This article is more than 1 year old

BlackBerry's licensing strategy looks smart – and a lot like Nokia's

It's an IP world now

Analysis BlackBerry didn’t show a new phone in New York City at its annual Security Summit last week, and CEO John Chen sounded a bit fed up that the assembled press corps kept asking about phones. But there was enough in his comments to glean how BlackBerry’s device strategy has evolved - and it’s following a familiar path taken by once-mighty Western electronics brands.

One, in fact, that’s remarkably similar to that of Nokia. Not to mention Leica and Zeiss.

All these companies are essentially licensing their brand and – in varying degrees – their technology know-how too. It’s a recognition that the global centre of gravity for manufacturing is now In China, which can also absorb the risk of moving into new markets. And in theory, it suits both sides. If Chinese industry can out-engineer and out-manufacture the West, it hasn’t yet show it can out market an Apple or a Sony.

Nokia announced its strategy in November 2014, but it was off to a bit of a false start. The N1 tablet, manufactured by Foxconn, never appeared in the West (and didn’t really appear in China for very long either). It took 18 months to clarify, with the formation of a new company in May, HMD Global Oy.

In BlackBerry’s case, it’s going to be subtly different. The brand comes with a software stack and set of requirements before it can be deemed worthy of carrying the logo. BlackBerry announced its “crown jewels” were available for licensing back last year at Mobile World Congress, when it promised to license and/or make its software suite available for iOS and Android.

This appears to be a further evolution: securing a third party device, loading it with some BlackBerry software, and then branding and selling it. The first fruit of this is expected to be announced imminently, with a “BlackBerry-ized” Alcatel Idol 4.

Last week, the TCL-manufactured BlackBerry device showed up again in regulatory reports.

“We have a tremendous amount of technology. We can stay in the handset biz by not making every handset,” said John Chen last week.

Musing on what BlackBerry could license, he explained:

“Maybe even the name. But obviously this is at a different level, we have to protect our brand reputation.”

Chen had justified the continuation of a device business because so many blue chip enterprise customers were BES and Blackberry device customers too.

“I could stay in the handset business, where I provide a strong secure end point and by providing customers continuity and a soft landing - if I can make money doing that.”

How much BlackBerry is there in a rebadged phone?

It’s an acknowledgement of the reality that even the once unassailable high-margin electronics brands have had to confront. German imaging giant Leica is synonymous with high end SLRs, and vows to stay there, but is gradually complementing this by licensing much of its IP portfolio, allowing Chinese manufacturers to buy some credibility. The first results of the multiyear agreement between Huawei and Leica emerged in April.

This raised some to question how deeply Leica was involved in co-engineering the dual lens imaging units. But it’s actually subtly deeper than most people realise. Optical giant Zeiss (formerly Carl Zeiss) apparently certifies factories when it deems that they pass its tests. Reading the joint statement issued by Huawei and Leica, we could infer that the agreement works in a similar way. Pay particular attention to the lines: “Collaborative development, evaluation optimization of optical design (lens calculation) in compliance with Leica standards” and “Definition of the most stringent common quality standards and production requirements for serial production by Huawei to ensure consistently high quality.” (Our emphasis added). We've asked Leica for comment.

For BlackBerry branding to work, it would be wise to do something similar. Security concerns over Chinese technology have inhibited their growth in the USA. BlackBerry calls itself an end-to-end security company these days, and touts its Priv as the most “secure” Android. And it sells to the most security-conscious customers in US defence and government. So assuring people the manufacturing processes are squeaky clean is probably a prerequisite.

If BlackBerry can pull it off, it may yet confound expectations and stay in the device game for a while yet. ®

More about

More about

More about


Send us news

Other stories you might like