BlackBerry sets deadline for smartphone turnaround

BlackBerry has given itself the remainder of the current fiscal year, which ends next March, to return its handset division to profitability, CEO John Chen said during the company’s annual general meeting.

Chen said that while he would like to see BlackBerry remain in the handset business, there will be significant challenges along the way. Meanwhile, the company plans to continue focusing on its software division, particularly the enterprise mobile management, enterprise, secure communications, and technology solutions markets, with an aim for 30 per cent growth, he said.

“I do not personally believe that devices are going to be the future for any company,” Chen said. “It’s like PCs today, or servers today. I think that it is what’s on the devices… that’s going to be the future.”

Though he focused on BlackBerry’s software division throughout the AGM, Chen also repeatedly emphasized the company’s commitment to remaining in the hardware market.

“Our number one objective this year is we need to get the device business profitable,” he said. “We don’t want a business that drags on the bottom line.”

While it became known for its iconic handsets at the turn of the century, today BlackBerry’s goal is to deliver a secure end-to-end mobile solution for large businesses and governments across the world, Chen said, noting that his company presently controls nearly 20 per cent of the enterprise mobile management market, which combined with the enterprise, secure communications, and technology solutions markets is expected to be worth approximately $17.6 billion by 2019.

The company’s most recent handset, the Android-powered Priv, was emblematic of its new approach, Chen said, combining the best of Google’s mobile platform with the finest security software BlackBerry can offer.

“We recognize that to grow our business, we have to grow on many devices,” he said. “BlackBerry’s heritage is security, and I think the world needs a secure Android, so we’re going to build the most secure Android phone the world can see.”

Chen admitted that BlackBerry’s goal for its software division is a lofty one, with the market in general currently growing by an annual rate of only 15 per cent, but seemed confident that the company could rise to the challenge as he mentioned such ventures as a new platform for autonomous vehicles, cybersecurity consulting services, and the integration of its enterprise solutions with Microsoft Corp.’s cloud platform, Azure. The company is also developing a new tablet for government use, the SecuTablet, which is currently being used by the German army.

“We obviously look at the world now, and it is no longer about handsets,” Chen said. “The world has moved on. The future of this global footprint is going to be connected.”

Chen also took a moment to address BlackBerry’s finances, emphasizing that the company is no longer in the red and has invested nearly $1 billion into future projects over the past 18 months.

“If you look at any analyst’s report about us, it’s bad,” he acknowledged. “Anything BlackBeryy does is bad. If we stood on the street and handed out money, it would be bad.”

However, he said, the company has been recognized as a mobile enterprise services industry leader by consulting firms Forrester and Gartner, and looks forward to revealing its first-quarter fiscal 2017 results on June 23.

During the meeting a shareholder repeatedly interrupted Chen, reportedly attempting to ask about executive compensation, according to BNN reporter Paige Ellis.

John Chen is the highest-paid CEO in Canada, according to the most recent rankings by Canadian Business, receiving more than $89.7 million in 2014, the most recent year for which data is available.

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Jim Love, Chief Content Officer, IT World Canada

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Eric Emin Wood
Eric Emin Wood
Former IT World Canada associate editor turned consultant with public relations firm Porter Novelli. When not writing for the tech industry enjoys photography, movies, travelling, the Oxford comma, and will talk your ear off about animation if you give him an opening.

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