05-06-14 12:45 PM
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  1. lawguyman's Avatar
    Chen may or may not mean that...we don't really know and I doubt Chen really knows when he throws out numbers like 10 million smartphones and profitability. 10 million is no more credible than 1 million or 100,000 or 10,000 or 100. It's a number that has zero merit other than it is in line with BB's current sales performance of a little over 5 million per year (if you take the most recent quarter's sales performance of 1.3 million smartphones sold as a guide) and we know that those numbers are neither profitable nor sustainable.

    While your speculation on Foxconn could be true, it conflicts directly with statements from Foxconn executives.

    To wit: "Hon Hai is the largest electronic manufacturing service company in the world, said Mr. Chiu, the Foxconn executive. We are the platform for all the brand-name customers, and to have our own brand does not suit the company policy." (http://www.nytimes.com/2013/05/07/bu...ewanted=2&_r=0)

    In other words, Foxconn is hardly in a position to cut its nose to spite its face by launching its own brand to compete with its own customers the way HTC did when it decided to go it alone and launch its own branded smartphones and devices.

    If they were intent on doing as you suggest, however, they certainly could do much better in terms of a brand acquisition than Blackberry or to use Blackberry to go up against its largest customer, Apple.

    Finally, let's not forget that Lenovo attempted to purchase Blackberry and was rebuffed by the Canadian government for national security reasons. While Foxconn is not a Chinese company but rather a Taiwanese one, I would still venture to guess that any potential acquisition by Foxconn of Blackberry will be subject to the same scrutiny as Lenovo given Foxconn extensive holdings and activities in China.
    The 10 million number does mean something. If BlackBerry thinks it can realistically sell 10 million phones a year, it can study the logistics of this from manufacturing through end user and determine what its cost structure has to be in order to do this profitably. These kinds of projections are made all the time. It's like a budget.

    As for Foxconn, what is said today is true until it no longer is. I can't recall Foxconn's CEO standing shoulder to shoulder in public with Tim Cook but he has been doing that with Chen. There must be something in it for Foxconn because Foxconn seems to be assuming most of the risk, if Chen is to be believed.

    Posted via CB10
    04-29-14 12:51 PM
  2. NYC10065's Avatar
    The 10 million number does mean something. If BlackBerry thinks it can realistically sell 10 million phones a year, it can study the logistics of this from manufacturing through end user and determine what its cost structure has to be in order to do this profitably. These kinds of projections are made all the time. It's like a budget.

    As for Foxconn, what is said today is true until it no longer is. I can't recall Foxconn's CEO standing shoulder to shoulder in public with Tim Cook but he has been doing that with Chen. There must be something in it for Foxconn because Foxconn seems to be assuming most of the risk, if Chen is to be believed.

    Posted via CB10
    It would seem to me that Apple doesn't need anyone to see who their suppliers are while Blackberry apparently does. All Apple wants consumers to see is "Designed in California". It certainly doesn't want to showcase "Made in China". I think that has a greater impact on whether Terry Gou of Foxconn makes any appearances with Apple. Don't forget that media attention on Foxconn as relates to Apple has more to do with working conditions and a spate of worker suicides at Foxconn than anything else. I highly doubt Apple executives are looking to be so visibly associated with Foxconn is. Blackberry, on the other hand, has nothing to lose and Foxconn's relationship with Blackberry appears to be far more invested as opposed to "customer/supplier" which is what Apple's clearly is.

    In addition, while Foxconn is Apple's largest manufacturing partner, it isn't Apple's only supplier. In fact, Foxconn has seen its share of Apple's manufacturing reduced particularly in the past year.

