BlackBerry Updates: New Smartphone Launches, Automotive Security
BlackBerry has had an interesting couple of weeks, following its surprise $815 million arbitration award from Qualcomm in mid-April. The company’s hardware partners have lined up new smartphone launches, while there have been reports that the firm will enter the automotive security space. The stock has also fared reasonably well, breaching the $10 level for the first time in close to two years, driven by the award as well as the recent ransomware attacks on PCs, which have brought focus back onto cyber security, which remains one of BlackBerry’s core competencies. In this note, we take a look at some of the recent developments for BlackBerry, and what they could mean for the company.
Trefis has an $8 price estimate for BlackBerry, which is below the current market price.
BlackBerry Smartphone Updates
While BlackBerry announced that it would exit the handset business last year, the company continues to work with hardware partners in markets including China, Indonesia and India, who manufacture and sell BlackBerry-branded devices. TCL, one of Blackberry’s partners based in China, recently launched a new device called the KeyOne that has received reasonably positive reviews from critics. The device sports a physical keyboard in addition to a touchscreen and runs BlackBerry’s modified version of the Android software with security enhancements. Separately, the Optiemus Group, which holds the license to manufacturer BlackBerry branded hardware in India, plans to invest about $30 million to relaunch the brand in the market. The firm intends to initially focus on enterprise users, selling primarily via retail chains, before widening distribution to other vendors. The company plans to launch two new models over the next few months, priced at under $600 and $300, respectively. BlackBerry will bank on these new launches to keep the roughly 14 million users on the BlackBerry platform worldwide engaged, while bringing in some high-margin licensing dollars.
BlackBerry’s Automobile Security Play
BlackBerry is reportedly developing security software for the auto market, working with two high-end car companies. The solution apparently acts as a virus scanner for automobiles, warning drivers when a vehicle could be compromised, while also installing software patches to vehicles. This could be a sizable market for Blackberry in the long run, as automobiles are being shipped with an increasing amount of computing power and internet connectivity, bringing about security related risks. BlackBerry could be well positioned to cater to this market, given its strong presence in the automobile industry (its QNX software powers infotainment systems on over 50 million vehicles) and also