BlackBerry Ltd. shares rose over 2 percent on Wednesday morning after the designer, manufacturer and wireless solutions company unveiled its Passport smartphone at simultaneous global events in London, Toronto and Dubai on Sept. 24. The BlackBerry Passport, which has the size and shape of an actual passport, will include features such as a 4.5-inch square screen and a three-row keyboard that will cost $599 in the U.S.
“Blackberry needs to answer one simple question: Why would anyone buy a Blackberry device? That’s it,” Adam Sarhan, founder and chief executive officer of Sarhan Capital, said to IBTimes. “They need an elevator pitch to give to the world. Both consumers and businesses need a catalyst.”
BlackBerry also unveiled the new Porsche Design P’9983 smartphone at Harrods department store in London on Tuesday that combines the Porsche Design brand with the experience of BlackBerry 10 technology. Before the end of the year, the company said the BlackBerry Passport will be available through its carrier and/or distributor partners in more than 30 countries around the world.
“Unless this Passport has some kind of magical feature, then they have a really tall mountain to climb back towards the top,” Sarhan said.
This will be John Chen’s first global launch as chief executive of BlackBerry after taking over as CEO of the company in November 2013. But the questions he'll have to answer are legion.
“Back In the early 2000s and up until 2008, you had a very clear reason why to buy BlackBerry because no other phone at the time gave you instant access to your email. That was a clear added value,” Sarhan said. “Now there’s just ambiguity. Why BlackBerry?”
Security and Acquisitions
Chen's dealmaking strategy shows that the company knows it needs to be about more than just the phones. At a security summit in July at The Museum of Arts and Design in Manhattan Blackberry unveiled it had entered into an agreement to acquire Secusmart GmbH, a high-security voice and data encryption and anti-eavesdropping solutions company for government organizations, enterprises and telecommunications service providers in Germany and internationally. Not only does Secusmart have security across an enterprise system for governments, but also companies.
“The acquisitions are very important,” Sarhan said. “Blackberry has tried to form a little bit of a niche in security,” Sarhan said.
Another acquisition that has caught analysts’ attention is BlackBerry’s acquisition of Movirtu, a provider of virtual identity solutions for mobile operators that allows multiple numbers to be active on a single device. BlackBerry announced the deal in September to appeal to business users that can split a phone, as well as data, between personal use and company use with Movirtu’s SIM card technology, instead of carrying two separate phones.
“Movirtu seems like a smart play for BlackBerry,” James H. Gellert, Chairman & CEO at Rapid Ratings International Inc., said. “It’s a recognition of BlackBerry’s challenges as a device company and the fact that consumers have shown they don’t want to carry two devices.”
BlackBerry announced another major partnership in June with Amazon for mobile apps on Blackberry 10.3 scheduled to come out this fall that will add more than 240,000 Android apps. The Amazon Appstore will be preloaded with the Blackberry 10.3 app and available through a maintenance release for all existing Blackberry 10 devices.
“BlackBerry seems to be surviving right now,” Keith Bliss, senior vice president and director of sales & marketing at Cuttone & Co., Inc., said to IBTimes from the floor of the New York Stock Exchange. “We tend to look at our own little world and all we see are iPhones and Android devices. But BlackBerry is a global enterprise.”
Bliss said Chen has most likely seeded control of the retail market to tech giants such as Apple Inc., Samsung Electronics and other Android smartphone suppliers because that market is “so ingrained into retail consumers.” Analysts argue that BlackBerry is trying to go back to its enterprise customer because traditionally the business customer was their main bread and butter while the consumer was more of an iPhone or Galaxy user.
“BlackBerry still has a lot of services and businesses both on the phone side and as well as the enterprise software side for governments around the globe,” Bliss said. “They’re still the preeminent player when it comes to data security across those networks. That’s really what’s kept them in the survival mode right now.”