    The 10 million number -- again, I'm afraid I disagree since it makes absolutely no sense. There really is no arithmetic measure which allows Blackberry to magically say that 10 million equals profit when 5.2 million equals massive losses. It just underscores how confused things are at BBRY. They are stuck in a vicious circle. Having had some experience with manufacturing in China, I can tell you that there is a material difference in component pricing and manufacturing efficiency when your production line calls for 120 million units (which is more or less what Apple produces just on two iPhone models not to mention iPads, Macbooks and other devices) versus 10 million units of a variety of products (in Blackberry's case, at least 4 different BB10 devices and several BBOS devices). Again, who knows how much they've cut Foxconn in for but from the sounds of things, Foxconn is the driver and Foxconn isn't going to allow itself to lose money just to be nice to Chen or Blackberry.

    Finally, regarding Foxconn's future plans, you could very well be correct. That is what I said in my initial response. However, there is absolutely zero corporate evidence to suggest that your speculation of Foxconn's plans are true. Again, who knows but I would be shocked if Foxconn would risk its business relationships with the likes of Apple just to align itself with Blackberry.
    Last edited by NYC10065; 04-29-14 at 06:13 PM.
    JeepBB and milo53 like this.
    04-29-14 04:26 PM
  3. lawguyman's Avatar
    It would seem to me that Apple doesn't need anyone to see who their suppliers are while Blackberry apparently does. All Apple wants consumers to see is "Designed in California". It certainly doesn't want to showcase "Made in China". I think that has a greater impact on whether Terry Gou of Foxconn makes any appearances with Apple. Don't forget that media attention on Foxconn as relates to Apple has more to do with working conditions and a spate of worker suicides at Foxconn than anything else. I highly doubt Apple executives are looking to be so visibly associated with Foxconn is. Blackberry, on the other hand, has nothing to lose and Foxconn's relationship with Blackberry appears to be far more invested as opposed to "customer/supplier" which is what Apple's clearly is.

    In addition, while Foxconn is Apple's largest manufacturing partner, it isn't Apple's only supplier. In fact, Foxconn has seen its share of Apple's manufacturing reduced particularly in the past year.

    Finally, the 10 million number -- again, I'm afraid I disagree since it makes absolutely no sense. There really is no arithmetic measure which allows Blackberry to magically say that 10 million equals profit when 5.2 million equals massive losses. It just underscores how confused things are at BBRY. They are stuck in a vicious circle. Having had some experience with manufacturing in China, I can tell you that there is a material difference in component pricing and manufacturing efficiency when your production line calls for 120 million units (which is more or less what Apple produces just on two iPhone models not to mention iPads, Macbooks and other devices) versus 10 million units of a variety of products (in Blackberry's case, at least 4 different BB10 devices and several BBOS devices). Again, who knows how much they've cut Foxconn in for but from the sounds of things, Foxconn is the driver and Foxconn isn't going to allow itself to lose money just to be nice to Chen or Blackberry.

    Finally, regarding Foxconn's future plans, you could very well be correct. That is what I said in my initial response. However, there is absolutely zero corporate evidence to suggest that your speculation of Foxconn's plans are true. Again, who knows but I would be shocked if Foxconn would risk its business relationships with the likes of Apple just to align itself with Blackberry.
    Look at the math this way. Say it costs you $5 just to keep the doors of your business open by paying you employees and rent and other routine business expenses. Say you think you can sell 10 widgets a year and they are going to cost you $5 to build and bring to market . With that information, you would know that you should charge something like $1.20 per widget in order to make a nice profit. Maybe if you got rid of some overhead or employees, you could cut the price a little. Maybe you hunt for a good deal on some components. You could shave a bit off. This is how BlackBerry is using the 10 million number. Whether it can succeed is another story. Niche products are typically more expensive than mass produced products.


    On Foxconn, you are right that Apple wants the stage to itself. I still am not clear what is in it for Foxconn since it is said to be taking on the inventory risks. Between Playbook and BB10 phones, BlackBerry wrote down several billion in inventory. Why would Foxconn agree to take that on? Where is the upside? Chen said that BlackBerry did not give up much.





