BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) CEO John Chen expects his company to thrive not because its volume of sales will overshadow its competitors, but because it will always be the best option for an elite class of users.
“Take the automotive industry; it’s not all about volume,” said Chen in an interview with Rich Karlgaard at Forbes. “Porsche is doing extremely well. Now, Porsche serves a particular segment of the market, doing well for its shareholders and owners. It always serves the market for a purpose, which is the whole point.”
Merkel switched to BlackBerry for better security
From his point of view, BlackBerry serves two key purposes: it has a high functioning keyboard for people who still care more about productivity than the number of apps available to them, and it has the best security in the market. Chen estimates that the regulated industries account for about 30% of all IT spending and figures it should be a comparable percentage for telecom spending. Even if BlackBerry never regains its standing with general consumers, it can be a profitable company by leading a third of the market (the wealthier third, generally speaking).
“There’s a huge market segment out there for any regulated industry. Governments, financial services, health care. I think we can go capture those and become a winner,” said Chen. “After Angela Merkel was hacked she moved straight to a BlackBerry.”
Urgency is the key factor for turnarounds
There’s no question that Chen has inspired new faith in BlackBerry since his tenure began in November. Even if sentiment is still bearish, people have at least stopped writing obituaries and calling for the IP portfolio and Enterprise division to be sold off before the company burns through any more cash. Asked what was most important in turning a company around: “Urgency. And an obsessive focus on the things that matter,” said Chen. “The CEO and the team need to know the details. You can’t know the minute details about everything, but you need to know the details.”
If he succeeds in bringing BlackBerry back to profitability, it will be Chen’s willingness to stop competing head-to-head with Android and the iPhone and focus on the company’s strengths, the things that matte, that did the trick.