The release ‘1.0.0.1’ of our product ‘Calculus I (v1)’ has been approved by BlackBerry. It should appear in BlackBerry World for all countries within 24h. This version is free for a limited time as we build our Built for BlackBerry UI, and add quiz scoring/gaming, ‘Live Tutor'(sm), and other social elements. We’d appreciate your feedback with this beta version. Please, share with students who may be studying Calculus and preparing for exams/review.
[Update: November 12, 2013. We’re celebrating availability of the Z30 on Verizon on November 14, 2013! The “Calculus I” app can now be directly downloaded for all OS 10.0.0 devices and higher OS versions; check it out for FREE on a new Z30! Point to the following link on your device web browser: http://t.co/sor3hV5j4c]
Google may be changing how it compiles app codes into executable code. The goal is to make apps run more efficiently and to save battery life. It will be interesting to see how this impacts Oracle’s relationships with Google which uses JAVA on Android and with BlackBerry which has its own implementation with the Android player. Will ART make Android machine specific? How will ART impact BlackBerry’s Android player/run time? Let us know your thoughts in the comments section below.
Oracle has sued Google over Java-related patents and technology that appear on the Android mobile operating system:
Dalvik is the process virtual machine (VM) in Google’s Android operating system. It is the software that runs the apps on Android devices. Dalvik is thus an integral part of Android, which is typically used on mobile devices such as mobile phones and tablet computers as well as more recently on embedded devices such as smart TVs and media streamers. Programs are commonly written in Java and compiled to bytecode. They are then converted from Java Virtual Machine-compatible .class files to Dalvik-compatible .dex (Dalvik Executable) files before installation on a device. The compact Dalvik Executable format is designed to be suitable for systems that are constrained in terms of memory and processor speed.
Oracle has claimed that Dalvik Virtual Machine infringes on Java Virtual Machine patents.
It’s not clear if BlackBerry has an agreement with Oracle or uses the same patented IP from Oracle in its Android player.
[Update: November 12, 2013. We’re celebrating availability of the Z30 on Verizon on November 14, 2013! The “Calculus I” app can now be directly downloaded for FREE for all OS 10.0.0 devices (Z10, Q10,Q5, Z30) and higher OS versions; check it out for FREE on a new Z30! Point to the following link on your device web browser: http://t.co/sor3hV5j4c]
We’ve signed, sealed, packaged and delivered to BlackBerry World our Version 1.0.1 of our 1st course in college Calculus review application. It will be available for free, in this version, for a limited time, until we add the built for BlackBerry UI and some unique social aspects. In the meanwhile, we hope it helps students prepare for their exams.
[Update: November 12, 2013. We’re celebrating availability of the Z30 on Verizon on November 14, 2013! The “Calculus I” app can now be directly downloaded for all OS 10.0.0 devices and higher OS versions; check it out for FREE on a new Z30! Point to the following link on your device web browser: http://t.co/sor3hV5j4c]
John Chen was born on Canada Day, 1955. This is a good omen for Canada’s titan of
technology, BlackBerry. As Interim CEO, and perhaps the future new CEO, this Chinese speaking executive is in great stead to build new growth and partnerships for BlackBerry. What else do we know about Mr. Chen?
John Chen
Born July 1, 1955
Hong Kong
Nationality American
Alma mater Brown University
California Institute of Technology
Occupation Former CEO of Sybase, Interim CEO Blackberry Ltd
John S. Chen (born July 1, 1955) was chairman, chief executive officer and president of Sybase, an independent software vendor specializing in data management, analytics, and mobility technology until January 2013.[1] He has also been a director at BlackBerry, Wells Fargo & Company and Walt Disney Company. As of November 4, 2013, Chen is interim CEO of Blackberry Ltd.[2]
EducationEdit
A native of Hong Kong, John Chen graduated from Northfield Mount Hermon School, an elite prep school in Northfield, Massachusetts. He then went on to graduate magna cum laude from Brown University in 1978 with a BS degree in electrical engineering. In 1979 he received his MS degree in electrical engineering from the California Institute of Technology.[3]
CareerEdit
John S. Chen began his career as a design engineer with Unisys, where he eventually served as vice president and general manager of, in turn, the Convergent RISC Platform Division and the Convergent UNIX Systems Group. In 1991 he joined Pyramid Technology Corporation as executive vice president. Chen was elected president, chief operating officer and a director of Pyramid in 1993, serving until 1995.
Chen next joined Siemens Nixdorf as a vice president in 1995. He was promoted to president and chief executive officer of Siemens Nixdorf’s Open Enterprise Computing Division in 1996.
In 1997 Chen became president, chief operating officer and a director of Sybase. He was named chairman, CEO and president of Sybase in November 1998.
Chen developed and led Sybase’s re-invention strategy to evolve what had become a mature slower growth technology company into a $1B+ high-growth innovator. First, Mr. Chen returned Sybase to profitability and improved its balance sheet. He then defined and implemented Sybase’s “Unwired Enterprise” strategy to reposition the company, leveraging its database knowledge to create new offerings that addressed the emerging markets for analytics and mobility.[1]
Under Chen’s leadership, Sybase achieved strong financial performance and shareholder returns, including 55 consecutive quarters of profitability, $2.8 billion of cash generated, and a 28 percent compound annual growth rate of its market capitalization from a low of $362 million to $5.8 billion in 2010, when it was acquired by SAP AG.[4]
Board and trustee appointments
Chen will be appointed executive chairman of the board and interim CEO of BlackBerry in November 2013, responsible for the company’s strategic direction, strategic relationships and organizational goals[5]. He was elected a director of the Walt Disney Company in 2004 and of Wells Fargo & Company in 2006. He has also served on the board of the CIT Group Inc., and as a member of the New York Stock Exchange’s listing advisory committee, as well as the boards of several high-tech start-ups, including Beyond.com, Niku Corporation, Wafer Technology and Turbolinux US.
He is also a trustee Caltech [6] and the Brookings Institution, national trustee of The First Tee,[7] governor of the San Francisco Symphony,[8] past chairman (2009–2011) and longtime member of the Committee of 100[9] and a member of the Council on Foreign Relations.[3]
International relationsEdit
Mr. Chen is actively involved in international relations. He has testified before Congress on U.S.–China trade relations.[3] U.S. President George W. Bush appointed Chen to serve on the President’s Export Council in 2005.[10] In 2006, he was appointed co-chair of the Secure Borders and Open Doors Advisory Committee.[11]
Additionally, Mr. Chen chaired the U.S.-China Policy Advisory Roundtable for the Center for Strategic and International Studies (CSIS).[12]
AwardsEdit
The Brown University School of Engineering awarded Chen its BEAM (Brown Engineering Alumni Medal) Award in 2003.[13]
Chen holds an honorary professorship from Shanghai University, and honorary doctorates from San Jose State University, City University of Hong Kong, and Hong Kong University of Science and Technology.
In recognition of his leadership in building U.S.-Asia relations, Mr. Chen has received awards from the US-Asia Institute (2009), the U.S.-China Policy Foundation, and the California-Asia Business Council (2007). The U.S.-Pan Asian American Chamber of Commerce Education Foundation has recognized Chen for his corporate board work.
BlackBerry stays public, gets Fairfax and others to adopt $1 billion of its debt, as the stock loses near $1 trading at 6.88, down from $7.77 close on Friday.
One has to hand it to Prem Watsa and the board for showing faith in BlackBerry’s future potential and realizing that it was time for a sweep of the executives at BlackBerry who with the delivery of BB10, failed to gain mind share for the brand and place the product in the hands of customers. I’m looking forward to Watsa’s lead as BlackBerry continues to re-invent itself. The search for a new CEO starts soon and one expects that all top tier management, including the CMO, Frank Boulben, will be moving on soon.
