Our friend Badi from Malaysia thought long and hard… and posted something that’s incredible in my eyes and I think it needs to be spread for people to be informed..
It’s rather long but it’s a great read!
Badi wrote in our forums:
“You’re getting it wrong.
Some people think that a CEO for BlackBerry must have very grandiouse plans of regenerating the company, to bring it from zero to hero in means that are just plain ridiculous (like needs more advertising campaign, we must outdo Samsung! bla bla bla) rhetorics.
IF you have (emphasis on IF) even bothered to listen to the earnings call, and also tune in to the CBC’s Amanda Lang’s interview with John Chen, you should have at least got a really big picture of what is going to happen, what will they be attempting and what they are doing things at the moment.
The What, Why, Where, When, Who and How has been asnwered. It is up to you to piece the pieces together, dear readers. However, if you cannot agree, that is your right and prerogative. However, if you don’t like what John Chen is doing, then you go and step into his job and his shoe.
There are a lot of materials dig-able from the earnings call, but I don’t have a recording of that so I’ll be dissecting whatever bit that is from the CBC interview.
John Chen’s first priority is… “to make money”. Now in case you don’t get it, let me repeat.
“to make money”.
John Chen has to make money, and make money fast. Making money involves a lot of things, such as trimming, changing, making full use of assets, etc.
1a. Renegotiating one of the Bold lines so that its going to be another production run, and making sure that BlackBerry is profitable with that run. That is one example of making money. Why? Because people still want to buy Bold devices. Love it or hate it, (I don’t want a BlackBerry 7.1 device, please), if there is easy money to be made over that, by all means John Chen will do it.
1b. Just for your perusal, you don’t expect a great deal of people to jump devices from one device to another every 2-3 months. There are people who do that, but many others don’t. Many keep their phones for 1, maybe 2, sometimes 3 or 4 years, or more. There are many short term users, there are many long term users.
There are about 60million subscribers, give or take. And with whatever number is left (new users or old), you can expect some people to hang in there for another 1 year, maximum. Subscribers are those who are on BIS. BES subscribers are on different count (please correct me if i’m wrong), and 60 million subcribers is still a lot of money. But we’ll get to this more later. What I want to emphasize is this number.
The way I see this Bold production re-run issue is that BlackBerry hasn’t properly been able to gauge the newer low end BB10 experience on the Z3 model, or the up and coming Q20 Classic experience. Without any certainty, BlackBerry fell back to what is familiar: Get the Bold production re-run 1 more round because there is a demand, and its easy money. At least 1 year into the BIS subscription. Not much, but it is still money. Until they have a better data to fine tune their devices.
1c. Whatever else that makes quick money, he’ll do it.
Secondly, John Chen has highlighted the need to convert the existing user base to upgraded models that will benefit BlackBerry. Wait, what? Isn’t it as easy as making, designing and shipping newer BlackBerry 10 devices? The answer is no.
BlackBerry 10 devices, the OS is fantastic. But it may not yield the numbers needed for a mass conversion. Some people tend to forget that BlackBerry (or RIM back then) was first a caterer to enterprises FIRST, consumer next. It was just by chance they served the consumer market, but they NEVER REALLY did serve the consumer market. It just happened that consumers did like what BlackBerry had until Apple came along with iPhone.
But what am I getting at here? I can draw many parallel analogies, but it is sufficient to say that you can have the best device but enterprises are not exactly going to just upgrade overnight. Again, there are a lot of parallels that I can draw to, device and software wise. What we all need to understand is that there must be a means to allow very quick / rapid adoptions of new technology, or upgrades to that existing technology.
If you are on the same page with me, then you will notice 2 things that makes enterprises move (despite it being ultra slow, for many enterprises)
a) price per software/hardware
b) cost per maintenance.
c) ease of use
d) is the upgrade worth it?
Because this is capitalism. Money talks. Cost talks.
Just like BlackBerry is a service provider in communication technology, its clients are also service providers in goods or services. Therefore the issue of cost effectiveness and cost aggregates becomes a very strong considering factor.
By now, it should have dawned upon you, dear readers that if you have some sort of say in finances in your respective institutions, and being held accountable for it, then you will know that point A and point B becomes very urgent and important.
Is BES5 and below BlackBerry 10 ready? (No.)
