BlackBerry might be broken up into two parts: OS and patents

Ian Hardy

September 13, 2013 9:13 pm

BlackBerry has “narrowed its list of potential bidders” and reportedly pushing for a quick sale – potentially as early as November. Rumours around the web are that private equity firm Fairfax Financial Holdings, which owns a 10% stake in the business, is interested in scooping up BlackBerry. In addition, Microsoft is ‘keeping an eye’ on what the Waterloo-based manufacturer is up to.

For several years many investors have been pushing BlackBerry to be split up into several parts: network, device and patents. Unfortunately, something of this nature just might happen.

According to a report in Reuters, several unknown bidders have signed confidentiality agreements and are looking into ways to break the company up into two parts – operating system (BlackBerry 10 and the network assets) and its vast collection of patents, specifically highlighting its keyboard. Possibly vanishing from the plan is its hardware production. However, there is a glimmer of hope as the report states there might be interest from “a Canadian pension fund to team up with an investor to buy the whole company, which is currently worth a little more than $5 billion.”

Reuters notes that “According to analysts, BlackBerry’s assets include a shrinking, yet well-regarded services business that powers its security-focused messaging system, worth $3 billion to $4.5 billion; a collection of patents that could be worth $2 billion to $3 billion; and $3.1 billion in cash and investments. Even at a conservative estimate, that is more than the company’s $5.4 billion market value. Analysts said the smartphones that bear its name have little or no value and it might cost $2 billion to shut the unit that makes them.”

BlackBerry clearly declined to comment the speculation. In the near future, BlackBerry is focussed on delivering BBM to iPhone and Android users, plus planning to launch the 5-inch BlackBerry Z30 in the coming weeks.

Source: Reuters
Via: TNW

  • JB

    Fairfax….its going private. The rest is static.

    • G-man

      +10

    • badtaco

      And no more handsets!!!!!!!!
      Finally!

    • JB

      Its really weird you made like 6 separate email accounts to push your anti blackberry view…..on a friday…….jesus lol.

      Sad stuff

  • KID ANDROID

    They have to release the Z30 first , I want one so bad. I love the BB10 OS and its the most well thought out and innovative OS available. It sucks so many ppl badmouth BlackBerry without ever even giving the new OS a real chance. BlackBerry really screwed up letting the old OS last so long it killed the brand. If the amazing OS cant regain the publics intrest as amazing as it is then nothing will unfortunately.

    • JB

      Yeah their new phones are outstanding.

      Spread the word. They need to market better. A new board will help with that.

    • Eduardo

      While I agree the OS is pretty good, I think it has a major flaw (at least until now), and it’s that it needs bezels. Phones are getting thinner and thinner but bb can’t follow the trend with the way BB10 works right now. Like you said, they kept bb7 (6?) for far too long plus they failed to deliver a decent tablet which led to a failure to entice developers… No matter how much you market the the OS, if you don’t have the apps to back it up, it won’t work. It’s sad to say but they ran out of time.

    • PT

      Couldn’d have agreed more.

    • Bri

      But what would it mean to the user when the company goes down? When the company can no longer provide services to its customers? That’s holding me from buying a bb device

    • Sweet

      My understanding is that the new BB10 devices don’t need to use the BB Internet Service servers as the BB7 devices did. So if they shutdown that service, you would be able to continue using your device as you currently do. If they shutdown BBM, then you would obviously not be able to use BBM.

      The other issue is the warranty. Currently, the BB warranty policy states that you have to get the warranty service from the place where you bought the phone. But I don’t know if that retailer sends it to BB to fix or not.

  • Sweet

    That split doesn’t make sense. It means that BB software and services go into one company, but the patents that those software and services use will go into another company. It make more sense to me to group the patents with the parts of BB that use those patents. I would break BB into the following:

    – BBM
    – network and services
    – devices and device platforms

    • Chris Lau

      Or BB could be the parent patent company that licenses to those 3 divisions.

