Frost & Sullivan Slam Blackberry Classic Strategy

1 min read Networks & Network Services
Blackberry has long been on the decline after once ruling smartphone market. Amid internal shuffling and a reinvigoured focus on the enterprise market Blackberry has decided to rely on nostalgia for the next stage of its strategy. Frost & Sullivan ICT Consultant Lawrence Lundy comments:

"The release of the BlackBerry Classic is an attempt to return to the company's former glory. With 0.7% global market share in Q3 2014, BlackBerry is almost an irrelevance in the current smartphone market. But with a strong global brand and support from enterprise and government, BlackBerry is hoping that the Classic will re-ignite support and lead to a turnaround in the company’s fortunes. This is unlikely to happen.

In the halcyon days BlackBerry’s key differentiator was BBM, free and secure messaging to other users of BBM. BlackBerry benefited from strong network effects and a lack of competition in the mobile messaging space. As competitors such as WhatsApp, Facebook Messenger and Viber grew; BlackBerry suffered from reverse network effects as developers stopped building apps for the BlackBerry platform. The release of BBM for Android and iOS has come too late.

BlackBerry’s traditional stronghold has been with enterprise where its focus on security played well with corporate IT departments. But as BYOD trends brought iOS and Android devices into corporate environments; the demand for BlackBerry devices has dwindled. This eroded the value of the BlackBerry Enterprise Server and whole BlackBerry solution. Security enhancements as well as identify-and-access control features in the latest versions of iOS and Android further reduce BlackBerry’s competitive position. Enterprise Mobility firms such as AirWatch and MobileIron offer companies the ability to manage any devices and application across any operating system. These are BlackBerry’s competitors now, not Apple or Samsung.

The re-release of the BlackBerry Classic is perplexing. BlackBerry should focus on providing world-class security and enterprise mobility services to corporate customers. It cannot provide an end-to-end enterprise mobility solution from server to smartphone. The smartphone war has been lost. Numerous attempts at new devices such as the Z and Q ranges and more recently the Passport have met with lukewarm sales. Without a reinforcing ecosystem, cross-platform support should be the priority. Maintaining an operating system and smartphone portfolio should not. Microsoft find themselves in exactly the same strategic bind. How to create differentiation on branded devices as well as support a truly cross-platform services business. These conflicting incentives are almost impossible to reconcile. The release of the Classic suggests BlackBerry believes it can do both. I don’t agree."