The smartphones of BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB), such as the BlackBerry Q10 and BlackBerry Z10 are not attractive to the potential buyers of the company.
BlackBerry 10 operating system
A report from Reuters indicated that interested buyers are primarily interested in acquiring the BlackBerry 10 operating system that powers the smartphones based on information from unidentified sources. In addition to the operating system, buyers are also interested in certain patents of BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) relating to keyboards.
The following is our rough coverage of the 2021 Sohn Investment Conference, which is being held virtually and features Brad Gerstner, Bill Gurley, Octahedron's Ram Parameswaran, Glenernie's Andrew Nunneley, and Lux's Josh Wolfe. Q1 2021 hedge fund letters, conferences and more Brad Gerstner And Bill Gurley Brad Gerstner - what is most overhyped? Bill Gurley Read More
There had been reports that Prem Watsa’s Fairfax Financial Holdings Ltd (TSE:FFH) (OTCMKTS:FRFHF) and the largest shareholder of BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) with a 10 percent stake might acquire the entire company. According to the Sunday Times, Watsa is close to reaching a deal to save the struggling Canadian smartphone manufacturer and was able to convince a consortium of buyers willing to invest billions to acquire the company.
BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) was recently valued at approximately $5.4 billion. The company is having difficulty in finding investors because of the strong competition within the smartphone market, and its devices failed to attract consumers.
BlackBerry’s market share
The smartphone market share of BlackBerry 10 in the United States was only 1.1 percent for the June quarter this year. During the same period a year ago, its market share was 4 percent. The company is also losing traction in United Kingdom with only 4.1 percent market share.
Its competitors in the smartphone market, such as the iPhones powered by the iOS of Apple Inc. (NASDAQ:AAPL) and devices powered by the Android operating system of Google Inc (NASDAQ:GOOG), have 42.5 percent and 51.5 percent market shares, respectively. Obviously, the iOS and Android devices dominate the smartphone market.
Based on the report of the IDC, the smartphones powered by the Android operating will capture 75 percent of the global smartphone market this year. The iOS will gain 17 percent, Windows Phone 8 will capture 3.9 percent and BlackBerry 10 will obtain the smallest market share of 2.7 percent.
Investors lack interest
Ezra Gottheil, analyst at Technology Business Research, said the lack of interest among investors to buy BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) is surprising.
“The patents and platform are worth quite a bit, but I also think the device business could be run at a profit. BlackBerry tried to follow Apple Inc. (NASDAQ:AAPL) and then Android into the consumer space, but I think there is a place for a business device, one that is more secure, easier to use for email and has lower network costs,” said Gotheil.
On the other hand, Gartner analyst Carolina Milanesi opined that a vendor from the enterprise industry is the best fit to acquire the Canadian smartphone manufacturer particularly its services and hardware business. She said an enterprise vendor could capitalize on BlackBerry secure network.
Jefferies managing director, Peter Misek, previously pointed out that BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB)’s crown jewel is its Enterprise Business because its networks are “NSA proof.”