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BlackBerry's turnaround relies on a secret weapon: Its own network

The NOC nobody wanted is actually quite useful

Analysis Last year we invited you, as a thought experiment, to value BlackBerry as an oddball cluster of startups – and now it seems the company has taken our advice to heart. It forms the heart of its strategy: the once tightly coupled divisions are free to compete – even if it means taking business off each other.

It also means playing down the "BlackBerry" brand, executives told us in briefings this week. But BlackBerry is reassembling the divisions in quite an interesting way – with its own private network in many cases providing something others can’t, and that translates into a lot of convenience.

“BlackBerry customers were like a little lost platoon that’s been left out, and was running out of ammunition,” when the new management headed by turnaround artist John Chen, arrived a year ago, BlackBerry’s global enterprise chief John Sims told us.

BlackBerry ploughed on, investing $1.5bn annually into R&D and ignoring the pundits who advised a rapid breakup of the company, which comprised a private secure network (the “NOC”, or Network Operation Centre), management server software, and a beleaguered devices unit. Analysts concluded that because mobile users fetched email directly rather than by a proxy, the NOC should be divested. In fact it has turned out be useful for new services in some subtle ways.

The software house that BlackBerry R&D built

At last this month, the R&D bore fruit. Eyebrows were raised, though, when along with the flood of announcements alongside the expected BES12 were a wide range of value-added services. BlackBerry now wants to raise $500m of revenue getting an enterprise software business off the ground (from $250m now) and bolt-on goodies including BBM Meetings, Blend, Secure VPN and a clever virtual SIM for enterprises.

This means playing down the BlackBerry Brand, John Sims, global enterprise chief and former SAP executive told us.

“It’s a work in process to rehabilitate the brand as a cross platform brand. We did that at the start of the year as something to work on.”

So BES isn’t called “BlackBerry Enterprise Server” any more, just BES. Likewise BBM. All slides must demonstrate the cross-platform nature of the services and offerings.

Treating divisions like startups meant they were free to strike their own deals – the most eye-catching being the Samsung Knox partnership. The result is that Samsung has the “most manageable” Android device offering – doing secure boot and app containers – while BlackBerry’s server does the management. Previously, the proposition was that for a secure work/personal partition you needed both a BB10 device and the BlackBerry server.

Executives admit the first meetings with Samsung were “frosty” as the Korean giant viewed BlackBerry with suspicion.

Similarly, the devices unit opened up the management APIs so that other MDM software, not just BlackBerry’s, could do the device management – benefiting rivals such as MobileIron or AirWatch.

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