We all know $BBRY to be a stupid company who lost the phone wars to $AAPL, ceding the dominant position in mobile by stubbornly sticking to its retarded keyboard phone. But in recent years the company has been switching its core focus away from hardware and to its very good secure software technology.
Today they announced their messaging technology will open up to 3rd party developers — competing with the likes of $TWLO.
Software sales are expected to increase by nearly 30% this year — not including the business they intend to steal from TWLO.
Source: Bloomberg
BlackBerry Ltd. is opening up some of its secure messaging and file sharing technology for developers to use in building apps, creating a new revenue stream for the company as it works to boost sales.
The Waterloo, Ontario-based company said the software development kit it’s releasing this month will include tools for building chat apps, video and voice calling, secure file sharing and sending out push notifications to mobile phones. BlackBerry joins a crew of companies already offering similar services including Twilio Inc., Bandwidth.com Inc., Nexmo Inc. and Plivo.
The key differentiator for BlackBerry though, will be its reputation for security, Chief Operating Officer Marty Beard said on a call. “We don’t think current providers are meeting the needs of the enterprise,” he said. “The market needs this.”
The move is a textbook example of Chief Executive Officer John Chen’s strategy of taking the company’s existing technology and finding new ways to monetize it. Instead of the closed, device-focused BlackBerry that Chen inherited three years ago, the company now licenses its software and gives permission to other companies to make phones with the BlackBerry brand.
Beard declined to comment on how much revenue the company was expecting to generate from this initiative, but said it would “add to growth.” It will be sold on a subscription basis to app developers and internet service providers.
Device revenue now accounts for less than half of BlackBerry’s profits and is falling, but sales of software that Chen acquired and built out in recent years is picking up the slack. The company expects software revenue to be $640 million in the fiscal year ending March, compared with $494 million in the previous year, Chen said in December.
Ultimately, TWLO is a Fred Wilson company and destined to fail. Although BBRY is a Canadian based company run by leaves, I believe they will make some headway into the messaging business — due to brand recognition. People are into retro now and love sentimentality. It’s very likely that TWLO is about to suffer a significant drawdown due to this new, formidable, competitor.
Shares of TWLO are down a smidge, hardly the type of trading action of a worried shareholder base. BBRY’s stock is exactly flat over the past year — marking time as the business transitions.
If you enjoy the content at iBankCoin, please follow us on Twitter
I’ll never forget Karl Denninger saying FB and NFLX were zero’s, and to go long Blackberry. That cost me an ungodly amount of money.
He bankrupted himself a few years back I bet. Only explanation for his crazy posts.
Wanna be hipster stocks.
Fly, you still got 4 months to ditch that dad bod before summer rolls around.
I don’t want you to be that guy anymore wearing a t-shirt in the pool when you’re swimming w/ your kids.
Clean up that diet.
Not me Wiggles. I’ve been fit for years, at the gym regularly.
Make it free, make it affordable, people will come and use it. Blackberry used to be the best in secure communication. And that was also their down-fall. NSA and the fed alphabet could not monitor their communication, so …and you know the rest.
So…do we like it here in the $7-8 range?
Or not?
I think security is a the top concern when Twlo does a sale and an issue for them. Bbry has a competitive advantage there and will win some Twlo business, imo. And it’s a much smaller market cap. I think it’s a buy here. It’s all about security and Bbry wins
At $7 they’re still 2x TWLO’s market cap.