BlackBerry CEO John Chen’s statement today marks the end of an era: “The company plans to end all internal hardware development and will outsource that function to partners.”
With revenues in the second quarter of 2016 falling by nearly a third and its recent pivot to Android failing to boost sales, there was no choice but to follow through on the promise to leave the handset business if they couldn’t make it profitable.
The departure from hardware isn’t unexpected. Analysts have been predicting that BlackBerry would switch to software for some time, and its most recent device are other vendors’ hardware with BlackBerry branding (the DTEK50 is an Alcatel Idol 4, and leaked photos suggest that the DTEK60 is the Idol 4S). There’s also the matter of Chen being less than enthusiastic about the company’s hardware business, from his focus on the software side of BlackBerry, to outsourcing manufacturing to several Taiwanese companies, to this “I don’t really use the thing” demo of the Priv from last September:
“We are reaching an inflection point with our strategy,” says Chen. “Our financial foundation is strong, and our pivot to software is taking hold.” The sea change may keep the company alive, but it’ll be a far different entity than the industry-defining behemoth it once was.