The past week was, at once, a great week and a very risky one for BlackBerry.
On the one hand, the launch of their new Passport smart phone went off without a hitch and generated a good amount of positive press. To add to the good news, the new partnership with manufacturer Foxconn is greatly reducing the financial risk of launching new phones for BlackBerry. If sales disappoint and if there is stock left over, Foxconn will absorb some of the cost.
On the other hand, there remains great public relations risk to BlackBerry’s reputation among customers and shareholders. No matter what the partnership agreement with Foxconn stipulates in terms of financial risks, BlackBerry is once again creating a “do or die” moment for itself.
Each launch since Thorsten Heinz took the helm has been positioned as a last chance for BlackBerry to make it in the smart phone market. If it doesn’t make it, consumer and shareholder confidence in the company, its products and services will once again be diminished. As Jeff Kagen expressed it to TechNewsWorld:
“The real question is will the Passport capture enough market share to help BlackBerry stay alive.”
In addition, with each new model launched, the audiences are reminded of the company’s fall from grace; the narrative is of a once-great company that is now at the bottom of the heap. This is not a good story for the company, its employees, partners, investors or customers.
Since John Chen took the helm, a different narrative had emerged of a more focused company, intent on growing its business with enterprise customers (i.e., big business and governments who value security in an uncertain world). Endorsements of BlackBerry by the US military and the German government, for example, helped to bolster confidence and push up the share price. The company was seen as playing to its strength and each new story of hacks and leaks and spies helped to make mobile security more relevant.
But now, and for the next quarter or two, the narrative will be more squarely on handsets and the relative success of failure of the Passport, the Classic and others. If one or more model succeeds, the company’s reputation will be enhanced. If the models all fail against these more modest expectations, the reputation will again suffer and questions about the very viability of the company will once again become the dominant narrative. Matters certainly weren’t helped by the massively successful launch of the new iPhone models (though reported security gaps in the operating system are a terrific opportunity for BlackBerry).
BlackBerry will do well to focus our attention on the other aspects of its business during this time. They need announcements and wins to lessen the attention on handsets and reengage the audience in a dialogue on security, software and innovation. The story on these new handsets has not yet been written and relying on it too much is risky.
I for one – as I have often stated on this blog – am cheering for this company and its people. I like what it has done for this country in terms of fostering research and development and I much prefer a physical keyboard to a piece of glass. I will be trying out the Passport and the Classic and likely choosing one or the other as my Bold 9900 enters its final months.