John Chen is replacing Thorsten Heins as interim CEO of BlackBerry. Chen is currently a director at both Wells Fargo and Disney, and his last big management stint was as chairman and CEO of Sybase, where he is credited with transforming the company prior to selling it to SAP
Press Release
John S. Chen to be Appointed Executive Chair of BlackBerry’s Board of Directors and Interim CEO; Prem Watsa to be Appointed Lead Director
Company Concludes Review of Strategic Alternatives and Announces Changes to Board and Leadership Team
WATERLOO, ONTARIO and TORONTO, ONTARIO–(Marketwired – November 04,
2013) – BlackBerry (NASDAQ: BBRY)(TSX: BB), a world leader in the mobile communications market, today announced that it has entered into an agreement pursuant to which Fairfax Financial Holdings Limited (“Fairfax”) and other institutional investors (collectively, the “Purchasers”) will invest in BlackBerry through a U.S. $1 billion private placement of convertible debentures. Fairfax has agreed to acquire U.S. $250 million principal amount of the Debentures. The transaction is expected to be completed within the next two weeks.
Under the terms of the transaction, the Purchasers will subscribe for U.S. $1 billion aggregate principal amount of 6% unsecured subordinated convertible debentures (the “Debentures”) convertible into common shares of BlackBerry at a price of U.S. $10.00 per common share (the “Transaction”), a 28.7% premium to the closing price of BlackBerry common shares on November 1, 2013. The Debentures have a term of seven years. Based on the number of common shares currently outstanding, if all of the U.S. $1 billion of Debentures were converted, the common shares issued upon conversion would represent approximately 16% of the common shares outstanding after giving effect to the conversion.
Upon the closing of the transaction, John S. Chen will be appointed Executive Chair of BlackBerry’s Board of Directors and, in that role, will be responsible for the strategic direction, strategic relationships and organizational goals of BlackBerry. Prem Watsa, Chairman and CEO of Fairfax, will be appointed Lead Director and Chair of the Compensation, Nomination and Governance Committee and Thorsten Heins and David Kerr intend to resign from the Board at closing.
In addition, Mr. Heins will step down as Chief Executive Officer at closing and Mr. Chen will serve as Interim Chief Executive Officer pending completion of a search for a new Chief Executive Officer.
Today’s announcement marks the conclusion of the review of strategic alternatives previously announced on August 12, 2013.
“Today’s announcement represents a significant vote of confidence in BlackBerry and its future by this group of preeminent, long-term investors,” said Barbara Stymiest, Chair of BlackBerry’s Board. “The BlackBerry Board conducted a thorough review of strategic alternatives and pursued the course of action that it concluded is in the best interests of BlackBerry and its constituents, including its shareholders. This financing provides an immediate cash injection on terms favorable to BlackBerry, enhancing our substantial cash position. Some of the most important customers in the world rely on BlackBerry and we are implementing the changes necessary to strengthen the company and ensure we remain a strong and innovative partner for their needs.”
Ms. Stymiest added, “I am also pleased that John Chen, a distinguished and proven leader in the technology industry, has agreed to serve as BlackBerry’s Executive Chairman. I look forward to continuing to serve BlackBerry as a member of its Board of Directors and chair of the Board’s Audit and Risk Management Committee. On behalf of the Board, I would also like to thank Thorsten for his service to BlackBerry over the past six years. Under his leadership, BlackBerry established a more efficient cost structure, developed new products, saw the adoption of BES 10 and delivered the BlackBerry 10 platform. These are all significant accomplishments. We are grateful for his contributions and wish him well in his future endeavors.”
“Fairfax is a long-time supporter, investor and partner to BlackBerry and, with this investment, reinforces its deep commitment to the future success of this company,” said Prem Watsa, Chairman and CEO of Fairfax. “I look forward to rejoining the BlackBerry Board and to working with the other directors and management team, under John Chen’s leadership, to shape the next stage of BlackBerry’s strategy and growth.”
“I am pleased to join a company with as much potential as BlackBerry,” said Mr. Chen. “BlackBerry is an iconic brand with enormous potential – but it’s going to take time, discipline and tough decisions to reclaim our success. I look forward to leading BlackBerry in its turnaround and business model transformation for the benefit of all of its constituencies, including its customers, shareholders and employees.”
The closing of the transaction is subject to customary conditions, including approval from the Toronto Stock Exchange.
Pursuant to the Transaction agreement, the investors have an option to purchase up to an additional U.S. $250 million principal amount of Debentures within 30 days following closing. If an additional U.S. $250 million of Debentures is issued and all U.S. $1.25 billion of Debentures were converted, the common shares issued upon conversion would represent approximately 19.2% of the common shares after giving effect to the conversion, based on the number of common shares currently outstanding.
We recently wrote about the prospective partnerships with BlackBerry, and we concluded that Lenovo, Sony and Facebook would each have the most to offer and benefit from a partnership with BlackBerry:
Will Lenovo provide the icing for the BlackBerry re-serve of everything OS 10?
Here’s an interesting article from The China Daily:
BlackBerry ripe for takeover by Lenovo
Updated: 2013-11-02 07:21
By Gao Yuan (China Daily)
Lenovo Group Ltd will “actively consider” acquisitions in the mobile consumer electronics industry, said Yang Yuanqing, chairman and chief executive officer of the world’s largest personal computer maker.
Yang’s remarks came amid reports that the Chinese company is in talks with embattled BlackBerry Ltd on a merger possibly worth $4.7 billion.
“Mergers and acquisitions are always useful tools for us to expand business into new markets, and we are open to deals that can boost our business,” the CEO said on Friday.
Lenovo, headquartered in Beijing, has long been rumored to be an active bidder for BlackBerry, which has been losing ground to Apple Inc and Samsung Electronics Co Ltd in the high-end smartphone sector.
In mid-October, The Wall Street Journal reported that Lenovo signed a nondisclosure deal to examine the books of the Canadian smartphone maker, which could pave the way for a possible acquisition.
The Chinese company is borrowing roughly $1.5 billion from banks for the deal, Reuters said.
“We have to prepare enough fodder for the next move,” Yang told reporters. But he refused to confirm the BlackBerry bid.
Other potential suitors are said to include Google Inc, SAP AG and Facebook Inc.
“BlackBerry’s patents and channel partner resources are valuable assets for Lenovo,” said James Wang, a Shanghai-based analyst at research firm Canalys.
Telecom operators are the biggest smartphone sellers in developed economies, and Lenovo needs such resources if it wants to enter US and European markets, according to Wang.
Lenovo will make its way to developed markets by 2015 after it enters such emerging economies as Russia, Brazil and Southeast Asia, Yang said.
The company is the second-largest smartphone vendor in China after Samsung. It also enjoys about 10 percent of market share in Southeast Asian countries.
Smartphones and tablets are the weapons Lenovo will use to advance into the United States and the European Union.
The company plans to sell at least 10 million tablets in the fiscal year that ends next March.
Its tablet shipments the previous fiscal year totaled 1 million.
“Smartphones and tablets are both profitable at the moment, and we will constantly be looking at ways to expand our business,” said Yang.
The company also launched an assembly plant in the central city of Wuhan, Hubei province. Annual mobile device shipments from the plant are estimated to reach 100 million.
Liu Jun, the Lenovo senior vice-president who heads its consumer product unit, said strong delivery power will help the company sell its products at a better price, which will help gain more customers at the lower end of the market.
Fairfax, the Canadian insurer led by Prem Watsa, in late September struck a preliminary $4.7 billion deal to buy the shares of BlackBerry it didn’t already own and take the troubled smartphone company private. Since the announcement of the deal, which Fairfax can walk away from at no penalty, investors have reacted skeptically, sending BlackBerry shares down more than 11%.
On Friday, Fairfax held a conference call to discuss its own third-quarter financial results. As soon as the call was opened to analysts’ questions, a request for an update on the BlackBerry bid was put forth.
Mr. Watsa, Fairfax’s founder and chief executive, declined to comment and quickly moved on. Investors will have to wait til Monday, when the due diligence period for the BlackBerry deal expires, to get an update.
