[Dunt Dunt Dunt]

Maybe they need to rethink their expectations.
This is basically free money. Another company making and selling a product and giving them a cut. If they have an option between the amount they want and zero, it would seem like there's a middle ground that should be acceptable.

See conite's post above yours... this isn't just free money.

BlackBerry has a cost to provide services in association with this licensing deal.

[Bbnivende]

See conite's post above yours... this isn't just free money.

BlackBerry has a cost to provide services in association with this licensing deal.

But we don’t know this to be true. Do we? It could be the whole of the fees which are the problem and we have a fair idea that the whole of the fees are high margin income for BlackBerry.

[hoopitz]

Well, without those numbers, I suppose the rest is just idle chat. At the end of the day, we either believe BlackBerry is working in the best interest of its shareholders with respect of this agreement, or they aren't.

Right. What I'm proposing is, they aren't ... and then inviting some healthy debate on the matter haha

[hoopitz]

...This licensing was just an attempt to get some cash in the short term while those other things ramp up. That’s all this is. If it’s not generating enough cash to be worth it, BB will just move on. There is no business reason to bend over on this.

I'm not so sure that's the case. TCL was committed to a "long-term strategic investment" with BlackBerry - I can't imagine that was only supposed to be 2 years. So either you're right, and BlackBerry was just trying to squeeze any penny they could, unbeknownst to TCL, or something just went really wrong.

[conite]

But we don’t know this to be true. Do we? It could be the whole of the fees which are the problem and we have a fair idea that the whole of the fees are high margin income for BlackBerry.

Perhaps they would have more to gain by letting the talks break down and collect the amount owing in court rather than agreeing to some nominal fee structure going forward.

It's just a math problem.

[conite]

I'm not so sure that's the case. TCL was committed to a "long-term strategic investment" with BlackBerry - I can't imagine that was only supposed to be 2 years. So either your right, and BlackBerry was just trying to squeeze any penny they could, unbeknownst to TCL, or something just went really wrong.

What else are they going to say when customers depend on supplier stability - "we're going to try this for a bit and see what happens" ?

It was a 5 year deal - so there are still over 2 years left. But that doesn't mean they have to keep producing at a loss.

[Chuck Finley69]

Right. What I'm proposing is, they aren't ... and then inviting some healthy debate on the matter haha

Six years of consistent management that included exiting mobile at the halfway point suggests the only concern has been shareholders as the few large ones are controlling the company management. Since the PE and the AM companies are involved, when there’s money laying to be picked up, it happens. The simple equation is that BB computed a fixed base cost it expected to be paid whether or not BBMo successfully hit sales targets. BBMo would have spread that cost over projected sales and fell way short. BB doesn’t care about BBMo problems. TCL has plenty of money but feels BB can’t force collection. The mobile industry wants to see how this ends. BB has nothing to lose compared with TCL and it’s future reputation.

[Dunt Dunt Dunt]

But we don’t know this to be true. Do we? It could be the whole of the fees which are the problem and we have a fair idea that the whole of the fees are high margin income for BlackBerry.

We don't know the numbers...

I just think if it could be done profitable, Chen would have adjusted things last year to make it work. In the end the price really wasn't the factor that kept Carriers, Enterprise and Consumers away....

[idssteve]

BB's reputation SHOULD concern them... even if they're just planning to sell lemonade. Lol. Potential customers might just calculate past experiences into selecting new products. Might be small issue but non-zero...

[conite]

BB's reputation SHOULD concern them... even if they're just planning to sell lemonade. Lol. Potential customers might just calculate past experiences into selecting new products. Might be small issue but non-zero...

Well, clearly they've calculated it at something less than what they are owed by TCL.

[idssteve]

Well, clearly they've calculated it at somewhat less than what they are owed by TCL.

Their calculation to make. Customers' calculation to make also.

[Bbnivende]

We don't know the numbers...

I just think if it could be done profitable, Chen would have adjusted things last year to make it work. In the end the price really wasn't the factor that kept Carriers, Enterprise and Consumers away....

That is true. The LE was priced ok not horrible.

Perhaps TCL was just making enough Key devices to satisfy its commitment’s after they made the decision to go with the TCL brand. The Plex has been in development for some time.

TCL wants volume . Not a niche handset maker.

Both BlackBerry and TCL needed an all touch phone because the PKB market is just too small. Android Profit margins are too shallow to pay for hardening, the brand and a “OS”.

[hoopitz]

What else are they going to say when customers depend on supplier stability - "we're going to try this for a bit and see what happens" ?

It was a 5 year deal - so there are still over 2 years left. But that doesn't mean they have to keep producing at a loss.

