Smartphones are still important to BlackBerry

JC KitchenerBlackBerry chief executive officer John Chen sat down with Ian McLean, president of the Greater Kitchener Waterloo Chamber of Commerce, at a luncheon that attracted about 400 people to the Bingemans conference centre, and stated that smartphones are still important to the company.

Ironically, Chen said that the biggest challenge in BlackBerry’s turnaround is not convincing customers, but convincing employees that smartphones are part of the solution and not the only answer to the company’s turnaround.

“Structurally and psychologically and mentality-wise we are still a handset company,”

“Handsets are important. This is not a binary yes or no, but we’ve got to make handsets part of the solution, not the only solution,” he said.

BlackBerry is financially stable and generating cash, but it needs growth before investors and consumers to believe in the company again, Chen said.

A critical area for that growth, Chen said, is software and services related to the 10 billion endpoints in the Internet of Things, including medical devices, vehicles, machines and home appliances.

The other major challenge for the turnaround is that the company’s reputation has suffered a lot in the past three years, and that makes it hard to make new sales, Chen said.

“But that is true for every turnaround, and that can be solved,” he said. “I need an inside-mentality change, and then everything else will fall into place.”

Chen made it clear that software, services and security are critical to the future prosperity of the company.

“We are going to make more on software and value-added know-how across every ecosystem, including peoples’ phones,” Chen said.

“We need to tell people BlackBerry not only has a strategy, but it is no longer in trouble. and the sooner that message gets out and registers, the sooner we will return to growth.”

BlackBerry is working on new phones that will be released later this year because handsets can still be good business. But they can no longer be the company’s main focus, Chen said. The cost structure of the handset business has to change, he said.

“I mean this whole cost structure is really huge,” Chen said.

“We are working really hard on that. We have to be sure we make money, otherwise we can’t stay in the device business. But I am hopeful we will be able to do it.”