BlackBerry’s gambit for India: Cheaper phones, BES10, messenger & QNX technologies
5 Jan, 2014, 0706 hrs IST, Suman Layak, ET Bureau
Slashing prices and shifting focus from devices to software and services is the beleaguered Research in Motion’s last throwof the dice.
Grammy winner Alicia Keys will not be working to sell BlackBerry 10 phones any more. She quit her association with the company last week. In India too we may forget about the jazzy ads about Black-Berry Boys. There are other ways to sell phones — a price cut is one of them.
Later in January, RIM India Pvt Ltd, the Indian arm of Research in Motion (RIM) that owns the BlackBerry brand, will announcea massive cut in the price ofQ5, its entry-level product on the BB-10 operating system. From around Rs 25,000 the price will come downto below Rs 20,000.
The departure of Keys and a price cut in its prestigious BB-10 device point to a shift in the company — from being device-driven to software and servicesdriven. It is a final throw of the dice for the Canadian company.
Sunil Lalvani, managing director for BlackBerry in India, says that in the quarter ended November 30, RIM got 60% of its revenues from software and services (RIM has a March-February financial year). “Till a year back devices would account for 65% of our revenues and software services only 35%,” he adds.
Keys left exactly a year after she was signed up by BlackBerry to front its pitch with the BB-10 operating system. The BB-10 was touted as RIM’s answer to Apple’s iOS and Android. All that has fallen flat andsales ofBB-10devices did not take off. Neither was the company able to find a buyer — it gave up in November.
AnewCEO, John Chen, a former turnaround veteran at Sybase, has taken over. Chen has chopped and changed his top team and has finalized a different strategy, where devices and phones are just a part of the company’s range of offerings.
Lalvani, who took over as CEO of the Indian arm in June, has survived and is part of Chen’s team now. He points at the $3 billion on the company’s books and explained the new strategy in an interview with ETMagazine.
It is a four-pronged gambit.Thefirst offering is of course the BlackBerry Enterprises Server 10 or BES 10, a mobile device management (MDM) service. It allows companies to allow their employees to bring their own devices (BYOD) to work and connect them securely to the organization’s systems and mail servers.
“BES worked only with BlackBerry. BES 10 works with Apple’s iOS and Android as well and will add Windows within a month or so,” Lalvani says.
Just one of the things the BES 10 can do is remotely wipe official data froman employee’s phone or lock a phonewhen the employee quits or the phone is lost. It can also disable the phone camera during office hours.
While larger customers can install the hardware RIM is also offering a cloud service for small and medium enter prises (SMEs). “India has the second largest population of SMEs after China,” Lalvani says.
The company has met with some success — out of 80,000 installations of BES globally, 2,000 are in India. Prominent customers include Essar Group, Financial Technologies, Indiabulls Delhi, Havells and law firm Nishith Desai.
Rohit Ambosta, chief information security officer at Financial Technologies, feels BES 10 offers it a mix of flexibility and security. “The newest platform has enabled easy segregation of work and personal activities. From an IT perspective the segmentation is so clear that there is no compromise to work security,” he says.
BlackBerry’s messenger service was opened up to Android and Apple devices two months back and saw 40 million downloads in the period. “We will turn this into a revenue driver by launching BBM channels,” says Lalvani indicating that providers will be able to target their content on these channels to specific customers. “Exclusive news updates for CEOs, for example,” suggests Lalvani.
RIM also wants to offer its QNX technologies in India (RIM had acquired QNX in 2010) that allow machines to talk to each other and has applications in healthcare and auto industry. This will be a new revenue line for RIM in emerging markets.
Then of course, there are the phones. Lalvani insists that the price cut is just the beginning ofwhatRIMplans todowith its phones in India.
“We will not compete with the mass market, we will serve a niche that is the power user,” he says. If that sounds typically BlackBerry, here is a glimpse of something more. “The update to our OS — 10.2.2 — will allow users to download many Android apps on to BlackBerry phones,” he says.
Plus there are India-developed India specific apps — Havells’ sales force uses one such app. BlackBerry is clearly betting on multiple horses to stay in the race.