Is being a “niche player” feasible for BlackBerry?

BlackBerry board member Bert Nordberg has a history of playing an active role in helping companies turn the corner away from their troubles. He played a role in Sony Ericsson’s revival which, in part, involved seeing Ericsson sell its stake in its mobile phone unit to Sony, resulting in a better disposition for both companies.

Viewed from 30,000 feet, decisions made by directors and board members are understandable. When you are one of the employees on the ground and in the field, the decisions and their consequences do not seem so worthwhile.

This past week, Nordberg was quoted as saying that he thinks BlackBerry can survive as a niche company if it chose to do so. Frankly, I am not convinced a solution like that would work if the company has to break itself apart in the process. Which niche would BlackBerry occupy? In the mobile sector, there are not so many niches to be occupied that cannot be addressed through other solutions, that is not to say it is impossible though.

Hardware

The BlackBerry Q10 is pretty much the lone occupier of the “portrait QWERTY keyboard packing smartphone” category (Q5 not withstanding). It is a fine device too. The keyboard lives up to the gold standard that BlackBerry is known for. In a world where full-sized touch screens dominate the landscape however, the Q10 arguably could serve only as a niche player for those focused solely on productivity. So there is a niche to be serviced there in terms of hardware, but the new hardware is not really the problem at this point except that it is not worth anything to the company.

Operating System

Where BlackBerry Enterprise Server in its current form is involved, there is limited room for BlackBerry’s clientele to grow. The BES framework (and its consumer cousin, BIS) geared around OS 7 is the cornerstone of what made BlackBerry a BlackBerry. This was the security lynch pin that other platforms could only dream about. It was not a perfect set up though, and many of those shortcomings (like spotty web-browsing, iffy data throughput) were addressed with BlackBerry 10 at the expense of the “BlackBerry-isms” that pretty much everyone liked (see my thoughts about that angle of BlackBerry here).

BlackBerry 10 does not offer the same level of management that enterprises are used to in their operating environment. There is a bit more flexibility, but the model is ostensibly no different than anything else out there. This has affected the legendary “push” email that used to be the hallmark of any BlackBerry user. BlackBerry 10 simply uses the same protocols as everyone else, no niche there.

BlackBerry Messenger

BBM sets a standard in instant messaging that people can understand only if they have actually used it. The problem is that the world has moved on since then with some very useful, albeit not quite as deep, applications. WhatsApp is the current elephant in the room, with more than 300 million users, and the app is available pretty much everywhere. Other applications that have individual and group IM ability include GroupMe, nicely polished and available across the major players (except BlackBerry).

There are a host of other messaging applications as well, Google Hangouts, Facebook, iMessage, Skype, Snapchat, et al. BBM has roughly 60 million users and in the face of the current environment, if BlackBerry were to spin BBM off as its own company, it would be solely to have
it sold off. There is no niche here either.

Behold, the QNX Neutrino "real time operating system" (RTOS) Secure Kernel

Applications

Okay, we know there is no niche here either, unless it is to occupy the niche of the least number of native applications. It was just such an obvious category, so I wrote this up just to say, “move along, nothing to see here.”

QNX along with Industrial Products and Services

This business unit is not getting a whole lot of time in the lime light, and that may be a good thing. If there is one area where BlackBerry has a niche, it is here. QNX continues to operate as a stand-alone entity, serving telecom, energy, automotive and defense sectors with products and services. Its kernel is the core of the BlackBerry 10 OS, but that is the least of QNX’s accomplishments. This entity alone probably holds the bulk of any value in the company. Indeed, this is a niche, but it is also a treasure trove that BlackBerry could spin off or hold on to in order to launch a new initiative.

Summary with a Tangent

BlackBerry is fortunate in that no particular outcome is guaranteed. The company could try to muddle along its current path, but at the expense of its investors. The consensus seems to be that the company will be selling off assets to pare down the scope of BlackBerry’s vision.

I can tell you one thing I would like to see happen, I want the name of the company changed back to Research in Motion. The name change was totally unnecessary in the first place. BlackBerry is a product of a company that does more than just make BlackBerry devices. It is a company that provides industrial services, and owns a robust portfolio of companies, like QNX and The Astonishing Tribe (TAT). BlackBerry is one of those products and services. Now, I cannot mention BlackBerry without clarifying if I am talking about the company or the product.

In short, I do not think finding a niche resulting from a breakup of the company is in BlackBerry’s best interest, though in the near term it may serve its investors better. The problem with sells-offs and spin-offs is that those entities that are spun get bought and inevitably a bunch of people lose their jobs through a “harmonization” or “synchronization” or “assimilation” (or whatever the catch phrase is used nowadays) of the merger or acquisition and then the product or service loses much of what made it special.  There are few exceptions.

Platforms like BlackBerry Messenger would benefit from being opened up for more users, but generated revenue from such an idea is going to be tough to do given the competition.  It would hardly produce a niche however.

I have a niche for BlackBerry: Business. Focus on the business applications (which will still serve social media) and take hold of their development with the tools in its arsenal.  The consumer driven user experience is going to continue to drive an uneasy evolution in the mainstream enterprise.  However, there is a robust market of mission-critical environments that will never be trusted to platforms that started as consumer portals for media.  That is a sector that BlackBerry (Research in Motion) can continue to serve with vigor.  When you look at all the ingredients that made BlackBerry a success, and continue to make the company’s offerings somewhat unique, it is unfathomable that this line-up cannot be successful in such a space.