How Long Can BlackBerry Survive?

Blackberry

Source: http://www.flickr.com/photos/langleyo/

BlackBerry (NASDAQ:BBRY) is in the midst of some tough times. The company’s fiscal year ended in March with a $423 million net loss. The new BlackBerry Z3 that the company tied so many of its hopes on is not selling as well as anticipated in the Indonesian market. Analysts predict that the company’s market share in the global smartphone market will slip to about 0.8 percent this year and drop down to 0.3 percent by 2018.

Despite these grim signs, CEO John Chen is optimistic that he can turn BlackBerry around and make it profitable again by March 2016. After all, he’s changed company cultures before at Synbase, where Chen previously was CEO. He even went as far as to say that he gives the company an 80 percent chance of survival at Re/code’s Code Conference. That was increase from the 50-50 chance he reportedly told The Financial Times in March.

“Yeah, we have problems, but it’s not dead,” said Chen to the crowd at the conference. “I’m confident we will be able to save the patient.”

He also said he is wiling to explore new areas for revenue. Part of his plan for becoming profitable again is to seek corporate and government clients for its business.

Chen said he would cut any part of the company needed to make it profitable again, including smartphones. BlackBerry was once the smartphone, but increasing competition has knocked it out of many smartphone markets, which are dominated by Apple’s (NASDAQ:AAPL) iPhone and the various brands under the Android umbrella, led by Samsung (SSNLF.PK). Even Windows Phones have a higher market share than BlackBerry. Despite its losses in popularity, BlackBerry retains a niche audience that includes several world leaders due to the security of BlackBerry’s network.

Building on that network and other assets of the company is part of Chen’s plan to make the company profitable again reported Re/code by building up business in new areas. Recent financial losses by the company have been due in part to the restructuring costs needs to put the company in a new direction. So BlackBerry may survive by changing with the times.

Chen is aware that he faces a great challenge in keeping BlackBerry running. He was appointed to the CEO position in November. Even before then, some in the business world have predicted the death of BlackBerry. Despite that he predicts that BlackBerry will have a future that doesn’t end in bankruptcy or other financial ruin, but in new profits for the company.

These profits will come from its mobile and server business and from cross-platform messaging. In other words, the future of BlackBerry is not solely in the hands of its smartphones, which is a good thing considering the smartphone market is now mostly an iOS Android playing field.

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