BlackBerry's flagship Passport may have an Android-powered option. Source: BlackBerry.
Unless youve been living under a rock, you know BlackBerry is no longer as popular as it once was. The company, then Research In Motion, and its now-eponymous device, essentially defined the smartphone product category after the Canadian technology company shrewdly added email functionality to a mobile phone. At one point, its devices were deemed so addictive that fans jokingly renamed the device a CrackBerry.
Unfortunately for investors, and at the expense of perhaps overstretching the aforementioned CrackBerry analogy, the habit has been rather easy for most former addicts to kick. After rising as high as $150 on a per-share basis, the company now sits near $7 per share, as the companys smartphones have fallen out of favor, and demand cratered. While BlackBerry was intensely focused on physical keyboards, competitors like the iPhone and Google Androids were more focused on improving their ecosystems and experiences, treating the phone as a mobile gateway to the Internet.
By the time BlackBerry realized consumers favored Apple's and Googles approaches, it was essentially too late. Developing an ecosystem is somewhat like a chicken versus egg problem: On one hand, a top-notch ecosystem is dependent on third-party developers, who will not make apps and games for your devices unless you have significant users. However, you will not acquire significant users until you have that top-notch ecosystem.
BlackBerrys newest move, however, has the potential to negate its ecosystem deficiency.
The rumors appear to be true Earlier this year, heads turned when the rumor mill started buzzing about a potential Samsung BlackBerry unit. The rumors made sense, as they pointed toward a partnership that stressed specialization of what each participant did well -- BlackBerrys secure services, specifically BlackBerry Messenger, on a unit manufactured by Samsung. But perhaps the biggest disclosure was the fact that BlackBerry would use Googles Android operating system instead of its fledgling BlackBerry 10 system.
Meet BlackBerry's new Venice model. Source: @evleaks/Twitter.
According to in-the-know technology journalist Evan Blass, BlackBerrys next handset -- the BlackBerry Venice -- will be an Android-powered unit, although Samsungs involvement was unknown at the time of this writing.
However, an additional leak from Blass appears to show BlackBerrys current flagship, the Passport, running Android, as well. If so, this could signify more than just a partnership between Google and BlackBerry, and more of a whole-scale migration to Googles Android OS.
If BlackBerrys handset business is worthless, this makes sense As far as BlackBerrys concerned, the hardware business has been valued as worthless from analysts; scaling back investment in its ecosystem, and replacing it with the most-popular one, is a win-win for all parties. Consumers will have a better experience, BlackBerry saves research and development money, and Google brings more participants to its host of mobile services.
For BlackBerry, this appears to be in line with Chens turnaround vision, widely considered a software guy from his turnaround job at Sybase. After years of BlackBerrys revenue mix being dominated by hardware (read: smartphones), last fiscal year, the companys service and software eclipsed hardware for the bulk of sales.
In BlackBerrys recently-reported first fiscal quarter, its software and technology licensing revenue increased 150% over last years total due to technology licensing (not smartphone software). Right now, it makes more sense to concentrate on technology licensing, and probably should fully transition to Android on all its phones.
The article Will Android-Powered BlackBerry Venice Save the Company? originally appeared on Fool.com.
Jamal Carnette has no position in any stocks mentioned. The Motley Fool owns and recommends Google (A shares) and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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