With the announcement of the “partnership” of IBM (NYSE:IBM) and Apple (NASDAQ:AAPL), some dumped BlackBerry (NASDAQ:BBRY) stock overnight. Evidently, some don’t know the industry as well as they thought. Investors need to realize:
- Announcements are cheap. Deliverables aren’t.
- IBM/Apple partnership does demonstrate BlackBerry has right strategy and has identified a real niche.
- Competition is good. It moves the markets. Product development accelerates and consumers are the real winners.
Some BlackBerry investors got the message, “Game Over” when they should be looking at this announcement as, “Game On – this is a real market niche“. Take it one step further in analysis and you see major players saying, “We have to get into this game because it is critical for us”.
WEDDINGS ARE EASY. MARRIAGES TAKE TIME
An article stating that Apple and IBM are going to partner to provide a better enterprise-wide solution and better mobile security for business customers is a big announcement, but that’s all it is, an announcement.
IBM will provide services via Apple’s iOS including device management, security, analytics and mobile integration. IBM will also create 100 exclusive business applications for the iPhone (and iPads) to be sold to its business customers.
Where are the deliverables of this marriage and did customers buy into the products?
It is too early to measure any success, just like it is too early to measure the success of BlackBerry’s initiatives.
Reading through so many investor comments, who are both short and long, I see criticisms that had questioned BlackBerry’s strategy. Now, it seems as though two major players, IBM and Apple, are blessing that strategy and saying, “Yes, there is validity to that strategy and we have to come up with some solutions.” “I understand the market and have a product that fits” is a statement which is much further along than “We agree that there is a market niche and we will be building some products in the future”.
Building products takes time. Making sure they work takes more time. What will the “marriage” of IBM and Apple produce? Only time will tell. Maybe everyone should take a deep breath and remember a good quote from Hal Geneen, the former CEO of ITT:
In business, words are words, Explanations are explanations, Promises are promises, but only Performance is reality.
John Chen (CEO of BlackBerry) did not die. His vision is still viable. He needs time to execute his strategy just as much as IBM and Apple now have to have time to deliver on their big announcement.
This reminds me of when Apple first introduced the iPhone and there was both skepticism that it would sell along with those who looked at all the other phones in the industry and said, “Game Over”.(see article – wtnnews.com/articles/3612
Real competitors did not sit around. Real competitors came out with products that matched and surpassed Apple. The ones who really benefited from that competition were the customers and the overall industry.
NO ONE HAS A CRYSTAL BALL
No one has a crystal ball, so no one can say, “Game Over”. If anything, this announcement lends credibility to BlackBerry having a real market niche and the “big players” need to get into that game.
The big question should be, will BlackBerry partner up with someone else or continue on its own path? No one knows that answer except John Chen.
CARLINI-ISM: Just remember, you’re not an expert in the Smartphone industry because you bought one and now know how to play “Angry Birds” on it.
Disclosure: Long BBRY. The author wrote this article himself, and it expresses his own opinion. The author is not receiving compensation for it. The author has no business relationship with any company whose stock is mentioned in this article.
Carlini’s visionary book, “Location Location Connectivity” will be coming out later this year. 
He will be speaking at several upcoming conferences across the country later this year. Details are forthcoming.
Follow daily Carlini-isms at www.TWITTER.com/JAMESCARLINI Copyright 2014 – James Carlini – ALL RIGHTS RESERVED
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It’s simply amazing how the negative comments all over the web come from people who don’t like BB phones or based on experiences from 5-10 years ago. Also most are clueless at what it takes to turn a business around. I was involved in a turn around, it was very difficult but doable long term. When I read what the CEO is doing with BB, I’m convinced he will succeed with some time. Once that wheel to recovery takes momentum we will then see huge gains with Blackberry.
It’s the same as personal finances, it takes time to improve and get ahead. John Chen has the golden touch and surrounds himself with people better them himself. Exactly what the CEO from Bombardier did decades ago to turn a small bankrupt business into an amazing success story. While he was in control of course. 😉
Great article James. Keep them coming.
I mean “have different cultures”.
By marrying IBM and Apple, this might increase the cost of R&D affecting their earnings because these two have cultures.
I worked at IBM some years ago, the thoughts of Big Blue teaming up with Apple makes me a little queasy. I just can’t see the duo meshing in a meaningful way
Great piece. I was very happy that I was able to pick up more cheap shares today.
I don’t see the Apple-IBM marriage working out.
iPhones are made for personal use and are popular with teens and 20-something hipsters. Same can be said about Android-based phones; really popular with teens and hipsters. You know, the ones that like apps and games that waste valuable time, but are useful when sitting on a bus or sipping latte in a coffee shop.
4 years ago, Blackberry was down and out (with personal users), because it did not have the cool factor with young people, but considering that business people still rely on Blackberry and have done so for multiple years, I believe that Chen’s strategy will work out. Chen is just the right man at the right time for Blackberry.
I just can’t imagine business people using iPhones in their work lives. Blackberry is still where it’s at in the Business world and will remain so for many years to come.
Rob – some good insights. As I said in the article – Announcements are cheap. Deliverables aren’t. I think Chen is doing a good job as well.
1) Apple has lots of cash. 2)Blackberry has QNX and lots of security, how do we know this? Simple: The Secret Service requires the President to use a Blackberry. 3)Facebook paid $19 billion for WhatsApp. 4) So, in my humble opinion that would make Blackberry, its patents, and QNX (which is used in autos, high-speed trains, MRI machines, in the aerospace industry, and in dozens of other applications) worth many more times than the current market capitalization of around $5 billion.
Let that sink in for a second: Facebook paid $19 billion for a company that I believe had (don’t quote me) around 50 employees. And Blackberry is supposed to be worth only one fourth of that? I’m long and will be getting longer as son as the dust settles.
rosie – thank you for your insights. I agree BlackBerry is undervalued at this point and they are beginning to be turned around by the CEO Chen.