    Posted via CB10
    04-29-14 05:57 PM
  4. NYC10065's Avatar
    Look at the math this way. Say it costs you $5 just to keep the doors of your business open by paying you employees and rent and other routine business expenses. Say you think you can sell 10 widgets a year and they are going to cost you $5 to build and bring to market . With that information, you would know that you should charge something like $1.20 per widget in order to make a nice profit. Maybe if you got rid of some overhead or employees, you could cut the price a little. Maybe you hunt for a good deal on some components. You could shave a bit off. This is how BlackBerry is using the 10 million number. Whether it can succeed is another story. Niche products are typically more expensive than mass produced products.


    On Foxconn, you are right that Apple wants the stage to itself. I still am not clear what is in it for Foxconn since it is said to be taking on the inventory risks. Between Playbook and BB10 phones, BlackBerry wrote down several billion in inventory. Why would Foxconn agree to take that on? Where is the upside? Chen said that BlackBerry did not give up much.





    Posted via CB10
    Look, I take your well-reasoned and well-articulated points and am not disputing them simply to be argumentative so please forgive me for insisting on these points, if I may.

    I think your widget analogy is an excellent one but it doesn't take into account one small fact: the so-called niche products that BBRY is seeking to market and sell do not in any way command a pricing premium. BB devices are not like some ultra-luxury car or clothing brand that is producing a small inventory of their products and commanding a higher premium partly because of exclusivity and scarcity of inventory. BB devices compete not just with high end, flagship devices from the likes of Apple, Samsung, LG, HTC and others but also with the low end, entry-level devices. That is the part to me that just doesn't add up. It would be amazing if Chen and BBRY were able to produce some high end niche device that is so well regarded and so highly prized that it can command a price premium. Sadly, given the major deficiencies in both the BB hardware and OS and the glacial speed at which BBRY responds to market dynamics, I just don't see it.

    Apple's gross margins are a little above 39% which is pretty impressive. That is the result of incredible negotiating power with suppliers/manufacturers due to:
    a) the popularity of Apple's various products
    b) the huge volumes which Apple can drive through production facilities
    c) the tremendous competition among manufacturers for a piece of Apple's business

    Contrast that to Blackberry:
    a) single manufacturer (Foxconn)
    b) miniscule volumes
    c) single product line yet multiple models (ie. lack of economies of scale)
    d) poor product demand

    You can't honestly think that Blackberry is able to take advantage of the huge volumes driven by Apple's manufacturing agreement with Foxconn to get access to lower priced components and production lines, do you? If that were the case, Apple would drop Foxconn in a heartbeat. Foxconn wouldn't risk its multi-billion dollar business with Apple for the sake of 10 million BB devices. Foxconn may want to diversify but it also doesn't want to commit suicide.

    Anyway, thanks for the stimulating discussion.
    Last edited by NYC10065; 04-29-14 at 07:15 PM.
    04-29-14 06:12 PM
  5. anon1727506's Avatar
    Look at the math this way. Say it costs you $5 just to keep the doors of your business open by paying you employees and rent and other routine business expenses. Say you think you can sell 10 widgets a year and they are going to cost you $5 to build and bring to market . With that information, you would know that you should charge something like $1.20 per widget in order to make a nice profit. Maybe if you got rid of some overhead or employees, you could cut the price a little. Maybe you hunt for a good deal on some components. You could shave a bit off. This is how BlackBerry is using the 10 million number. Whether it can succeed is another story. Niche products are typically more expensive than mass produced products.


    On Foxconn, you are right that Apple wants the stage to itself. I still am not clear what is in it for Foxconn since it is said to be taking on the inventory risks. Between Playbook and BB10 phones, BlackBerry wrote down several billion in inventory. Why would Foxconn agree to take that on? Where is the upside? Chen said that BlackBerry did not give up much.





    Posted via CB10
    We aren't talking widgets or simple... BlackBerry Doesn't even know their costs right know, because they don't know what it might take to market these devices to get to that 10 million in sales. What kind of promoting or maybe even price cuts will they have to do? Never mind the profits on the Z3 are minuscule in comparison to devices being sold for $600.... added to the Z10 which is still taught to be a negative for each unit.