You seem to be missing my original point, though. We can agree that TCL (most likely) isn't making any money from this deal, or at least not as much as they need to be for it to continue, yeah? And we can also agree that whatever royalty payments BlackBerry is collecting need to be enough to make it worth it on their end? These are very obvious statements.

Since we have NO idea what any of these numbers look like, we're all just speculating. I say that I think BlackBerry got the better of the deal, and TCL is just realizing that now. BlackBerry very well might just let everything fall apart, collect whatever money is owed and then be finished with handsets altogether. I'm also saying that I hope they can work something out and maybe renegotiate terms that are profitable for both of them.

All of this is of course assuming BlackBerry even cares about still having hardware, which John Chen has repeatedly said he does. But again, maybe it just doesn't make sense for them anymore - they tried this strategy, and it didn't seem to go very well.

[conite]

You seem to be missing my original point, though. We can agree that TCL (most likely) isn't making any money from this deal, or at least not as much as they need to be for it to continue, yeah? And we can also agree that whatever royalty payments BlackBerry is collecting need to be enough to make it worth it on their end? These are very obvious statements.

Since we have NO idea what any of these numbers look like, we're all just speculating. I say that I think BlackBerry got the better of the deal, and TCL is just realizing that now. BlackBerry very well might just let everything fall apart, collect whatever money is owed and then be finished with handsets altogether. I'm also saying that I hope they can work something out and maybe renegotiate terms that are profitable for both of them.

All of this is of course assuming BlackBerry even cares about still having hardware, which John Chen has repeatedly said he does. But again, maybe it just doesn't make sense for them anymore - they tried this strategy, and it didn't seem to go very well.

BlackBerry got out of the hardware game for a reason. Licencing unloads all sales and inventory risk to said licencee(s) - so no doubt TCL would bare the brunt of the hardship.

But BlackBerry has to decide if making a "better" deal for TCL going forward is more advantageous for BlackBerry than just seeing TCL in court to force them to honour the existing agreement and pay up.

[Bbnivende]

BlackBerry got out of the hardware game for a reason. Licencing unloads all sales and inventory risk to said licencee(s) - so no doubt TCL would bare the brunt of the hardship.

But BlackBerry has to decide if making a "better" deal for TCL going forward is more advantageous for BlackBerry than just seeing TCL in court to force them to honour the existing agreement and pay up.

All good points but it is possible that TCL just does not see enough sales potential there, even with a better deal. TCL is all about the screen now and a PKB phone is kind of a stand alone.

Perhaps TCL is just waiting out the trade war. The USA was their intended major market and maybe they are waiting for better days?

[Troy Tiscareno]

TCL is just waiting out the trade war. The USA was their intended major market and maybe they are waiting for better days?

The elephant in the room is this:



Even if you ignore the fact that the volume of sales can't be sustainable given all of TCL's costs, the trend line alone is enough to run away. Hell, I thought TCL and the other licensees were crazy to sign up in the first place (purely from a business point of view, as this trend extends back further than 2013), but obviously TCL believed they could turn things around. It turns out, they didn't, and things have only gotten worse, with 2018 sales being half of 2017 sales, and 2019 bound to be even less due to lack of inventory (I expect BBMo to sell 100k devices in 2019). BB was planning to sell several million phones a year, and that's what their business model was based on. Their overhead costs to sell and support this phone around the world have to be enormous, and this level of sales wouldn't begin to pay for it.

It would be like paying for a McDonald's franchise and building a new building, and only being able to sell a few dozen burgers a day. You'd go bankrupt pretty quickly.

[Bbnivende]

The elephant in the room is this:

[IMG=911x564]https://i.imgur.com/5TqfXur.jpg[/url]

Even if you ignore the fact that the volume of sales can't be sustainable given all of TCL's costs, the trend line alone is enough to run away. Hell, I thought TCL and the other licensees were crazy to sign up in the first place (purely from a business point of view, as this trend extends back further than 2013), but obviously TCL believed they could turn things around. It turns out, they didn't, and things have only gotten worse, with 2018 sales being half of 2017 sales, and 2019 bound to be even less due to lack of inventory (I expect BBMo to sell 100k devices in 2019). BB was planning to sell several million phones a year, and that's what their business model was based on. Their overhead costs to sell and support this phone around the world have to be enormous, and this level of sales wouldn't begin to pay for it.

It would be like paying for a McDonald's franchise and building a new building, and only being able to sell a few dozen burgers a day. You'd go bankrupt pretty quickly.

The thing is that BlackBerry left the handset market because they were losing money . How can both TCL and BlackBerry make a profit now ?BlackBerry said that TCL had their own data not theirs.