    • thedosbox

      It makes perfect sense for a patent troll – see the new Nokia. An independent PatentCo could go after their targets without worrying about reverse litigation targeting BB’s services business.

  • howitzerr

    Motorolas made in waterloo would be cool

  • Rich

    Really need to go private so it’s not as easy for people to troll everything they say or do. Additionally, it would also mean they wouldn’t have to lay off so many employees to balance the books for shareholders. When you’re playing catch up you really want as much freedom as possible.

    • G-man

      True dat^^^!!!

    • Fuzzyfish6

      The problem is that these small players (Fairfax) will exhaust the majority of their solicited cash in the purchase and won’t necessarily have enough resources left to actually do something with it. Should be interesting.

    • JB

      Fairfax a small player!?….lmfao.

    • Fuzzyfish6

      Yes small, with annual income averaging 500 million, and 90% of their assets locked down. They’d have to focus every last cent towards the effort, and there’s no one around to pull off a Steve Jobs.

    • J-Ro

      When buying BB, they would have access to the billions they have in cash. Going private would allow them to outsource to save money and not get as much attention for doing so.

      At that point, they should focus on maximizing enterprise accounts and getting their devices in meida (tv shows, movies, etc) for consumer exposure.

      I’m no expert but that seems like a good plan for them to get at least 3rd place back in the smartphone race.

  • Chris Lau

    Right now BB is a clear takeover play, but I really wish the company would clean up its advertising division. Fire Alicia keys and show off: Skype, WhatsApp, BBM (what BB has and what others won’t have), and finally….Real Racing 3 by EA. FREE game and a lot of fun. Been playing it on Z10.

    • badtaco

      Too late.

    • Dave Grant

      Why is showing off Skype and WhatsApp and a free racing game a good advertising strategy? All the other major platforms have these things.

      They need to show off the elements of BB that are both unique and important to consumers. I’m not sure such elements exist (although, I’ve never used a BB).

    • Chris Lau

      Ok, then capitalize on the big NSA fiasco. Advertise about Security. Even iPhone 5S is being teased at as being a fingerprint collection agency for the NSA.

    • Jay

      Look at how many iPhone users there are out there. Sadly, most people just want to see BB being the same as everyone else. BB first needs to show people they are just as good as everything else. Then they need to show off all they can do that nobody else can!

    • Fuzzyfish6

      Ugh, yea. Lol

    • 01011001001

      Even the best marketing efforts can’t save BB. The fact is no one wants it except for those hardcore kb users.

    • Sweet

      Don’t forget those who need the best security too. There are other reasons why people would want to choose BB, namely Peek, Hub and Flow. However, BB rarely shows those features and is preferring to rely on branding to sell BB10 devices, which IMO, is a mistake. They don’t have the brand power they used to have, so they now have to start talking about features and showing people how their BB10 devices are better than their competitors’.

    • J-Ro

      Do not be so naive. There isn’t a thing that good marketing can’t do. Lest we forget the movie “Super size me”. Good marketing is what made McDonalds not see a dent in its sales and growth.

    • 01011001001

      So if marketing is the problem then it should be a simple fix right? Hire the best ad agency and throw money at it.

      The truth is even be management doesn’t believe throwing good money after bad will get consumers to buy either the z or the q10.

      They had about 3b in the bank, don’t you think even spending 25% of that in marketing would’ve done to sales of bb10 devices if they figured that marketing was the solution?

    • J-Ro

      Marketing is always the solution. No one knows what BB10 is capable of. No one knows how easy it is to use, no one knows that is has some of the flexibility of Android and no knows that it gets updates faster because they come straight from BBRY.

      They hired Alicia Keys to push the phone, which made no sense. Their previous commercials showed very little of what the phone can do and more of some genie and a guy in an airport.

      When I think of those things, I realize that marketing is absolutely the problem. Yes, they have 3B but even with 30B in the bank, Without a solid marketing plan, you are just pissing money away.