Google, Samsung sued by consortium owned by Apple, Microsoft, BlackBerry, Sony
Reuters, November 01, 2013
The group that owns thousands of former Nortel patents filed a barrage of patent lawsuits on Thursday against cell phone manufacturers including Google, the company it outbid in the Nortel bankruptcy auction.Rockstar, the consortium that bought the Nortel patents for $4.5 billion, sued Samsung Electronics Co Ltd, HTC Corp, Huawei and four other companies for patent infringement in U.S. District Court in Texas. Rockstar is jointly owned by Apple, Microsoft, Blackberry, Ericsson and Sony.Google is accused of infringing seven patents. The patents cover technology that helps match Internet search terms with relevant advertising, the lawsuit said, which is the core of Google’s search business.A Google spokesman declined to comment. Representatives for Samsung, Huawei, HTC and Rockstar could not immediately be reached.Samsung, Huawei and HTC all manufacture phones that operate on Google’s Android operating system, which competes fiercely with Apple and Microsoft mobile products.
In 2011 Google placed an initial $900 million bid for Nortel’s patents. Google increased its bid several times, ultimately offering as much as $4.4 billion.
After losing out to Rockstar on the Nortel patents, Google went on to acquire Motorola Mobility for $12.5 billion, a deal driven partly by Motorola’s library of patents.
“Despite losing in its attempt to acquire the patents-in-suit at auction, Google has infringed and continues to infringe,” the lawsuit said.
Rockstar is seeking increased damages against Google, as it claims Google’s patent infringement is willful, according to the complaint.
The Google case in U.S. District Court, Eastern District of Texas is Rockstar Consortium US LP and Netstar Technologies LLC vs. Google, 13-893.
The lines are drawn and the sides for battle have been determined! The Rockstar consortium including the partners, Apple, BlackBerry,Microsoft, SONY and Ericsson, are engaged in a lawsuit against Google and everything Android (Samsung, HTC, Huawei);
BlackBerry has new BFFs in its consortium partners, and one of these companies, or Lenovo, or Facebook, is on the right side to help BlackBerry, as discussed:
Looking at the Fairfax deal we can try to understand the synergies to it. We can try to figure out why it may or may not make sense. With the facts being that if the BlackBerry management team, and the army of employees under them, were not able to complete the transition to date, why would Fairfax be able to do so? What mobile technology background does Prem Watsa have that BlackBerry currently doesn’t? There is none! What social media/network experience with on site ads for BBM Channels does this deal bring to BlackBerry? Again, none!
The Fairfax deal makes no sense except for Fairfax to get their original investment back out of BlackBerry. Firstly, the Board (with Prem Watsa, as a member) put the incentive in place for Thorsten Heins to sell BlackBerry and receive a massive payday by doing so. Then, in return, the BlackBerry CEO agrees to an ultra low sales price, a day after the stock price was trading higher. Within the agreement to sell BlackBerry to Fairfax is a financial clause that if BlackBerry was to take another offer for the company, Fairfax is to receive $150 million. We’ve seen deals where if the buyer backs out there is a financial penalty to be paid to the company that was to be bought. We’ve never seen a deal where if the seller finds a better offer they have to pay the original buyer! This clause is simply ridiculous! It’s set to ensure Fairfax gets paid handsomely for their efforts. Yet there’s no benefit for your average shareholder that has been vested in BlackBerry during the difficult times and still truly believes in the company and their technology!
Understanding the above, one asks the question, “Why would Fairfax set up a deal that begs for a superior offer?”- Fairfax has no interest in BlackBerry. They are a financial insurance company. They want their money back; and they’ll get it. It helps greatly if you’re at the table on both sides of the deal.
So what’s the end game then? Is it a sale of BlackBerry by any means possible? The assets are clear, the value is obvious, to those select companies that make it their business to know, BlackBerry’s current competition: Google, Apple, Microsoft, Facebook, Lenovo among others. All these companies have been or are currently rumored to be looking at BlackBerry to buy the company for its assets that the Fairfax deal has priced at half of book value. A steal by any assessment!
Knowing we are fast approaching November 4th, barring direct government support:
there is more than one form of support that could work.
This support could come from one of the aforementioned prospective BlackBerry suitors. One can make a clear business case for anyone of these potential suitors to take a substantial stake in BlackBerry, instead of buying the company. Supporting the company with an infusion of cash and the perceived stability created from the newly formed partnership, would substantially lead to gains for both partners in the resurgence of BlackBerry. A partnership has to be a match or fit that works for the two parties, and allows beneficial gains for each, from the union. With “partnership” being the key word, let’s, for the sake of a number, select a 49% stake from all of the current potential bidders and look at what the mutual benefits might be.
Facebook
The synergies between BlackBerry & Facebook make sense, so let’s start there as many of the benefits can be repeated with some of the other prospective partners.
“A strong partner like FB would ensure the cash they need to complete transition while maintaining R&D, it would bring a fresh new appeal to the BBRY brand and surely increase device sales. It would bring Instagram, followed by other top apps and stop the BBRY’s dead news but hopefully it will force a radical change of management. I think the German guy failed and he was still too close to Mike Lazaridis. BBRY needs new and outsider blood in the management team and surely a brand new marketing team made of under 35’s super talented people.”
[We take issue with the under 35 part of the quote—LOL!]
Let’s say Facebook bought a 49% stake in BlackBerry and that the two companies started to work together. Facebook doesn’t make hardware. It’s not in their DNA. The deal instantly gives FB a huge stake in a massive hardware market with fantastic potential. Let’s admit it, hard work has been done with BB10. The foundation has been laid. The future is bright, yet again what BlackBerry needs is a bit more time and more intelligent and sustained marketing across the globe.
“They’ve [FaceBook} been pushing for their own platform for a while, and are obviously not thrilled with how Google is dealing with them. They pushed an update that allowed Facebook to bypass the Play Store as far as updates are concerned, and Google changed the terms of service on them, forcing apps to go through the Play Store for updates. Seems like they’re trying to get away from Android, they just don’t have any other option. Not sure BlackBerry would be a good fit, but maybe they just want to keep their options open?”
Time and marketing are what Facebook can provide for BlackBerry. By doing so they can drive the value of the deal and return huge value in their new hardware alliance/division. Facebook speaks to over 850 million users. They are in a premium position to get the much needed word out about BB10, with direct marketing and ads on their pages.
Facebook could also bring the mobile advertising expertise to assist the emerging BlackBerry Social Network, BlackBerry Channels. Facebook could even have its own exclusive channel!
Apple
Let’s say Apple takes a 49% stake in BlackBerry. Even though Apple is ultra popular, the fact remains that they are losing the battle to Google and Android (think Samsung!). By supporting BlackBerry, Apple could again provide the time and money needed to complete the transition, that BlackBerry needs. Apple, by doing so, acquires a second front to battle Android. BlackBerry and Apple could work together improving Apple’s security. As BlackBerry grows, Apple retains the 49% of revenues. This would be similar to the rescue that Microsoft and Bill Gates offered Apple, years ago.
Google
Let’s say Google buys a 49% stake in BlackBerry. This, as with the other prospective partnerships, would provide the time and funding for BlackBerry to market its new OS. Google could retain extra revenue, and share patents (so could any other partner!). Google could advertise on BlackBerry Channels exclusively, using it’s expertise in on-line ad placements. Additionally, Google is still first and foremost a service provider. They could develop their apps for BlackBerry and Google could be rewarded (like any other partner) with BlackBerry’s security/BES10 & enterprise offerings. If Google were to do this, it would lessen the view they might be approaching monopoly status with Android. This is similar to the incentive Microsoft had with Apple back in the late 1980s.
Microsoft
Let’s say Microsoft invests in a 49% stake in the company. A non-compete agreement and cross IP sharing deal could be made, as with Google and Apple, or even Lenovo. This would give MS a serious new suite of security and MDM offerings to give it an edge over its competitors, Apple’s, iOS and Google’s, Android. Microsoft could seed BlackBerry OS10, diluting Android’s and iOs’ reach. Honestly, though, with its own strategy of seeding Windows 8, cross platform, we don’t see Microsoft buying a stake in BlackBerry for anything but the patents and BES10/NOC.
Samsung
It is not clear that Samsung would want to partner with BlackBerry, as it has no more to gain than say Microsoft, Apple or Google. Samsung is developing its own OS and already has its own version of Android that is very successful. It is neck and neck in the running with Apple for shear volume of hardware out in the global market.