    Posted via CB10
    04-29-14 06:12 PM
  6. JAS0NB0URNE's Avatar
    Sales probably has very little to no chance of increased sales shares until the next phones drop.

    Posted with my BlackBerry Q10.
    04-29-14 10:30 PM
  7. kevinnugent's Avatar
    Looks like BlackBerry went up 0.5 from 0.5 to 1 percent in Australia. I hope that is not a typo.
    One percent of very little is very very very little.
    04-30-14 04:11 AM
  8. JeepBB's Avatar
    One percent of very little is very very very little.
    Yeah, I recall you saying a while back that the Oz market is small.
    So, I'd assumed that the 0.5% increase was due to you buying another BB phone. ๐Ÿ˜‹



    JBB
    04-30-14 04:25 AM
  9. lawguyman's Avatar
    We aren't talking widgets or simple... BlackBerry Doesn't even know their costs right know, because they don't know what it might take to market these devices to get to that 10 million in sales. What kind of promoting or maybe even price cuts will they have to do? Never mind the profits on the Z3 are minuscule in comparison to devices being sold for $600.... added to the Z10 which is still taught to be a negative for each unit.

    Posted via CB10
    The idea is to stabilize the devices business and then hopefully to grow it again. MBA-types are trained to do market research to evaluate demand, fixed and variable costs, and other relevant things. In the past, BlackBerry has done a very poor job with this but the 10 million figure seems realistic.

    One other thing with Foxconn is that Foxconn is acting as an ODM for Jakarta. This means that Foxconn designed the phone. Foxconn does ODM work for other companies too. My guess is that Jakarta has the same internals as other Foxconn ODM phones, but probably with more RAM. If you look at it this way, you can see that this is another way in which unit costs can be kept down.

    There are many ODM Consumer Electronic products out there. They have identical guts but the branding and cases are different. I bet that if you looked hard enough you could find the other Foxconn phones that share the Jakarta internals.

    Posted via CB10
    04-30-14 06:57 AM
  10. anon1727506's Avatar
    The idea is to stabilize the devices business and then hopefully to grow it again. MBA-types are trained to do market research to evaluate demand, fixed and variable costs, and other relevant things. In the past, BlackBerry has done a very poor job with this but the 10 million figure seems realistic.

    One other thing with Foxconn is that Foxconn is acting as an ODM for Jakarta. This means that Foxconn designed the phone. Foxconn does ODM work for other companies too. My guess is that Jakarta has the same internals as other Foxconn ODM phones, but probably with more RAM. If you look at it this way, you can see that this is another way in which unit costs can be kept down.

    There are many ODM Consumer Electronic products out there. They have identical guts but the branding and cases are different. I bet that if you looked hard enough you could find the other Foxconn phones that share the Jakarta internals.

    Posted via CB10
    Poor Job??? How about a bunch of guys sitting around and patting each other on the back about how good a job they are doing and that they are the only ones giving customers what then need and not what they want and how one day those customers will appreciate all they have done.

    As for 10 Million figure seeming realistic.... especially compared to Android does it every 5 days, and it only takes Apple about 20 Days to sell that many. But when you look at how many BB10 devices sold last year, and the amount of marketing that BlackBerry did then and is doing now and the way the BRAND is being viewed. Selling 6 Million again this year seems like a stretch.
    JeepBB and NYC10065 like this.
    04-30-14 07:39 AM
  11. rennardd's Avatar
    So they have had negative sales?
    The last column is the percentage change between the two periods.

    Posted via CB10
    04-30-14 08:26 AM
  12. Tatwi's Avatar
    Very sad for BlackBerry.
    Indeed. I am showing my support by using my Z10 again. I love the 9900 chassis, but BB10 OS I'd great too... I'll be buying a Classic / Q20 when they are released. Here's hoping they don't screw it up - if it I'd basically a traditional Bold it will sell, too far removed (like the Q10) and it won't.

