I'm just curious because I'm not to sure, I'm not asking about the number of handsets being sold or anything but BlackBerry used to make money off of each handset a month how? Why can't they do the same thing with bb10?
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I'm just curious because I'm not to sure, I'm not asking about the number of handsets being sold or anything but BlackBerry used to make money off of each handset a month how? Why can't they do the same thing with bb10?
Posted via CB10
BIS.
Carriers had to pay a fee for BIS usage. At it's peak, it made BlackBerry some mad cash.
That is a pretty bare bones asnwer though, so I'll edit it up if someone doesn't comein and explain it better before then.
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1. BBOS devices sold way more
2. SAF (Service Access Fees) : BBOS users had to pay Monthly to use BlackBerry services which got discontinued with BB10
Z30STA100-2/10.3.2.2639
Many more BES subscriptions too. Companies big and small paid for BES to run on top of their email servers. My work was one of them.
But, once the iPhone added native Exchange Activesync, our office dumped BES as fast as they could. And I know many other small companies did too to reduce expenses just as the economic crisis was hitting.
BES is still a thing, of course, but the number of companies using it today are much less than it used to be. It's probably the only thing they are still making money on. It just isn't to the levels they need to make up for losses elsewhere.
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Nit exactly true, I never had to pay BIS fee, they were included in the contract monthly fee which was exactly the same as on other platforms, so the carrier was paying the BIS fee.
that's not to say the carrier was loosing money, the carrier never looses money on their way ovrrpriced contracts.
BES and BIS are their cash cow. BB sales are two fold - they sell you the device and you subscribe the software (BES or BIS) to manage and run BB's properly. If you are a carrier that means that you pay (usually monthly) BB to license BIS and if you are an enterprise - you pay a monthly license fee for BES. And the fees are not small - I remember a monthly fee for BES for a small business (10-15 employees) is something around $10,000 per month ( I could be wrong).
In a way handset development and RR were secondary since as long as people buy any bb (pearls, curves...etc) - carriers and companies have to pay the BIS/BES fees. But when people stopped buying BBs altogether and companies started to cut - costs BIS and BES income started to dry up for BB. They are forced to depend on income from handset sales alone. And that doomed their business model.
BlackBerry has always made the bulk of its money on service fees. Originally, it was BES which tied into corporate mail servers and allowed executives and other highly mobile staff access to email from anywhere. As technology improved, the email only handsets had the phone features added. The core offering of BlackBerry was email and internal corporate resources on the go, handsets were just a way to get users onto BES since along with the service you also needed a CAL (client access license) for each device on BES.
Once BlackBerry developed a following and became a status symbol, they developed a consumer grade connection, BIS. While BES essentially made a mobile device part of a company's internal network no matter where it was, all BIS did was allow a handset to use the BlackBerry network. The management and security policies allowed by BES weren't included. Instead of companies paying for an onsite server and the infrastructure, carriers paid for BIS. Some passed the cost onto their customers, and some absorbed it.
As BlackBerry sold fewer devices, a one time charge, there was a corresponding drop in both CAL's for BES access and smaller BIS fees from carriers. As carriers also moved towards LTE faster than BlackBerry imagined, BIS became more of a liability since it worked to funnel a larger and larger data pipe down to a child's straw. The recurring BIS fees hurt BlackBerry a great deal and were the primary cause of their stock drop.
One of the reasons for the focus on software and services under Chen has been to recover more of the recurring fees that fed the company's past success. Handsets have never been the core of BlackBerry, they were just the tangible piece of the network service fees.
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Yeah, most U.S. and Canadian carriers never passed on that BIS fee. AT&T didn't for me. A "BlackBerry Data Plan" with BIS cost the same as any other smartphone data plan. I don't know if every North American carrier held back on the fee. But most of the rest of the world certainly did pay.
BES, however, was always an additional cost. Whether buying it yourself on your plan or company paid.
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1.) They marketed and advertised. People actually knew they existed.
2.) People actually wanted and as such purchased BBOS devices.
3.) BIS/BES as mentioned, a little something extra.
4.) Corporate contracts. Long before the BYOD Era began its' reign, there was BlackBerry in the hands of almost every Government, Corporate and Elitist figurehead in the world.
5.) They took hits out on people who got in their way...
(The last one is just speculation... But I still believe it to be a feasible explanation so I listed it.)
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This is why some consider that BlackBerry has always really been a software company.
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How come BlackBerry just can't bring a newer version of BIS back, for bb10 to get monthly income for the cellphones? All I remember from my bbos was unlimited social networking (for BBM, email, etc) I'm assuming it was because of BlackBerry's own network, because that alone would bring more people over to BlackBerry. Also thank you everyone for informing me! :)
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Because with such a low market share, the cell phone companies will never agree to start paying this again. There is no demand. They hated paying for it in the first place.
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The question is who would pay for BIS now? Carriers have no reason to pay for it themselves, and end users certainly wouldn't pay extra for it on top of their other plan cost. People have multiple choices of social media networks now which are all included in their internet plan.
One option would be to go directly to end users and compete with Projecr Fi. That's tough, though, because BB would be doing that at a much smaller scale and without the leverage which Google has.
Who? Many carriers not only still support BIS but actively sell new contracts for it, like Vodafone UK for example.
Yeah, that's overstating it a good bit. They had various versions of BES, including one that integrated specifically for small businesses, that were actually free. If I recall correctly, BES 5 licensing was something like $59 per device, per year.
Having said that, the money maker for RIM was BIS charges from the carriers, with BES a close second. The reduction of cash influx from these services (a natural effect of BB10) was the start of the downward spiral.
The question is how many, right?. Look at SAF revenue and where it is at this point. I don't think many carriers are selling this very hard. There is an economic disincentive.
Carriers felt ShAFted.... ;-D
� There's a Crack in the Berry right now... �
Yeah some carriers actually offered "free" BIS on certain plans, but (at least in Germany), this was not the general case. Usually you had to pay five Euro per month to gain BIS access. Some carriers had special offers with free BIS if you also bought a BlackBerry phone bundled with your contract.
The way I understood is: The carriers were actually paying BlackBerry, so BBRY made quite some money with these services. The providers of course mostly got their money back by charging their customers special fees for the BIS.