Sony
This company is like Lenovo, but with a bigger hardware presence outside its own borders. Sony could benefit from the new BlackBerry 10 OS on its handsets, helping to differentiate it from Android and iOS or even Windows 8. Also, Sony, like Lenovo, would have security advantages using the BlackBerry OS10 on cell phones, which might lead to easier access to the BlackBerry NOC/BES10 than for even Lenovo. Sony had a partnership with Ericsson which never amounted to larger market shares. It might be willing to take a chance with a new BlackBerry partnership. We note that BlackBerry OS 10 phones were left out of the Japanese market by BBRY. Could this be a way to entice Sony with exclusivity in Japan, in exchange for its financial backing?
Lenovo
Let’s say Lenovo took a 49% or less stake in the company. Currently Lenovo has no mobile OS to call its own. Gaining a toe hold into BB10 may actually benefit them the most. By only having a 49% or less holding in BlackBerry, the security regulators would be hard pressed to frown upon the deal, if BlackBerry retains confidential the NOC and security side of the business. Together, BlackBerry and Lenovo, could dominate the Asian markets. Lenovo (like Facebook) would benefit in new ways that all the others wouldn’t, via the much needed mobile hardware/software and services expertise that BlackBerry would bring. BlackBerry would gain the financial backing it needs to finish its transition to BlackBerry 10 and machine to machine ventures with the new BBM, NOC/BES10 services. This partnership offers both sides benefits, as in the case with Facebook, whereas any prospective Microsoft, Google, Apple partnership, would most benefit BlackBerry. Any control of BlackBerry by the latter three companies or even Samsung, would most likely lead to a sell off and break up of BlackBerry.
Maybe, in the end, the biggest motivator that each one of these prospective partners has to enter into a new partnership with BlackBerry is to simply stop one of the others from accomplishing it first. Also, any prospective partner could get an advantage, in addition to the patents, and NOC/BES10, in the new machine to machine world via BlackBerry’s QNX:
News is breaking everyday that supports BlackBerry’s market offerings of Security first, with its unique MDM able to control not only Blackberry devices, but also iOS and Android devices. A cloud capability is also coming soon. Security is a marketable feature and BlackBerry needs to do a better job of advertising it, not only to enterprise grade customers but also to their everyday consumers who would be leery to learn about the databases of SMS and e-mail messages Google collects.
In summary, BlackBerry needs capital to market its new BlackBerry 10 portfolio and to buy it time to do so while completing its transition to the new platform while bringing new NOC services to the public/enterprise, BES10, BBM and BBM Channels. The two most obvious/often recognized suitors that would also gain most from a partnership with BlackBerry, are Lenovo and Facebook. Sony would also gain as much, if not as prominent a suitor. It’s not likely that Facebook has the assets on hand to flat out buy BlackBerry. Even if Lenovo could do so, it would face regulatory issues in Canada and the USA, leaving a partnership option the only path to move forward. Apple, Microsoft and Google, would have less to gain from a partnership with BlackBerry, having their own hardware/software vertically integrated, already. These three companies, as well as Samsung, would most likely use the patent portfolio and the NOC/BES10 secure servers/software to their advantages in gaining access to enterprise clients.
Stay tuned, as the cat will be let out of the bag, on or before November 4, 2013! Ofcourse, BlackBerry may decide to stay the course, on its own, public and Canadian, having acquired a second wind. Or, perhaps Mike Lazaridis might come into the picture, as part of the Fairfax deal or with other partners. What does your crystal ball say will happen? Tell us below in the comments!
UPDATE November 1, 2013 11:00 am:
The lines are drawn and the sides for battle have been determined! The Rockstar consortium including the partners, Apple, BlackBerry,Microsoft, SONY and Ericsson, are engaged in a lawsuit against Google and everything Android (Samsung, HTC, Huawei);
BlackBerry has new BFFs in its consortium partners, and one of these companies, or Lenovo, or Facebook, is on the right side to help BlackBerry as discussed above! Check this out:
Copyright 2013 (logo/sm, since 1993), all rights reserved, all content on this site! Photos may not be used without explicit permission, in writing, from PFC Systems, Inc.
Sydney – Australia – BlackBerry® (NASDAQ: BBRY; TSX: BB) today announced that Australia’s national transport safety investigator, the Australian Transport Safety Bureau (ATSB), has migrated to BlackBerry’s leading Enterprise Mobility Management (EMM) solution, BlackBerry® Enterprise Service 10. Responsible for improving safety in aviation, marine and rail transport, the ATSB is equipping employees with BlackBerry® 10 smartphones to securely capture, share, report and manage mission critical data at transport incidents from any location, including very remote areas on land or at sea.
Management, field investigators and IT support staff at the ATSB will use BlackBerry® Z10 smartphones, with plans to deploy BlackBerry® Z30 smartphones to teams in November.
As an independent government agency, the ATSB conducts investigations of transport incidents and accidents. Investigation teams use email and BBM™ to communicate and collaborate, and record safety data by filling in forms and taking photos that are sent to the ATSB’s database. IT and support teams conduct critical analysis and research to help identify causes of occurrences – used by the ATSB to improve safety and ultimately save lives.
“Being able to securely share real-time data from accident sites is crucial to our investigative role,” said Martin Dolan, Chief Commissioner at the Australian Transport and Safety Bureau. “With BlackBerry 10, our investigation teams are able to navigate to locations, take and share high-quality photos, and collaborate on data from any site they’re sent to, all within a network that conforms to the high security standards that we need.
“We chose BlackBerry 10 for its trusted security, ease of migration and cost-effectiveness, which has overall helped the ATSB realise significant savings. BlackBerry’s devices and management platform are helping to make investigative processes timelier and more comprehensive, while finding cost efficiencies through seamless migration and deployment.”
The migration to BlackBerry Enterprise Service 10 is the latest development in a relationship between BlackBerry and the Australian Transport Safety Bureau that spans five years. The combination of BlackBerry 10 smartphones and BlackBerry Enterprise Service 10 provides high security standards against data leakage and unauthorized device access to corporate assets. Security of corporate applications and data stored on personal devices (for BYOD deployments) is also embedded seamlessly within the user interface through BlackBerry® Balance™ technology. BlackBerry Balance separates corporate data from personal content, while preserving the end user’s privacy and consumer experience.
“We see this latest iteration of Blackberry’s mobility platform as an enabler of our own technology future, including plans to stream live video from investigations and if we choose to, support a broader range of device types within the organization,” Martin added. “We need to be as agile as possible if we’re to improve the safety of Australian transport. We look forward to working with Blackberry on solutions that will continue to enable our work and deliver a platform for future innovation.”
BlackBerry’s Managing Director for Australia and New Zealand, Matthew Ball said, “BlackBerry 10 is designed to support the needs of government customers, and we’re proud that the Australian Transport Safety Bureau has selected BlackBerry Enterprise Service 10, which helps their employees be adaptable and reliable in the field, and offers strong back-end security and management.
“To date, over 65% of our enterprise customer base in Australia and New Zealand have either deployed or are currently trialing BlackBerry Enterprise Service 10. In addition, we’re looking forward to helping more business and government customers, large and small, take advantage of BlackBerry’s secure network and services with the launch of BlackBerry’s new cloud-based enterprise mobility management solution coming later this year.”
For more information about BlackBerry Enterprise Service 10, please visit www.bes10.com. Now available from carriers and authorised resellers in Australia, the BlackBerry Z30 smartphone is the biggest, fastest and most advanced BlackBerry smartphone, with a 5” display and the largest battery ever on a BlackBerry smartphone. For information about theBlackBerry Z30 smartphone in Australia, please visit http://au.blackberry.com/
In the USA, Verizon will offer, in November, just in time for the holidays, BlackBerry’s latest cell phone offering, the all new 5″ super AMOLED,for $199 with a two year contract. We previously provided details on the new hardware, and 10.2 software:
New Z30 (right) shown next to the Samsung Galaxy S4 (left)
One cool feature of OS 10.2 is the “Adaptive Share” where the software on being requested to “share” something, learns your favorite “share” sites like BBM friends, BBM Channels, FaceBook and presents the top share selections as top suggestions with larger icons and top line placement of a users favorite sharing habits. For a recent media interview see the story below.
