BlackBerry's hopes of a government bail-out found to be fruitless

Aug 23, 2013

Yesterday, Canada's Minister of Industry, James Moore, stated, "This [BlackBerry] is a Canadian company with a long track record of stirring-up innovation and important changes in the products we all use. They employ a great number of Canadians and it's been a source of Canadian pride and we hope that they do well. It's having a herd time right now but it's for them to engage the market and provide devices and services, platforms, content that the market will receive well."

He continued, "I know that they're facing their challenges and they're adjusting their firm internally in the way that best suits their interests and all I can say is, we wish them well, and we're keeping a close eye on the situation."

In other words, Canadian government policy that BlackBerry won't get a bail-out from tax-payers money... unless, that is, any potential purchaser turns out to be a foreign company. That circumstance, where national security may well be cited as an issue, would invoke an automatic government enquiry. PC manufacturer Lenovo of China has already expressed an interest in acquiring BlackBerry and other overseas enterprises are considering their options, so, despite its evident reluctance to intervene to save a once great Canadian company, the government may yet be forced to act.

BlackBerry put itself on the market after its last best-hopes, the BB10 OS and new handsets running the new software, failed to catch the public imagination or sell in sufficient numbers to save the company.

BlackBerry's seemingly endless decline has been hard to watch. Its handsets, once the muct-have devices of yuppies and big business the world over are now regarded by most consumers as old-fashioned has-beens. The market agrees. BlackBerry’s dwindling assets do include a patent portfolio worth some around US$1.6 billion but this is small change in today's world. To put that patent value into perspective it should be remembered that only a couple of years ago Google paid $12.5 billion for Motorola's mobile telephony business.

Even as the walls have collapsed around him, BlackBerry's cock-eyed optimist of a CEO, Thorsten Heins, has remained relentlessly upbeat (at least in public) and never passes-up on a opportunity to eulogise and evangelise the company.

Recently he was boasting about the huge number of apps that are available in the garden of earthly delights that is BlackBerry World - over 127,000 of them, apparently. What he failed to add is that more than 47,000 of them are the work of one development unit in Hong Kong!

The snappily named S4BB, is churning out apps for the BlackBerry 10 OS on an industrial scale and many of them are, in essence, little more than spam and consist of recycled city guides, audiobooks and an embarrassment of lightly repackaged RSS feeds.

On the BerryReview website, editor Ronen Halevy writes, "These apps are actually borderline legitimate apps though they are really stretching the definition of what an 'app' is. They offer different content in a similar wrapper. I actually wonder how many of these 47,000 apps have ever been purchased or downloaded."

Well, yes, that is indeed the $64,000 Question

The revelations, that about one third of all BlackBerry apps comes from one small Far Eastern development house and that many of those self-same apps are of minimal appeal or value to users, drives a coach-and -horses through BlackBerry's much-vaunted and oft-trumpeted claim to have 120,000 relevant, useful and different apps in its stable.

Meanwhile, it has emerged in a US securities filing that in the event that BlackBerry is sold or he is ousted, CEO Thorsten Heins will get a payoff of some $55.6 million.

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