In our another journalist gets it’s wrong series, the latest installment comes from Surur of wmpoweruser.com in an article titled “Microsoft takes final step to kill Blackberry with free MDM”
In his article, Surur makes a very bold assumption that with Microsoft offering free MDM for all commercial Office 365 subscribers, BlackBerry subscribers will suddenly switch over to their product and abandon BlackBerry in droves. Now that is an extremely big assumption but to be fair lets analyze his article to see whether or not his assumption holds any merit.
Blackberry is teetering currently, with their revenue down 33% YoY, and sales of only 1.6 million devices in the last quarter.
The company is counting on increasing their Mobile Device Management software sales, with their software being able to manage iOS, Android, Blackberry and Windows Phone devices.
Notice here that he begins his article with fear, uncertainty and doubt (FUD), especially with the picture of the sinking ship that accompanies it.
Yes BlackBerry’s revenue is down from a year ago, as are a lot of companies, including competitors Samsung, Sony, HTC and others. But at the same time BlackBerry made a profit for the second consecutive quarter in a row. BlackBerry has also increased its positive cash flow and is no longer burning cash as it was as recently as a year ago.
If you take a look at its cash reserves, it grew by $608 million over the last quarter to $3.27 billion and they made money on the 1.6 million devices that it sold. So yes its revenue was down from a year ago, but its financial position is also in a lot better shape and the company is more viable than it was a year ago.
Now Microsoft has pounded the last nail in the coffin of the company with the release of free MDM for all commercial Office 365 subscribers.
The new feature will allow small businesses to manage Windows Phones, iOS and Android devices and also Windows tablets.
It’s going to take a lot more for Microsoft to even compete with BlackBerry in the MDM market. Today BlackBerry’s BES mobile device management (MDM) software suite controls between 55% to 60% of the MDM market right now. It manages and provides end-to-end security to ios, Android, BlackBerry and Windows phone devices and has more customers than its next 3 biggest competitors ( Airwatch, MobileIron and Good Technology) combined.
The other consideration omitted by the author was that even though there was a decline in BlackBerry’s revenue from devices, it’s software and services revenue increased by 24% over the previous quarter and is slated to contribute a much larger share of its revenue stream in the next quarters.
Microsoft is yet to establish a significant presence in that market. So in my view, the author of this article is way off base in his assumptions that Microsoft’s MDM has the chance to wipe out BlackBerry
The feature will be free to Office 365 Business, Enterprise, EDU and Government customers and will allow them to:
- Conditional access: Set up security policies to ensure that Office 365 corporate email and documents can be accessed only on phones and tablets that are managed by your company and that are compliant with your IT policies.
- Device management: Set and manage security policies, like device level pin lock and jailbreak detection, to help prevent unauthorized users from accessing corporate email and data on a device when it is lost or stolen.
- Selective wipe: Remove Office 365 company data from an employee’s device while leaving their personal data in place.
- A fuller service is available via Microsoft Intune, but the above is more than enough for most small and medium enterprises, and will mean the addressable market for Blackberry’s products has just shrunk a whole lot further.
The feature will roll out to Office 365 subscribers over the next 4-6 weeks, which should be just enough time to sell all your Blackberry shares (down 7% today already).
So notice here, the author lists the features of the Microsoft MDM product, but does no comparison between it and BlackBerry’s BES product. In other words he does not give any compelling reason about Microsoft’s product that will entice BlackBerry’s BES 10/BES12 customers to switch over.
He fails to mention the many certifications that BlackBerry’s BES 10/BES 12 has or its solid reputation in administering and securing enterprise devices from all platforms and how Microsoft can do a better job. Instead he references BlackBerry’s shares that although down 7% on the day that the article was published is up approximately 40% to 50% from what is was a year ago, so more FUD thrown in here.
So the only thing Surur of wmpoweruser.com really achieves in his article is a demonstration of his lack of understanding of the MDM market and the financial position of BlackBerry as a company. Many of BlackBerry’s MDM customers are governments, industries, banks, organizations such as NATO, the US Department of Defense and others for which end-to-end security is an extremely critical requirement. For many of them BlackBerry’s “gold standard” and solid reputation in securing their devices is unmatched by its competitors.
Unfortunately for him, but fortunately for BlackBerry, it will take a lot more than Microsoft offering free software to its Office 365 subscribers to get BlackBerry customers to switch.
In terms of BlackBerry’s financial position, they are on the way to maintaining profitability, increasing growth and achieving their target of an additional $500 million from its software and services division in financial year 2016. It does not sound like a sinking ship to me.