Is BES10 BlackBerry legacy devices ready? (No.)
Is BES10 cross platform ready? To a certain extent, (yes.)
Is BES10 a pure MDM solution? To a certain extent, (yes.)
Is BES10 small and medium business BYOD friendly? (No, not yet).
Immediately, you can see the glaring flaw, and remember, John Chen needs to make money. So how can he make more money? Easy. Consolidate everything into one, and make it easy for customers.
Hence BES 12. Go and read up about BES 12, and then come back if you think that it won’t make money for BlackBerry. Of course it would, and it would also make money from DEVICES that are not BlackBerry related. No other company has the vertical and horizontal approach that BlackBerry is adopting, with exception of Microsoft and to a certan extent Google. (or Google, and Microsoft to a certain extent) when it comes to what BlackBerry wants to do.
Is BlackBerry concerned about what Office suite you are using? (no)
Is BlackBerry concerned about what OS you’re using on your computer? (no)
Is BlackBerry concerned about how communication happens in a company? (with great interest)
and that is where you see why BlackBerry is going into that direction. They see what companies want in their communication, and try to cater to that need.
So, back to the question about upgrading the existing base, in BlackBerry’s case more than the factors above mentioned, to some people jumping in from BlackBerry legacy to BlackBerry 10 is like learning a brand new OS, a brand new way. Just like you can drive a Toyota Sedan on a petrol engine with full auto diphtronic semi auto gearbox and a Toyota truck in a diesel engine with full manual transmission with full selection of 2W,4W,FD or RD configuration in manual. Its still Toyota but the way it drives, the way you operate it is fundamentally different. But you still have ignition key, you still have the air conditioner, you still have stereo, you still have a spare tyre, you still have doors, you still have seats. But it is a different experience.
So what do you expect BlackBerry or in the case of the sedan and hilux comparison above?
You help consumers to transition.
And in the case of BlackBerry, the feedback came from their prosumers who are in the industry. It is only logical to listen to the customers that pay the best money to you, right?
In the debate of whether the toolbelt should come back or not, it is not for me nor you to decide based on preferences. It is fundamentally up to BlackBerry to decide on whose money to make and whose to lose. For BlackBerry, they can afford to lose the customer of any average Joe who buys a device and that’s it, but it’ll be a very bitter pill for BlackBerry to swallow if they lose their enterprise customers who simply pay more good money to BlackBerry.
Because lets’ face it. Prosumers on BES pays more good money than an average Joe on whatever BlackBerry devices, BIS or not. The more they can maintain the BES customers, the better. So in the case of BlackBerry, if they lose customers who upgraded their BlackBerry devices to iPhones and Android, should they be worried?
But if the same customers migrate from BES to another MDM solution, will BlackBerry be concerned?
All alarms will ring.
Because making phones and selling them expecting customers to upgrade every 1-2 years is absolutely absurb. Even the supposedly almost infallible Apple has felt the heat for trying to maintain such an unreasonable approach to business. If you don’t get what I mean, go and google ASYMCO, because he devotes a lot of his attention to the mobile world in terms of finances, and he will give you a great picture of what is going at Apple, quarter by quarter, year by year.
Because devices sell, but they are one time. Services sell, and you reap the money every month as long as the customer is happy. Just like your telco.
Be my guest and try to identify which one is the lower hanging fruit? To go and entrench your base, or try to woo new customers?
That’s right. It all comes to “make money”. Fast, easy, quick returns, quick investment, long term, short term. Whatever John Chen can do, he will.
So all the talks about enterprise, why isn’t BlackBerry chasing the small and medium sized entreprenuers? its simple:
its a gamble game. BYOD or no BYOD, small and medium enterprises cannot be expected to apply big enterprises’s perspective in maintaining communication patterns nor to exercise them. It is just not cost efficient at all. But is BlackBerry equipped for these companies? Not yet, at least not until BES 12. But has BlackBerry the know hows to enable them to service these customers? Yes.
Because they did not do BIS for nothing. It was and always was a way to make money and also gauge how people wanted / needed such a system of delivery of data connectivity.
But why all that seemingly headless move?
Because it wasn’t headless. It was to make money. Money makes BlackBerry go around the world.
And you think you have grandiose plans that would work in 1 single swipe?”
I’d say it’s best to leave your comments on his thread instead of here….