Five Tips for Overcoming Mobile Security Challenges
BlackBerry, which remains the only business-focused smartphone supplier, released its financial results today, and they reflect strong improvement on most vectors. Recently, Nokia announced that its new dual-SIM phone for emerging markets had embraced BBM, and BlackBerry announced yesterday that it was adopting the Amazon App store, providing an opportunity to be the business component of Amazon’s Fire phone effort (this could be anything from device to messaging and management services).
Let’s talk about the BlackBerry turnaround today.
Mechanics of a Turnaround
One of the most important phases of any turnaround effort is getting key players to believe that the turnaround is possible. If investors, customers and/or employees don’t believe in the possibility of a turnaround, their belief generally becomes a self-fulfilling prophesy. Key to this belief is financial performance. Steve Jobs, for example, got this done largely by getting a large loan from Bill Gates, but it was a number of years later before the financials actually reflected that the Apple turnaround was succeeding.
For BlackBerry, the first sign that things were getting better was when it announced it was going private last year. Much like Gates’ investment in Apple, this showcased that the firm had value, and that value was confirmed by this quarter’s positive results. The strategy appears to be working, and working rather well, as the company surprised analysts with far more positive results than expected. It has increased investments by $400 million, increased gross margin by 5 points to 48 percent, dropped expenses by a whopping 57 percent, and dramatically reduced net loss, showcasing a trend that should return it to profitability shortly.
Initiatives to Watch
Several key initiatives have launched in support of this turnaround effort. Project Ion is perhaps the most interesting because it positions QNX as a preferred platform for the emerging Internet of Things (IoT) market. QNX, which was an acquisition, is already used widely in business for connected systems, particularly in secure environments. Given the alerts that have been going out as a result of hackers taking over digital signage recently (the Godzilla attack on digital signage is both funny and frightening), focusing on IoT efforts having a secure platform should provide the company with a strategic advantage.
The EZ Pass Program to move BlackBerry’s device management offerings more aggressively into enterprises has already shown solid signs of success. BlackBerry reports 1.2 million licenses, 10 percent of which were competitive migrations.
One of the most interesting moves was this week when BlackBerry announced it was going to embrace the Amazon App store. This store gives BlackBerry phones a much stronger app portfolio; Amazon has the majority of high-profile apps from the Android App store and curates more aggressively so the store should be far safer. This also opens the door to a potential tighter relationship with Amazon and Amazon Web Services, which could embrace BlackBerry as the preferred business platform solution. (Amazon’s recent Fire phone, like the Kindle effort, is focused like a laser on consumers).
BBM was embraced by Nokia’s latest emerging market phone and it is expected to be on Windows phones shortly, providing the one cross-platform secure solution for business messaging increasingly important for this BYOD market.
Wrapping Up: BlackBerry Continues to Improve
Given the amount of noise coming from the consumer market, we often forget BlackBerry, which has been improving in the background. It has shifted from a device-centric model to one more solidly supported by software and services, and that strategy appears to be at the core of turnaround efforts. Financial performance is sharply improved, and this improvement is founded in expansion of BBM and especially the EZ Pass efforts, which have increased BlackBerry’s relevance. Looking ahead, the possibility of a deeper relationship with Amazon and the uniquely solid position with QNX against the requirement that IoT efforts be secure provides a solid foundation for increased growth.
In the end, as we enter the second half of 2014, BlackBerry appears in far better shape than it has for some time. While it isn’t out of the woods yet, it now appears far more certain that it will get there.