House of Brands is not a great strategy outside selling to Walmart.

Finally , TCL seems to be trying for cheap and good. Maybe, but they need to get their quality up so that there are fewer returns.

[FortressBB10]

I really wonder how a phone like the Titan would do if made slender and looked something like the Passport SE.

I get the sense that doing deals with either Chen or a Chinese company would not be fun.

[Sigewif]

Ring! Ring!
Ahoy! (or was that Hoy,hoy!)..? (no not Hello)

Well the tussle over the credit for the invention of the Telephone has been disputed from the beginning between the Canucks and the Yanks (no not hockey and baseball)...though basketball is a Canadian invention - and finally a Canadian team won the NBA championship this past year (Go Raptors!).....well okay with 90% American Players....but I digress...
While Alexander Graham Bell was Canadian, he did work for AT&T so the link between the two countries in telephony is just that old!

So there has always been a Canadian Telephone, Northern Telecom, then for a while there was the fancy Nortel multiline multifunction business/home phone.....and then there was the BlackBerry.
BlackBerry HQ is less than 40km away from where the first telephone call in the World ever occured. (Brantford to Paris Ontario Canada).

Obviously the telephone is as Canadian as Hockey and so BlackBerry must as a matter of national identity remain in the Smartphone marketplace. Two things the railroad and telephony helped forged Canada..more than almost any other country.....besides BB10 is just a really really good phone....and while BBAndroid is a compromise it is something....until something better comes along.
That's not to say it should play it badly and bleed unnecessarily, but sometimes its necessary - though this particular situation doesn't appear to need a bloodletting.


Maybe the next model in Canada at least should be called the "Alexandar Graham Bell" edition, or a maybe a special bb10 re-issue. Somebody running/owning BlackBerry ought to know this pedigree. You were passed the torch, don't snuff it out.

Wow, thanks for the Canadian history lesson. I didn't know this story. I have a direct ancestor who came to Ontario in the 1840s and lived there during that era. I love how you tied this story together.

[Sigewif]

Leverage the brand to what end? For what? For where?

BlackBerry's main lines of business don't need it. Cylance, UEM, and QNX-auto already have all the brand recognition they need - they are at or near the top in all 3.

Brand recognition isn't really that widespread yet in the automotive field. Also, when it comes to virus protection who knows about Cylance, even among tech people, or that it is now a BlackBerry product? Not that many. I know about Cylance because I closely follow BlackBerry. How many people driving new vehicles know they have BlackBerry technology in them? But handsets? Yes there is still brand recognition there.

[Chuck Finley69]

Brand recognition isn't really that widespread yet in the automotive field. Also, when it comes to virus protection who knows about Cylance, even among tech people, or that it is now a BlackBerry product? Not that many. I know about Cylance because I closely follow BlackBerry. How many people driving new vehicles know they have BlackBerry technology in them? But handsets? Yes there is still brand recognition there.

BlackBerry is well known through it's QNX in automotive. It’s known to OEMs partnered with BlackBerry in the space. Consumers see the OEM brand facing and not BlackBerry since that’s how relationships are set up. The consumer isn’t able to deal with BlackBerry or QNX anyway.

[Emaderton3]

Negative brand recognition.

[Dunt Dunt Dunt]

I really wonder how a phone like the Titan would do if made slender and looked something like the Passport SE.

I get the sense that doing deals with either Chen or a Chinese company would not be fun.

Might double their sales.... 6K units.

I wonder if they had done the Classic instead... But in the end how many want a start up phone that may or may not get released, may or may not work fully with your carrier, may or may not come with preinstalled malware, or may or may not be made with quality components that last, and may or may not get any updates or patches.

[Invictus0]

BlackBerry is well known through it's QNX in automotive. It’s known to OEMs partnered with BlackBerry in the space. Consumers see the OEM brand facing and not BlackBerry since that’s how relationships are set up. The consumer isn’t able to deal with BlackBerry or QNX anyway.

I think the QNX brand might be more meaningful in the automotive space than BlackBerry, considering their decades of work in the auto industry.

[app_Developer]

Brand recognition isn't really that widespread yet in the automotive field. Also, when it comes to virus protection who knows about Cylance, even among tech people, or that it is now a BlackBerry product? Not that many. I know about Cylance because I closely follow BlackBerry. How many people driving new vehicles know they have BlackBerry technology in them? But handsets? Yes there is still brand recognition there.

If you mean brand recognition among consumers, you are right. Cars companies buy components from all sorts of companies. Do people know that their taillights were made by Foxconn? Or who made the steering wheel? Or who ZF or Continental or OZ are?

But maybe consumer recognition is really not important anymore.