BlackBerry introduced the BlackBerry 10 platform in January, and in September showed off the Z30, its final smartphone for the year and one that completes the BB10 portfolio with now two touchscreen-focused options and two QWERTY hybrids, Vivek Bhardwaj, BlackBerry’s head of software, told journalists during a briefing Oct. 28. BlackBerry is hoping to stir up a bit more user interest in several ways. There’s that large, vibrant display; a battery that, in mixed-use scenarios, can last more than 24 hours, according to Bhardwaj; and new antenna technology from BlackBerry-acquired Paratak. “They have a very unique solution we’re using for the first time,” Bhardwaj explained. “Most antennas in phones are fixed, or calibrated for a few conditions. But what the Paratek solution does is re-tune on the fly, depending on the conditions. If you’re in a low-coverage area … it recalibrates the antenna so it’s optimized for that lower-coverage area.”
BlackBerry also gave the Z30 six microphones, which circle its exterior. On a conference call, “you can actually tell where people are sitting, it gives you such a strong spatial awareness,” said Bhardwaj. Called BlackBerry Natural Sound, it can better capture audio in a video at a concert, say, but also drown out ambient noise during a call to someone in a busy place.
On the software side, BlackBerry upgraded the Z30 to BB 10.2. One major change in the OS addresses a challenge so many apps are lately out to solve: sorting through too much email. In the Hub, 10.2 features a Priority Hub. The OS learns, as you use it, what’s a priority to you, though it’s easy to also designate contacts or conversations as Priority.
Also new are notifications that run at the top of the device, enabling a user to see a communication that comes in—a text, or an email, for example—while doing something like taking photos or reading in the browser. Without ever leaving the app, one can also respond.
Another little time-saver is on the locked screen. Where before a user could see, without unlocking the screen, that she had new emails and Tweets, now she can even read them, or parts of them.
They’re nice improvements, but are they enough? And why another touchscreen-focused device, when BlackBerry’s last earnings report made clear the Z10 isn’t selling? (The company sold 3.7 million smartphones during the quarter, the majority of which were running Blackberry 7, and posted a quarterly loss of $965 million.)
“It’s about the complete portfolio, and being able to offer it as a choice,” Bhardwaj said again. Maybe a customer goes into a store for the Z10 but decides he likes the Z30 better, or vice versa. “We’d rather we cannibalized by our own products.”
While he wouldn’t talk about the company’s pending sale, Bhardwaj suggested it was nothing that should keep buyers away.The average buyer, he said, just wants a great phone, he or she isn’t asking about the company’s financial standing. The idea that people are looking beyond product shelves into the details of companies is wrong, he said. “We have to break some of that distortion.”
More than 60 million monthly active users on BlackBerry devices with more than 20 million new iOS and Android users in the last week
More than 51 million daily active users who are connecting with friends or colleagues an average of one and a half hours every day.
BBM users send and receive more than 10 billion messages each day, nearly twice as many messages per user per day as compared to other mobile messaging apps
Almost half of BBM messages are read within 20 seconds of being received; indicating how truly engaged BBM customers are.
More than 60 million monthly active users
A positive article (not even considering the Channels Playcard!) on Forbes states:
“BBM Could Be Worth Billions if BlackBerry Can Copy The Line PlayBook” –Tero Kuittinen, October 25, 2013, Forbes.
It is difficult to get a handle on what the early success of BlackBerry’s messaging service on Apple’sAAPL +0.47% iOS and Google’sGOOG +0.49% Android platforms might mean. By Friday 3 PM, BBM has become the #1 app in 80 countries. It hit the 10 M user mark on iOS and Android platforms in 24 hours, yet continues performing remarkably well on its fourth day. It seems that the early wave of super loyal BlackBerry users and curious rubberneckers is segueing into sustained interest in the app. But how to value a free download app that currently offers no paid add-on features or advertising that would create cash flow? The best comparison here is probably LINE, the wildly popular text-messaging service that is now closing on the 300 M download mark.
CEO Thorsten Heins introduces the BlackBerry Z10 (Image credit: AP Photo/The Canadian Press, Nathan Denette)
Here is the tricky part: LINE, one of the most successful monetization cases in the messaging business, only launched its game service in July 2012. At that point, it had hit 45 M users. It seems possible that BBM could build a similar pool of fresh iOS/Android users in a matter of months. After launching the game service, it took just 9 months for LINE to hit 100 M game downloads. By spring of 2013, LINE’s game and sticker revenue was topping $100 M a quarter. LINE’s strategy of leveraging a free messaging app to build a wildly profitable game marketing platform took just 12 months to execute. The approach is still so novel that it’s hard to evaluate whether it can be copied by other vendors and how the revenue growth patterns might look after two or three years. But it is clear that at least in Asia, possessing a popular free messaging app is the most effective way to promote games. Right now, 19 out of Top 20 highest grossing apps in Korea belong to the KakaoTalk messaging app platform.
By Friday afternoon, BBM still clung to #2 position in the US iPhone download chart – and remained the #1 app in major markets like Turkey, Mexico, Netherlands, Spain, UK, Switzerland, Malaysia, Philippines and Indonesia. It is particularly interesting that BBM is performing so well in markets where BlackBerry never broke through as a smartphone. It is a Top 10 app in countries like Hungary and Italy. It has hit Top 30 even in Sweden and Finland, the European markets that used to be the most hostile towards BlackBerry devices, never even yielding 2% market penetration for BB.
It took LINE 400 days to reach 100 M registered users. BBM currently has around 60 M users on BlackBerry devices and perhaps 15 M on iOS/Android. The BlackBerry user base is likely set to erode relatively rapidly – but the strong early iOS and Android momentum seems to indicate that hitting 100 M users across all platforms could well happen by next summer. Of course, it is far too early to make solid projections for BBM growth. But its success in several key markets in its first week has already eclipsed anything LINE has managed. For example, this past summer LINE could only crack the US iPhone download chart for a single day, peaking at #18. App download market is utterly dominated by games – messaging apps very rarely crack the Top 10 chart of any market and often tend to achieve this in a very narrow spectrum of countries.
In contrast to LINE, WeChat and Kakaotalk, the early traction of BBM is surprisingly even across Latin America, North America, Caribbean, Africa, Middle East and South East Asia. The only major markets where it is really striking out are Japan, Korea, Taiwan and China. This is to be expected – LINE dominates Japan absolutely, Kakao rules Korea and WeChat has a lock on China. But in markets like USA, UK, Brazil, South Africa and Indonesia, BBM has been able to rack up massive early download volumes even against rival services with very high established market penetration. It looks like BBM has a decent chance of vaulting clearly ahead of rivals such as Tango, Kik and Nimbuzz in coming months.
If BBM hits the middle tier between behemoths like LINE and WhatsApp who are closing in on 100-300 M active monthly users and smaller rivals like Tango and Nimbuzz, how would the service be valued? That depends entirely on whether BlackBerry can build an effective content distribution/marketing system on top of BBM. If it can copy the LINE playbook and start offering social games once it has 45 M iOS/Android users, BlackBerry could be hitting the game platform stage already next spring. BBM currently has strong traction in some of the most lucrative mobile game markets in the world, including USA , UK and Germany.
Expecting BBM to match LINE’s $100M a quarter game/sticker revenue by end of 2014 is a stretch, because BlackBerry has no prior experience in managing this type of business and Japanese consumers are more willing to pay for extras than their Western peers. But a successful BBM network across the globe is a potential marketing platform that could reach revenue of tens of millions a quarter in short order. What BlackBerry needs right now is a clear, effective strategy of rolling out LINE-like content offerings and tailoring them to each major market. If the company can manage this, BBM alone could have a substantial valuation by next summer. LINE is planning a Tokyo IPO right now and its market cap is being tentatively estimated to be in the $8-10 B bracket.
Creating a service that could reach just one quarter of LINE’s success should be in BBM’s grasp – and could be a major reversal of fortune for BlackBerry. Much is now riding on how the company handles its BBM content delivery strategy.