  • badtaco

    Na na nah-nah, na na nah-nah, hey hey hey, goodbye!

    • thedosbox

      Never owned a blackberry, but even I acknowledge that without BB, the smartphone industry as we know it today wouldn’t exist.
      But hey, don’t let that stop the clueless haters.

    • 01011001001

      Yes true, that’s why apple decided to step in and change it for the better.

    • Jay

      Let’s release a phone that’s like a computer! It will be revolutionary! But then, let’s not really change it for the next 6 years unless someone else does something amazing first! Then, we’ll steal it, use it in our phone and then sue the pants off of the creator of the tech and make a boat load of money!!!

    • youajew

      You mad bro?

    • Jay

      Not usually. I just can’t stand people like 01011001001 that imply the iPhone is better without anything to back it up.

    • 01011001001

      If it weren’t for the iPhone we’d all still be stuck using Blackberries, no apps, can’t browse the Web etc.

      Back it up? Isn’t iPhone sales are proof that it is a better platform than bb then and now?

    • Sweet

      Popularity does not necessarily mean higher quality. Talking to iPhone owners, there are two reasons why people buy iPhones:

      1. app store
      2. branding

      IMO, build quality is a good reason to buy an iPhone too.

      BB10 (the software, not the hardware) is better than iOS in every way except (off the top of my head) wireless streaming, electronic wallet and ad platform. Keep in mind, that is based on my experience with iOS 6, since I haven’t had the chance to try iOS 7 yet.

      Now, having said all that, I agree with you that Apple did change the industry for the better.

    • thedosbox

      If it weren’t for BB, apple would be just another company selling mp3 players and desktops nobody cares about.

    • 01011001001

      where’s your head at? Apple does sell mp3 players – remember the iPod? That’s what enabled or turning point in Apple to where it is today, w/o the iPod there would be no iPhone or iPads.

    • schemata

      While I admit that Blackberry was a pioneer in this field, I don’t think it’s safe to assume that the industry as it exists today would be so much different.

  • Bbrysuckz

    Haha BlackBerry.

  • Julis

    Adios!!!

  • Fuzzyfish6

    Too much toxicity at every turn for this sorry heap. Prem watsa is gonna have to do the work of the pope if he thinks he can turn anything around. Lol.

  • warcaster

    I hope someone like Google gets their elliptic curve cryptography patents, and then makes them public domain. They are going to be VERY needed as we move off RSA, and a company like Microsoft would just hoard them for themselves, and troll everyone who uses them. It would be very unfortunate for the security industry if that happened.

  • beyond

    the creation of jam begins by breaking apart the fruit

    • badtaco

      Same goes for ketchup. But don’t tell heins that. Ha ha.

  • PT

    Only the patents and hardwares that counts. Nobody care about the OS. This has been
    proven. Wake up people!

    • Sweet

      Nobody (that is to say, other companies) cares about the hardware biz. It’s the patents, network & services, BBM and some of the features of BB10 that they’re most interested in.

  • southerndinner

    BB10 is garbage and no amount of BBRY employees posting fake reviews will change that.

    • rd0t

      You must need a button to tell you where home is. iPhone user?

  • Sweet

    That’s what I was thinking too.

  • bobF

    iohu

  • Michael Todd

    Buy buy blackbearry Android rules

  • 01011001001

    Research what exactly? I own more phones than you and that includes the z and the q10. I buy a phone every month because I can so I’ve done my research.

  • amanda32

    I’m sending my prayer and thanks to pastor Humen for his prayer and love spell that he did for my last week and i never thought i will ever seeing my husband again after he left me and my kid for almost 3years, and last week i wrote to pastor humen on email: humenhealingtemple@yahoo.com and i told him all my problem he call me on phone gave me all the advice that i need and also told me what i need to do and after which i received a call from my husband and told me that he was going to come and visit me and my kid and now the most important thing now that is making me happy is that we are back together again all thanks to pastor humen