    Posted via CB10 on my BlackBerry Z10!
    04-30-14 02:15 PM
  13. AWDragon200's Avatar
    These stats exclude emerging markets like SE Asia, Africa and latin America. Blackberry is much stronger in emerging markets.

    Posted via CB10
    04-30-14 02:42 PM
  14. NYC10065's Avatar
    These stats exclude emerging markets like SE Asia, Africa and latin America. Blackberry is much stronger in emerging markets.

    Posted via CB10
    That's a total myth. Even in places like Indonesia, Blackberry has been seeing serious competition from low end Chinese Android devices.
    Last edited by NYC10065; 04-30-14 at 09:49 PM.
    JeepBB and Poirots Progeny like this.
    04-30-14 09:37 PM
  15. imcrackedout's Avatar
    Very sad for BlackBerry.

    Yes, sad and dismal. When a die hard bb user like myself looks at the S5 and ponders....... its scary.. This is as I sit here waiting for my beloved q10 to get repaired ( for the third time ) typing on the z10 loaner, it is so so, but makes me crave the upcoming q20 for some reason, I will wait for that launch as my last try. fingers crosseeeeed
    04-30-14 10:17 PM
  16. frielfanatic's Avatar
    I honestly don't see where the handset division has to go. Chen mentions a focus on enterprise, yet every major company I work with has either transitioned from or is beginning to phase blackberry. A huge reason is companies began developing critical business apps and once deployed it makes no sense to switch back. I believe that emerging markets is there only chance, because they are done in the us. When competitors are spending a quarter of bbry's worth on advertising, they don't have a prayer. I still am yet to see a bb10 device outside of my own, and honestly if I was the average consumer outside of crackberry, I wouldn't take the time to learn workarounds to make the device functional.

    Posted via CB10
    04-30-14 11:42 PM
  17. kbz1960's Avatar
    The last column is the percentage change between the two periods.

    Posted via CB10
    I guess I needed a smiley to show I was being dumb
    JeepBB likes this.
    05-01-14 06:32 AM
  18. JeepBB's Avatar
    I tend to use smilees a lot, even in semi-official emails... Much as that may not be very professional. ๐Ÿ˜Š Sometimes the text alone, particularly when some of the folk that I email don't have English as their first language, can be misunderstood.
    I've seen enough flame wars on CB sparked by what was clearly a misreading of the OP's "intent" and a too-literal interpretation of the words.
    So, even if I think my words are incapable of misinterpretation... I often add a smilee... ๐Ÿ˜‹

    JBB
    kbz1960 likes this.
    05-01-14 07:41 AM
  19. BeautyEh's Avatar
    "Other" also got slammed in this chart, so BB can't feel too bad.
    There are days when I feel like - f*#k it, I would much prefer to be the lone person in a room with a unique device, when everyone else has either iPhone or Galaxy. They can enjoy them.

    Posted via CB10
    05-02-14 03:20 AM
  20. matador22's Avatar
    Whoa those numbers are humbling to say the least. I will stick with BlackBerry till they stop making phones. I feel a lot of people on this site will also. Just think of Saab motor company. There are people who bought the last ever manufactured saabs a few years ago and are proudly driving them and getting parts/service from local shops. BlackBerry handsets will soon be collector's items. Ha. Can't wait for the Q20/bb classic!

    Posted via CB10
    05-02-14 11:21 AM
  21. BB_Junky's Avatar
    That's to bad, distancing themselves from the consumer is only going to hurt them even more I'm afraid. The Prosumer isn't buying new devices they like the Stone Age and rereleasing old devices isn't going to attract any new people , just going to make the few who want it happy.
    I look for stuff in stores and in our walmart the display is empty , Best Buy had nothing, Future shop has a Z30 and a keyboard thing ... But they haven't been touched in months due to the dust build up on each.
    This sucks huge as I really wanted them to succeed, but I guess time will tell!... Good luck BBRY!!


    Sent from my iPhone using Tapatalk
    05-06-14 12:45 PM
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