Security cloud as BlackBerry moves on

As BlackBerry continues to decline, what’s the future of the once dominant mobile vendor in the Australian market?

The Android-powered PRIV by BlackBerry

As BlackBerry continues to decline, what’s the future of the once dominant mobile handset vendor in the Australian market? It’s easy to describe BlackBerry’s recent history as being rocky, but in truth the company’s decline has been a smooth, steady regression as it went from selling one in five smartphones in 2009 to less than half of 1 per cent last year.

For Australia’s dwindling band of BlackBerry loyalists, that decline has been felt sharply as large organisations shifted away from the platform, and local telcos steadily reduced the company’s handsets and the services they offer.

The launch of the Android-based PRIV handset late last year illustrated BlackBerry’s dilemma: despite reasonable reviews, the device met widespread market indifference. In fact, that’s been the state of play for BlackBerry phones for some time now. The shift to Android wasn’t surprising given the dominance of the two major smartphone operating systems and Telsyte senior analyst Rodney Gedda sees the move being good for BlackBerry, even as building phones becomes a marginal segment of the overall business.

“BlackBerry is undergoing significant change and its handset business, while in decline, is still relevant to many Australian organisations,” he tells The Australian. “Its adoption of Android as a smartphone platform is a positive step for the company, but still presents challenges in terms of differentiation and adoption.”

Differentiating the BlackBerry offering from the mass of Android smartphones is its emphasis on privacy and security, using the software services acquired by the company over the past two years. The bet being made by BlackBerry’s chief executive John Chen is that the company’s core markets — enterprises and government agencies — will value secure systems.

In Mr Chen’s view, BlackBerry’s future lies in its roots of providing secure communications for large organisations. At the company’s 2014 security summit in New York he said: “It became obvious to us that security, productivity and collaboration have to be it. That is not to say we are not interested in the consumer, but we have to anchor ourselves around the enterprise.”

A year later Mr Chen reiterated that point.

“I have said many times that BlackBerry would not release an Android smartphone unless we could make it private and secure. I’m pleased to say that day has arrived,” he said at the PRIV’s launch last October. “With BlackBerry’s patented keyboard and the full complement of applications found in Google Play, this device expands our cross-platform strategy and gives end users the best in security, privacy and productivity, with no compromises on applications.”

That shift to security is the main game now for BlackBerry in the Australian market, says Telsyte’s Gedda. “BlackBerry’s future lies beyond handsets. Even if the company eventually exited the handset market here, its software and services offerings are growing in relevance, so it’s not all doom and gloom.”

For the local market, the company sees its existing foothold in these sectors as being a key advantage, as Matthew Ball, the company’s Australia and New Zealand managing director describes. “BlackBerry is the trusted partner for the world’s most formidable businesses and governments, managing and securing mobility platforms, regardless of what devices people use,” Mr Ball tells The Australian.

Mr Ball is also not ready to give away the smartphone market yet. “We also continue to have a strong global presence in smartphones, recently announcing that all seven carriers in North America will launch the Android-powered PRIV by BlackBerry,” he says. “In Australia, we are excited to share that we are making the PRIV available to Optus customers very soon. Pricing and availability will be announced by Optus this week.”

The corporate security sector though is the main focus, “Australia is a key enterprise market for BlackBerry globally,” Ball says.

Telsyte’s Gedda agrees with this view. “It’s definitely the right strategy to open up the platform and support as many devices as possible,” he says. “The acquisition of Good Technology will also boost BlackBerry’s MDM/MAM market position. All signs are that BlackBerry is on the up with its enterprise software strategy and the next step for MDM in general is more cloud-based delivery to meet customer demand.”

BlackBerry’s Ball sees that security aspect as key to the company’s local success. “The vision we’re working towards is one where any Australian business or department can embrace innovations that enable the best mobile environment, without concern that decisions will compromise the security of data.

“These latest developments all build on the trust we’ve built in the industry that enable governments and businesses to manage data security.”