BlackBerry Courts Keyboard Loyalists

BlackBerry aims to please its old school business customers with a new traditional-style phone plus revamped enterprise software.
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Beleaguered phone maker BlackBerry came out swinging at Mobile World Congress on Tuesday, with a new phone that harkens back to the days before touchscreens, BlackBerry Messenger enhancements, and promises to deliver better mobile device management software and messaging security software.

The company introduced a simplified two-tier pricing model for BlackBerry Enterprise Service (BES), its mobile device management (MDM) software. Also, it will migrate customers of BES and other device management systems to BES 10 for free. It promised to deliver BES 12, the next version of its MDM software, by the end of the year, with an early adopter program beginning this summer.

Version 12 will provide: new mobile endpoints; better user self-service; more service management capabilities; support for Windows Phone 8; support for datacenter-grade deployments and server clusters; and monitoring and systems tuning, among other features.

BlackBerry also will offer a set of new applications, called eBBM, designed to enhance its popular BlackBerry Messenger application. eBBM for enterprise customers should debut this summer. The only announced application is BBM Protected, which provides end-to-end encryption of messages using symmetric encryption. The program is intended for business customers in regulated industries.

[Want more details on the latest Nokia smartphones and what they mean for Microsoft? Read Nokia X, Android & Microsoft: 6 Facts. ]

The company announced Daimler AG and Airbus Group have become BES 10 customers and has also reportedly convinced Ford Motor Company to replace the Windows Embedded Automotive operating system that serves as the foundation of Ford's in-vehicle Sync communication system with BlackBerry's QNX operating system. A company spokesperson did not immediately respond to a request for comment.

BlackBerry's latest flagship phone, the BlackBerry Q20, is either hopelessly or cannily retro: It sports Menu, Back, Send, and End buttons, a built-in keyboard, and a trackpad, as if to flout the conventions established by Apple's iPhone in 2007 and reinforced by Android devices.

John Chen, BlackBerry's CEO since November, said in a statement that the Q20 reflects what the company's ardent customers, "QWERTY loyalists," want.

What Chen wants is to turn his company around. BlackBerry reported a $4.4 billion loss in December for its third fiscal quarter. Research firm IDC put BlackBerry's share of the smartphone sales during the fourth quarter of 2013 at less than 1%.

Although investors appeared to be heartened by the announcements -- BlackBerry's stock was up about 7% on Tuesday -- Gartner analyst Ken Dulaney remains unconvinced the company can reconnect with business customers. In September, Dulaney wrote a report advising businesses to consider alternatives to BlackBerry.

Despite BlackBerry's decision to lower prices and promote free migrations, the company's best hope "is probably what happened with Facebook and WhatsApp," said Dulaney in a phone interview. He noted that BBM looks like the company's strongest asset given that car companies control costs tightly, making QNX an unlikely source of major profits.

Facebook last week said it is buying WhatsApp, a popular messaging app, for $19 billion. In an interview with CNBC, Chen said he'd be willing to sell BBM for that much. Such a generous offer probably isn't forthcoming: BBM, with 80 million active users, has only about 17% as many active users as WhatsApp.

Dulaney suggested BlackBerry's latest announcements didn't change much for the company. He doubts BlackBerry will gain much traction with BES because so many companies use similar software from other vendors already. And he dismissed the Q20 because it arrives with a small screen at a time when Android phones with 4-inch screens are available for under $100 without subsidies.

"I don't think much has changed," Dulaney said. "The challenges remain the same. They're trying to take what they've got and make hay out of it. It's up to the market now."

Too many companies treat digital and mobile strategies as pet projects. Here are four ideas to shake up your company. Also in the Digital Disruption issue of InformationWeek: Six enduring truths about selecting enterprise software. (Free registration required.)