parts that they may never be able to sell. Especially if word were to get out that BBRY was shutting the hardware side. Who would then buy the phone or develop for the OS?
    08-27-13 07:41 AM

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