BlackBerry is aiming to become a profitable business in 2017 after years of poor financial performance caused by its troubled phone unit. In an interview with Financial Times, John Chen, BlackBerry’s CEO, detailed what steps the company has taken in order to return to profitability despite its failures to compete in a market it was known for within the past decade – smartphones. To achieve profitability, Chen decided to steer the company back to its original business, i.e. security and enterprise software. With this shift in focus, BlackBerry decided to no longer manufacture its own smartphones and instead license its brands to foreign manufacturers and charge licensing fees for every unit the manufacturers sell. This move allows BlackBerry to focus its investments in profitable ventures while still capitalizing on the brand it had built in the smartphone world. Aside from TCL in China, other manufacturers that produce BlackBerry-branded smartphones are PT BB Merah Putih in Indonesia and the India-based Optiemus. Chen also stated that the company’s partners will help it revive its smartphone business in the future.
With its departure from the hardware business, BlackBerry focused on its security and software business to make the company profitable, with the firm banking on increased demand for security software as cyber-attacks grow more intense. In fact, BlackBerry expects a massive jump in revenue coming from its software and security products, with the company expecting 30-percent growth this year. To ensure continued growth in its core business, BlackBerry has acquired several software vendors, giving the company a foothold in enterprise mobile management, crisis communications, secure document management, and cyber security services. Furthermore, BlackBerry is also involved in the development of software for connected cars, as Ford Motors committed to using BlackBerry’s QNX Embedded Software for its connected cars last year, and Chen claims that 60 million cars are currently using BlackBerry software for connectivity. Finally, BlackBerry is involved in the development of Internet of Things (IoT) solutions for connected fleets, focusing on location monitoring of trucks and cargo, and data delivery solutions for fleet management.
The company’s recent efforts to return to profitability have been influenced by changes in the markets that BlackBerry was once involved in. Its decision to license its brand to other manufacturers makes sense since the company had been losing market share and its recent forays into manufacturing Android-powered smartphones were not as successful as the company hoped. Nonetheless, BlackBerry will continue being involved in the smartphone world through the handsets manufactured by its suppliers and the software it offers for Android smartphones.