BlackBerry Ltd. is going over the head of news and social media to make sure it gets the message out that it isn’t planning on disappearing.
In full-page ads placed in newspapers over a dozen countries, the Canadian smart-phone maker has a straight-forward message: “You trust your BlackBerry to deliver your most important messages, so trust us when we deliver one of our own: You can continue to count on us.”
It is signed by “The BlackBerry Team,” and not CEO Thorsten Heins.
The ads come as BlackBerry’s books are being scrutinized by Toronto-based Fairfax Financial Holdings, which hopes to lead a consortium of lenders to make official a tentative offer to buy the public shares of the company and take it private. Fairfax CEO Prem Watsa has been quoted in the press as saying he wants to keep the company together as it restructures.
Meanwhile BlackBerry founders and shareholders Mike Lazaridis and Douglas Fregin have filed papers with the U.S. Security and Exchange Commission that they are thinking of mounting a bid.
One of the problems with the offers is they need substantial loans to be realized, and the investment community is wondering who wants to pour money into a handset maker that is losing market share.
The message tries to assure subscribers the company still has legs because it has “substantial cash on hand and a balance sheet that is debt free. We are restructuring with a goal to cut our expenses by 50 per cent in order to run a very efficient, customer-oriented organization.”
“These are no doubt challenging times for us,” the company admits, “and we don’t underestimate the situation or ignore the challenges. We are making the difficult changes necessary to strengthen BlackBerry.”
There are, however, doubts among financial and industry analysts whether that can be done. Although the ad talks about the four new BlackBerry 10 smart phones that have been introduced this year on its new operating system, so far those handset have failed to excite buyers.
As a result, in the last financial quarter the company wrote down around $900 million worth of unsold handsets it has in inventory.
That has led some observers to argue BlackBerry will have to be broken up.
In essence the ads are the company’s response that a breakup isn’t its immediate strategy.
“The newspaper ads are designed to reassure Blackberry customers that the company is still here to support them, and to communicate their commitment and remind customers of the quality of their solution,” Krista Napier, senior mobility analyst at IDC Canada, said in an email. “While this is unlikely to cause a material change in their market position, it is an important message to communicate nonetheless.”
Carl Howe, a research vice-president at Yankee Group, said in an interview BlackBerry that wants to provide a counterpoint to the “BlackBerry is dead” reports that some are writing – “largely without fact, other than they had a bad earnings report.”
The audience for the ads, he believes, are CIOs who are responsible for mobile device buying.
While research firm Gartner has advised customers to think about moving to a different platform, Howe is skeptical: “You have a technology in place that works, that’s certified by security authorities and is trusted by almost security auditing firm, and you’re going to exchange that for something that hasn’t hit the market – Samsung Knox? Doesn’t make a lot of sense.”
When asked if the argument is how can an organization continue to invest in a platform that is declining, Howe retored that “people don’t have any problem doing that with Windows.”
IT organizations don’t throw things away that work, he argued.