My intention was to express my concern over the sale, to explain why I believe it’s not a just reaction to the current circumstances at BlackBerry.I also wanted to provide clear solutions instead of simply addressing the obvious problems. Perhaps understandably the process of writing the letter and the reaction to it from readers, has lead me to believe more needs to be said.
My biggest concern has always been the muted reaction from Canadians to the potential loss of BlackBerry to a foreign bidder and the reputational loss to the Canadian Stock markets & Canada as a competitor on the 1st world stage. It’s a given, if BlackBerry was to be taken over by a foreign company or even taken private, it will not look good upon the Canadian Stock Market, and on their ability to support their listings. Canada will lose a foothold in high tech/high talent jobs and intellectual IP built by Canadians, as happened with Nortel and the Avrow Arrow:
The question becomes why? Or a deeper look asks, what’s really going on?
Previously I gave examples of how Americans support their publicly traded tech companies. How they support their technology companies through their financial markets.
I provided data on how Facebook, Twitter, Netflix and Tesla among others, trade at hundreds of times their earnings. These massive multiples are amassed in part because of how the American financial system is set up to support their technology industry & other listed stocks.
Hedge funds backed up by massive media outlets provide a megaphone to the American population, extolling the virtues of said companies while simply ignoring the potentially dangerous multiples those companies trade at. The hedge funds provide the analysis and the media provide the megaphone.
American TV networks and news media protect and build value for their companies. It is often the same ownership at the helm of the media and companies being built up, with the same vested interests; the same power makers and lobbyists that offer the venture capital.
Once you take a closer look. You see the connected nature of the system. You see how everyone stands to benefit from the consistent positive spin. It’s true that the media players bring out market bears, that give the opposite view of the market and the companies we’ve been discussing. But by carefully controlling the content and ratio of positives vs negatives, the resulting perceptions are built casting a reality; all this gets to carry on as those companies with the massive valuations, far outside their ability to earn money proceed to use those funds to buy actual value.
Canada lacks the global reach of the American Media, and often the Canadian media just tows the line on what is fed via the American news outlets.With all levels of media being controlled by a select group of lobbyists/venture capitalists/owners at the top, almost as a single entity, it can turn that perception machine into a force against a company. This negative analyst/media frenzy can destroy or devalue a company like BlackBerry to the point where it can be sold at “auction” with the same nay sayers being able to buy up the pieces at half of book value.
All we have to do is look at the American system and how it creates value in very junior companies, even if not public yet. As an example, PATH, a newly formed instant messaging service, started by an early Facebook employee, someone who knows the system, knows the venture capitalists and how the media outlets can be manipulated.
PATH recently reached 10 million users of their service, some say with illegal means:
The financial system in the USA values PATH at $1Billion; they recently received additional venture capital funding. Yet the book value of the company is nowhere near $1 billion dollars, most of the valuation is based on future earnings potential.
By contrast, BlackBerry has an instant messaging system, BlackBerry Messenger. Many would argue BBM is far more feature rich than PATH. Plus, they had 60 million users previous to BBM launching on Android and Apple over the last week, when BBM was downloaded 10 million times in the first 24 hours! It was downloaded over 20 million times before the first 3 days. As I write this, millions more people are about to get started using BBM, now that there is no “line”. Yet with the current Fairfax offer that’s on the table for BlackBerry, at one half of BlackBerry’s book value, BBM is receiving a value of $0. That’s to say that BBM has zero current value or future potential value given to it by the market and analysts.
BBM Quick Facts:
More than 60 million monthly active users.
More than 51 million daily active users who are connecting with friends or colleagues an average of one and a half hours every day.
BBM users send and receive more than 10 billion messages each day, nearly twice as many messages per user per day as compared to other mobile messaging apps.
Almost half of BBM messages are read within 20 seconds of being received; indicating how truly engaged BBM customers are with the platform.
Let’s have a look at another social media company that has yet to go public, Pinterest. Again this company is strictly funded by venture capital. They call it “venture capital” at the early stages but all venture capital is hedge funds & large bank investment arms, often the same funders that have analysts on pay rolls to “review” the market. They’re able, through their market position and ability to promote start ups, to gain early access to the companies in the US. Pinterest is valued at $3.8 billion by the US venture capital system. They have recently reached somewhere between 25 to 50 million users, depending on who you listen to, but they have yet to ever earn a dollar. They admit to not having an actual plan to make money and aren’t even worried about that, at this time.
If you take these two examples alone & compare, not BlackBerry as a whole, but only BlackBerry’s social arm, BBM, and the forthcoming Channels network, I ask how is it possible that the market gives BlackBerry’s efforts zero dollar value? BlackBerry’s BBM alone, as we speak has better than 85 million users. It’s currently growing by millions a day, with users being spread over 180 countries.
BBM Channels will be an independent arm of BlackBerry’s Social Networks, although every BBM user will have access to channels through its chat feature. Channels is still in late stage beta. As a beta tester and channel owner, I can tell you that BlackBerry is on to something big here. Channels will provide businesses, consumer brands, celebrities and everyday individuals a fantastically colorful and secure and private (if chosen to go private) way to interact. The future potential is clear & valuable. Yet, the market gives Channels + BBM zero worth in the current sale of the company at half of book value. Prem Watsa and Fairfax will get a company at “auction” with much more future earning potential than the share holders will be paid.
A positive article (not even considering the Channels Playcard!) on Forbes states:
“BBM Could Be Worth Billions if BlackBerry Can Copy The Line PlayBook” –Tero Kuittinen, October 25, 2013, Forbes.
A world where smart phones will become the entry point of the connected devices. It’s early but this new world is coming up around us, more and more so, every day. First on the agenda would be automotive infotainment and drive train diagnostics. The hands down leader in this brave new world is QNX. The software code, Real Time OS (RTOS), behind the new BackBerry 10 OS cell phones is present in over 300 million current automobiles and their future products. QNX Car2 is already gaining mainstream acknowledgment as the industry standard. QNX is not just in automotive either. Many fail safe industrial systems rely on the QNX RTOS as the only system reliable enough to stand up to their difficult tasks. Military, nuclear and aerospace are counted among them. The F35 Lightning the Abrahams tanks the International Space Station and many of the world’s nuclear power plants rely on QNX. These vastly important BlackBerry customers are not the point though. They are an example of the power and reliability of the BlackBerry, QNX RTOS. Again, very little press or value is given to this ownership by BlackBerry.
“We Aim To Be The Leading Provider of Machine to Machine Embedded Systems” -Frank Boulben- March 16, 2013
Take QNX and couple it with BlackBerry’s Network Operations Centre (NOC) and we understand that this is one of the world’s largest networks which is connected to over 650 mobile carriers worldwide. The bigger picture starts to emerge. BlackBerry holds the key to the largest private “secure” network there is and which is relied on by the likes of NATO the DOD the DND and many national governments around the world for its unmatched level of security. BlackBerry10 operating system & BES10, BlackBerry’s latest MDM or “Mobile Device Management” solution has recently been employed by all of them. Recently, BlackBerry launched their cloud based #MDM solution. That adds unmatched cloud integration. BlackBerry has also secured Android & IOS with BES10.
Everything ties together, BlackBerry is a vertically integrated secure mobile platform & business solution. From the hardware to the software, through the services, that include transfer of data via the NOC & BlackBerry’s network. They have spent the last 2 + years rebuilding the suite of offerings, rewriting the entire architecture of how everything communicates through the network. The foundation is now in place, and it is built for security first. The future is at hand. The QNX RTOS has the ability to communicate with its own kind or other systems that run QNX RTOS through their “transparently distributed processing”:
The connected world is coming and BlackBerry’s technology, whether Canadian or not will be at the forefront of this massive new market including military, industrial, medical and other segments.
Now is not the time for Canadians to be selling BlackBerry for half the value of their hard assets. Now is the time that Canadians should be investing in BlackBerry and investing in Canada’s future, to be at the forefront of a super-connected world.
