Beleaguered smartphone maker BlackBerry just won’t give up the fight. The firm sold a meager 1.1 million devices in the last quarter but it's still battling for market share and it's betting on its newfound alliance with Cisco to help.
BlackBerry's total revenue for the first fiscal quarter of 2016 hit $658 million. That breaks down to 40 percent for hardware; 38 percent for services; and 21 percent for software and technology licensing. In response to this news, BlackBerry's stock slid 3 percent in midday trading. Nevertheless, BlackBerry executive chairman and CEO John Chen is putting on his best public face.
“I am pleased with the strong performance of our software and technology business,” Chen said. “This is key to BlackBerry’s future growth. Our financials reflect increased investments to sales and customer support for our software business. In addition, we are taking steps to make the handset business profitable. We believe these actions are prudent and necessary to grow the business and we believe the remaining milestones in our strategic plan are achievable.”
BlackBerry-Cisco Patent Deal
In another effort to drive revenues, BlackBerry just entered into a long-term patent cross-licensing agreement with Cisco. The agreement covers their respective products and technologies. BlackBerry will receive a license fee from Cisco, but specific terms of the deal were not disclosed.
“With the agreement in place, BlackBerry and Cisco can focus on innovation and continued technical cooperation, allowing our companies more freedom to create leading products and services for customers without the potential for patent disputes,” said Mark Kokes, Vice President of Intellectual Property and Licensing, BlackBerry. There was no specific mention of what products and services might stem from this agreement.
Losing Its Grip?
Chen didn’t get specific about what other mind-blowing steps he would take to turnaround BlackBerry’s long-ailing handset business. The earnings report did mention joint development manufacturing agreements with Wistron Corp. and Compal Electronics that aim to reduce the time to market of new devices, streamline the supply chain, leverage greater economies of scale and drive efficiencies. That hardly seems to be the answer to BlackBerry’s problems.
BlackBerry needs to move quickly. It’s market share has literally dwindled to next to nothing. BlackBerry devices accounted for a mere .3 percent of all smartphone sales in the first quarter of 2015, according to IDC. By way of comparison, Android had 78 percent of the market, Apple’s iOS had 18.3 percent of the market and Windows Phone had 2.7 percent of the market.
"Many of the same drivers were in play for Android and iOS to tighten their grip on the market," said Ramon Llamas, Research Manager with IDC's Mobile Phone team. "A combination of strong end-user demand, refreshed product portfolios, and the availability of low-cost devices -- particularly for Android -- drove volumes higher."
Posted: 2015-06-23 @ 2:00pm PT
I use a BlackBerry Passport and will continue to use BlackBerry as long as I feel it makes the best phones on the market. The company's OS is the best out there and the battery lasts forever on this phone. (I'm currently typing this comment with it).
Some things like videos end up with a reduced screen and there are definitely fewer apps. But I use a smartphone as a mobile computer for work and nothing is better than the Passport for that purpose. I can access my desktop files from anywhere. It takes great pictures and is great for reading and responding to e-mails. I, for one, hope they never stop making phones.