The American system is the land of what they call “Activist Investors”. These men and women can be worth billions; they are the venture capitalists that offer money, the key industry leaders that sit on several boards, from bank to media. They make it their business to invest in struggling companies and inact change long before the management of a company can fall so far behind in the perception game. They fully understand how a company’s perception becomes its reality.
Activist investors step in and fight to change those perceptions. At times, just the information that an activist investor has got involved in a company is enough to enact change. Sadly, Canada appears not to have any activist investors of the magnitude, technical knowledge and/ or will needed to complete the change started at BlackBerry.
In my letter to the Government of Canada, I recommended that the government request Jim Balsillie to return to BlackBerry as the CEO to fight for the company he once owned. The company he built into a worldwide $20 billion behemoth! Here’s hoping that Jim Balsillie or some other Canadian steps up and fights for BlackBerry to remain Canadian and public. The current CEO does not appear up to the task of completing the BlackBerry transition. Thorsten Heins, top management, and the Board of Directors appear to have lost their resolve to keep BlackBerry moving. That doesn’t mean that someone else can’t!
We live in a gloabal society and there can be alternative views fostered and developed by alternative thinkers/companies. BlackBerry has invented the global communicating hardware, championed and used by so many of industries’ titans in Canada, the USA, all over the world! There can be a real alternative to Apple, Android (Google) and Microsoft. There can be intellectual creativity from different nations shared globally! The market space is large enough to foster healthy competition! Innovation cannot happen by assimilation! To all my friends, all over the world, on #TeamBlackBerry, who fight the perception campaign daily, as best they can, I encourage you to support many of us in our bid to keep BlackBerry alive as a public, and preferably Canadian, company. Anything can happen in a sale. You can do your part to help BlackBerry #KeepMoving, by supporting this movement. Repost this and re-tweet it by clicking on the “Twitter” or “Facebook” “button” below! Or, copy and paste this 140 character tweet:
Here’s hoping that you will get on board with this movement and support a titan of innovation, BlackBerry, an alternative reality, an alternative future, before it’s too late. Going private will weaken the brand and the biased/unbiased media scrutiny would remain! BlackBerry needs a serious marketing strategy, and perhaps putting BBM on iOS and Android devices is the beginning of a game-plan?!
We can do this!
BlackBerry-An Alternative Reality, An Alternative Future
Darryl McKinnon.
getdjmac@hotmail.com
@getdjmac
C0007CCC8 Channels
Check out our most recent post on the prospective partners for BlackBerry here:
Copyright 2013 (logo/sm, since 1993), all rights reserved, all content on this site! Photos may not be used without explicit permission, in writing, from PFC Systems, Inc.
BBM tops both the iOS and Google Play charts–world-wide! The number of BBM users is near 100 million with the line to download the app for Android and iOS being eliminated. BBM is also the number one downloaded app on Google Play. This is a great way to market BlackBerry OS10, by loading BBM on the competition’s devices, with the OS 10 swipes, panels, and gestures! What do you think of this social marketing? Is it too late?
BBM messaging is totally free over wi-fi or data with no long distance texting charges and no accrued text count. It is secure and private, no need to give up you tel# or privacy. Give it a try and add your international friends as a contact on your iOS and Android devices! Let’s stay together! Keep moving! Share the love! Rome, I’m talking to you! Tell your friends and family that you would like to be able to keep in touch with no extra “roaming” or long distance text messaging charges and to do so in a secure way.
There was little incentive for the executives at BlacKberry to have allowed OS 10 to succeed, I predicted this on this Blog in another post. Just like Leo Apotheker, who destroyed the WebOS launch for HP, Heins has had little incentive to watch OS 10 succeed. I am sure he has tried, but in the face of the steep challenges, is he/has he loosing/lost his resolve? Let’s look at a previous** analysis:
With RIM/Blackberry certainly taking on the appearance of a company painfully circling the white porcelain bowl, I thought that the time was right to take a look at how the company’s CEO, Thorsten Heins was compensated in 2013 and how he will benefit from a change in ownership, a scenario that is extremely likely with the announcement of the signing of a letter of intent with Prem Watsa’s Fairfax Financial Holdings.
Mr. Heins took over as President and CEO in January 2012 after serving as Chief Operating Officer of Product Engineering. Interestingly, according to the 2013 Proxy Statement, Mr. Heins received 85.15 percent approval of the company’s shareholders with a significant 14.85 percent of shareholders withholding their votes, the only way that shareholders of Canadian companies can express dissatisfaction with a Board Member.
Let’s start by looking at Mr. Heins’ compensation (and that of the other Named Executive Officers or NEOs) for 2013 and the previous two years to put things into perspective:
Mr. Heins’ base salary was $1,000,974 and he also received long-term incentive awards (LTIP) totalling $6,190,833 in “recognition of his outstanding performance in Fiscal 2013.”. His LTIP consists of 381,679 shares at a grant price of $7.86 (restricted stock units) and 763,358 shares at a grant price of $7.86 (stock options) as shown on this chart:
Including Mr. Heins’ non-equity annual incentive payment (AIP) of $1,717,295 (172 percent of his annual base salary), granted because he exceeded targets set by the Board , his total compensation package for fiscal 2013 was $9,065,077, down from $10,274,324 in fiscal 2012. Poor fellow indeed. I do find all of this compensation information fascinating given that this is what happened to both net income and the value of the company’s handset sales over the past three years:
Now, let’s get to the meat of the matter, the golden parachute that Mr. Heins will receive if there is a change of control of the company. If Mr. Heins is terminated before or within 24 months following a change of control, he will receive:
1.) A lump sum equal to twice his annual base salary (currently $1,000,974).
2.) Contributions to continue all non-equity benefits including extended health and dental coverage for 24 months.
3.) An annual incentive amount equal to two times base salary multiplied by the current AIP target percentage. Based on the current base salary AIP target of 1.5, the payment would be $4.5 million.
4.) All stock options and RSUs are immediately vested and can be exercised over the next year or the applicable time remaining on the grant agreement, whichever is shorter.
5.) If the termination date occurs before the Grant Date, the company will pay Mr. Heins $33.75 million.
Apparently, there are very strong personal reasons why the current executive team would be looking for a change in control since all of the NEOs have similar agreements.
Now, for comparison’s sake, let’s see how the company compensated the “sweaty masses” that were turfed in 2012. The company’s “2012 Cost Optimization Program” that saw the layoffs of approximately 2000 employees or 10 percent of the total workforce cost the company $125 million on a pre-tax basis in fiscal 2012. During 2013, the company made cash payments of $10 million to terminated employees and paid an additional $24 million toward facilities costs.
I realize that this isn’t directly related to the subject of this posting but, as a Blackberry owner that had my first phone crash within the first week that I owned it, I found this information interesting noting that the numbers are in millions of dollars:
Basically, since fiscal 2011, Blackberry has spent $1.816 billion settling warranty issues on their products. While I don’t have comparable data from other smartphone manufacturers, that may explain some of the issues facing the company.
Lastly, if you want to see who got screwed in this whole debacle, this graph explains it all in a nutshell:
Shareholders saw an investment of $100 in March 2008 plummet to a value of $12.77 in March 2013 at the same time as total Named Executive Officer compensation rose from $15,544,628 to $25,044,614. Granted, from 2012 to 2013, NEO compensation dropped from just under $31.7 million to its current level, but that’s small compensation for the company’s much beleaguered shareholders.
Once the market sees a company as weak and vulnerable, perception becomes reality and there is very little chance of recovery. Such is the case for RIM/Blackberry and this year’s rebranding did nothing to change the company’s plunging fortunes. Fortunately, for the company’s NEOs, they get paid handsomely either way. Unfortunately, long-term shareholders do not.
According to a report in the Wall Street Journal of today, Lenovo is the latest company to be interested in taking a look at the state of BlackBerry. Lenovo originally showed interest in BlackBerry last May when the Canadian government had expressed concern on a foreign buy out of BlackBerry, especially with regards to National Security. Do you think that Lenovo, the enterprise ThinkPad builder (having bought the PC making division from IBM) is a good fit with BlackBerry? Comment below!
With the launch of the Z30 today in Canada we decided to take it to the street for some first hand observations on the state of BlackBerry in Laval,Québec. Centre Laval was visited, a shopping center, close to a high traffic corridor with several highways nearby providing easy access. Here is what we heard and saw:
Future Shop
There are no more Z10 cell phones in inventory. Not likely to get anymore. There are three Q10 and three Q5 devices plus one Z30 on display (only inventory). No one buys the Q5 and the Q10 sells more than the Z10. There is no Z10 in inventory.
Three customers in store at “Cell Shop” department. Dalia, the sales person, states that people are afraid to buy BlackBerry cell phones since they fear the company will go the way of Nortel. Sales have dropped since the end of September.
Best Buy
In one month they sell 5 BlackBerry devices, usually the Q10, with the Samsung S4 at about 50 a month and the same for iPhone.
Not a single Q5 device was sold by this sales person since its launch in Canada. One Z10 with Rogers and one Z10 with Virgin and three Q5 cell phones with Koodo are in stock.
Ali, the sales guy says people believe BlackBerry is going to be split and sold and this is why people won’t buy the devices. Sales are worst now since the announcement of the special committee to investigate strategic options and subsequent news. A customer confirms this idea and says that he used to have a BlackBerry and won’t buy another BlackBerry in the future; the new BlackBerry doesn’t appeal to him. He’s not interested because he’s used to the iPhone now and all the apps and he is worried that BlackBerry won’t be around. He is comfortable with the iPhone. He gives the impression that he has not really tried a new OS 10 BlackBerry.
Rogers Kiosk
Carol, the sales person says she is selling her Q10, because of the lack of apps, and cites as an example Bank of Montreal. Carol loves the Q10 because of the key board and the OS10. She switched from the iPhone because of the key board. The banking apps are important. The camera needs to be improved. She says that the poor camera was the final straw for her with poor quality pictures, and not enough Mega Pixels leading to poor resolution. With a poor app ecosystem BlackBerry needs to have a high resolution camera. I did mention the digital signal processing available and the android run time for “jellybean”, but she wanted it to be there already. She does not want to have to side-load apps.
She has in inventory one Q10, two Q5 and two Z10 devices. Since the board decided to explore strategic alliances or sale of BlackBerry, sales are Samsung to BlackBerry 50 to 1 and they were 5 to 1 before the September announcement. People are asking for new LG phones now, before BlackBerry.
Telus Kiosk
Matiu says kids like the iPhone because kids want apps. There is no marketing for the Z30. He has at least four or five Z10 and Q10 devices in stock with one Z30 and 2 or 3 stocked Q5 phones. Sales are 50 to 1 Android to BlackBerry. Same iPhone to BlackBerry. People have no idea of the re-invented phone OS. BlackBerry needs to better market its products.
Fido Kiosk
Xavier says the Nexus 4 by LG is selling well. Personally he doesn’t like BlackBerry because it’s old. He doesn’t sell BlackBerry because people have problems with using the new OS, they need to be educated. He sells a lot of Bold devices with keyboard because of BIS and cheaper to use messaging. He carries the Z10, Q10 and Q5. He sells 3 to 1 Android/iPhone to BlackBerry (manly OS 7 devices with BIS).
Koodo Kiosk
Haron says the customers ask for what they want and it’s not BlackBerry. BlackBerry is overpriced and students want cheaper. Haron says that even on Fido kids pay more for the iPhone and the more expensive plans because it’s an iPhone.
Casual Observation at Presse Café
(at Centropolis)
While at this coffee shop, amid the iPhone and Samsung S4 users, I could see some older BlackBerry devices and that one older couple had a Z10 and Q10 between them.
Summary
In summary, it appears that the same problems that exist for BlackBerry in the USA, also exist at home in Canada: poor marketing and education on the new BlackBerry 10 phones, poor app ecosystem even the “grown-up” apps, like banking apps are missing, mixed messaging with regards to the future and commitment of BlackBerry to the consumer market. All of this has tarnished the once cool brand and nothing is being done to change this with an absent marketing effort and missteps in execution, market research and planning of new devices that people want. Perhaps, BlackBerry recognizes this and hence its open letter in thirty newspapers in 9 countries today.
(Written with docstogo on my Q10 like Dev C and pasted into WordPress for android run time; all photos taken with said BlackBerry device.)
As the Z30 launches in Canada, tomorrow, October 15th, BlackBerry will be going to print media to convey their message loud and clear that their uses can continue to trust and count on BlackBerry as it re-invents itself. Could this mean that the BlackBerry Board will not entertain any offers that will split up the company?
BlackBerry will be posting a letter in over 30 major news publications across 9 countries to let long-time BlackBerry users know, “You can still count on us”. They want the world to know they’ll still be there to provide best in class security, productivity, Enterprise Mobility Management, and social networking.
Here is the letter, in a press release:
BlackBerry
To our valued customers, partners and fans,
You’ve no doubt seen the headlines about BlackBerry. You’re probably wondering what they mean for you as one of the tens of millions of users who count on BlackBerry every single day.
We have one important message for you:
You can continue to count on BlackBerry.
How do we know? We have substantial cash on hand and a balance sheet that is debt free.
We are restructuring with a goal to cut our expenses by 50 percent in order to run a very efficient, customer-oriented organization.
These are no doubt challenging times for us and we don’t underestimate the situation or ignore the challenges. We are making the difficult changes necessary to strengthen BlackBerry.
One thing we will never change is our commitment to those of you who helped build BlackBerry into the most trusted tool for the world’s business professional.
And speaking of those dramatic headlines, it’s important that we set the record straight on a few things.
Best in class productivity tool.
We have completely revamped our device portfolio this year with the launch of BlackBerry 10. We have four BlackBerry 10 devices – two all touch and two hybrid (touch and QWERTY) – and all are running the third update of our new platform. If what you care about most is getting things done – taking care of your business – we have the best range of devices for you. And we continue to offer the best mobile typing experience – no ifs, ands or buts about it.
Best in class security.
Governments all over the world, global corporations and businesses that simply cannot compromise on security choose and trust BlackBerry. Security is our heritage, and the industry recognizes that BlackBerry is the most secure when it comes to the device, server and, of course, our global data network. Have no doubt that you can continue to trust us to keep your communication safe and private.
Best in class enterprise mobility management.
We changed with the market, embracing BYOD because we understand that as iOS and Android devices become common in the workplace, businesses still need to manage all of these different platforms seamlessly and securely.
This is not a trivial task. While there are a number of startup companies that make bold claims, BlackBerry has more software engineers and the most resources dedicated to developing the most innovative solutions to address this complex challenge.
And our customers know it. Over the past quarter, our BlackBerry® Enterprise Service 10 server base grew from 19,000 to more than 25,000. Corporate clients are committed to deploying and testing the latest enterprise technology from BlackBerry. We are committed to evolving with our customers. That will never change.
Best in class mobile social network.
We are bringing the most engaging mobile messaging platform to all, with our BBM launch for Android and iPhone.
There are already around six million customers pre-registered to be notified of our roll out. This number is growing every day, and speaks to the tremendous opportunity we have to expand BBM beyond BlackBerry smartphones to make it the world’s largest mobile social network.
Yes, there is a lot of competition out there and we know that BlackBerry is not for everyone. That’s OK. You have always known that BlackBerry is different, that BlackBerry can set you apart. Countless world-changing decisions have been finalized, deals closed and critical communications made via BlackBerry. And for many of you that created a bond, a connection that goes back more than a decade.
We believe in BlackBerry – our people, our technology and our ability to adapt. More importantly, we believe in you. We focus every day on what it takes to make sure that you can take care of business.
You trust your BlackBerry to deliver your most important messages, so trust us when we deliver one of our own: You can continue to count on us.
It goes without saying that BlackBerry gets negative press from media outlets and analysts, especially in the USA. We have written before on how some of the current state of affairs for the company is due to poor marketing, market research and poor execution.
We’re in Canada to take a first hand look at the upcoming Z30 launch on Tuesday, October 15, 2013. Telus will be offering the phone on a two year contract for $129 and off contract for $650. Are you planning on getting this new phablet from BlackBerry? Leave a comment on what you are doing / thinking about the Z30.
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