Lenovo looking towards BlackBerry to help their mobile business?

Lenovo
By Chris Umiastowski on 24 Jan 2013 03:01 pm EST
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Earlier today, Bloomberg’s news team published a really interesting story on RIM with credible sources, unlike all those supply chain rumours that led Apple’s Tim Cook to tell analysts to smarten the hell up.

Here’s the short version of what’s going on: Bloomberg interviewed Lenovo’s Chief Financial Officer at the World Economic Forum’s annual meeting in Davos, Switzerland. In the interview, the Chinese computer maker’s CFO spoke about possible acquisitions or strategic alliances.

He said, “We are looking at all opportunities -- RIM and many others.” Showing they are serious about diversifying away from being a pure PC shop, he said, “We’ll have no hesitation if the right opportunity comes along that could benefit us and shareholders.”

The rest of the Bloomberg story discusses the context around this situation. The PC market is shrinking, RIM has been a troubled company, but is on the rebound, an acquisition of RIM would trigger a review by the Canadian government, etc.

I do not think it makes sense for Lenovo to bid on RIM. But I do think it makes perfect sense for them to form a strategic partnership. Remember that Lenovo is a Chinese company. RIM does business with the most of the governments around the world for enterprise communication. Want to bet that RIM in Chinese hands will cause just a tad of worry? Ok, not a fair bet. I understand if you don’t want the other side of that one.

But a strategic partnership? That makes way more sense. What form could this take? It could be an exclusive licensing of BlackBerry 10. It could be an outright sale of the hardware business. It could be a modified licensing and marketing agreement where Lenovo goes after the emerging markets.

Right now Lenovo isn’t on the map with Android either. They’d probably have a tough time competing against Samsung in that space. And they’d have a tough time up against Nokia with Windows Phone (which may not be the best platform bet anyway).

So RIM makes sense. But I don’t think we’ll see anything for a few months, minimum. Remember - Thorsten has said they need to prove their platform first. Deals come later.

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Lenovo looking towards BlackBerry to help their mobile business?

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I don't think it has been used for that long. I remember seeing an ibm lenovo laptop/pc and it didn't use that tagline. But maybe that was different brand :p

I already run QNX on my T61. I haven't done anything with it in years, but it's still there.

This is an interesting and potentially good fit. IBM would have made more sense, but there's still an enterprise feel and shared design aesthetic.

Lenovo Think Tab?

If RIM is once bitten twice shy about Tablets, Maybe it makes sense for a partner like Lenovo to make a kick ass BB 10 Tablet or two?

Interesting tidbit. But the provided links hit a redirect loop and don't go thru.

I'm on Mac OSX running Chrome.

Anyone else having this problem?

The links seem to be wrapped inside an internal 'admin.crackberry.com' url. If you tear out the original from there you can get to the source, but they need to be fixed to be clickable.

Chris?

I'm excited about the integration possibilities of BB10 with a full-blown laptop, QNX powered or otherwise.

There's no way the Canadian government would let Lenovo acquire RIM, but a limited strategic partnership is possible. I like the idea of licensing BB10, but I don't know all the security implications of that.

I agree. RIM is "dead" if they sell to Lenovo. The US and over countries, especially the enterprises, will let go off the BlackBerry.

Being a huge thinkpad fan, I approve, and I might even consider a ThinkBerry*.
I think this has more potential for Lenovo to license BB10 on their own handsets. A full blown sale would be a tough pill to swallow!!

Me too! I'm hoping that in a year or two this starts to happen. The Pentagon and other high security institutions would probably be interested in basic, secure platform.

if Lenovo was to buy RIM i think they would lose alot of corporate and goverment accounts concidering the U.S goverment dont trust Levono

This is just the opening shot. Going public with your real or not real intentions could have the ability to flush out the other (if any) players.

Chris - can you please clarify what all this stuff about "selling the hardware business" is?

I simply don't get it. I understand what it would mean, but why would any company ever want to buy the BB hardware line and why would BB ever want to sell it?

I love my BB phones and my PB tablet, they're great pieces of hardware (durability and feel), but why would anyone ever want to buy that line off of RIM? To do what?

From a buyer's perspective - anyone could make hardware, what makes RIM hardware special? What OS would they use if they did? A blackberry is a blackberry because of the OS (that point is emphasized now we're shifting to the Z10 with the somewhat generic full touch hardware specs).

It wouldn't make much sense for a company to buy RIM's hardware division in order to put in BB10 software either. What company would spend billions to acquire a hardware division to have no control over their OS? They'd be sitting on their thumbs waiting for RIM to come up with new software updates etc. (We all know that RIM has been pretty slow about this in the past and has had issues with delays)

From RIM's perspective - Honestly, how much money could they possibly make off this? If they were to stop making software and just make software, that would mean they would have to deal with 3rd party manufacturers. It would just be adding a whole lot of bureaucratic garbage that would ultimately slow down their ability to get products out to the masses and ultimately the ability to make money.

Lenovo -struggling?
On some alternative planet.

Also, Lenovo has a track record of joint ventures with other companies in different parts of the world - they seem to aspire to be a true multinational, with headquarters in the US, Singapore and Beijing.

Lenovo making a wide range of BB10 hardware while RIM concentrate on the pure BB experience - like Google with Nexus - would seem to be an extremely good idea.

Lenovo, go home, you're drunk :D

Anyway, merging ThinkPad division with RIM seems good mix. But I doubt that Canada will allow this at all.

If any chinese company bought RIM i would toss my phone in the garbage and by a Samsung or iPhone...

Strategic partnership, yes, out right sale, sorry will never happen. A strategic partnership would effectively kill apple margins and could make Blackberry 10 the top OS in a very short time. :)

Interesting times ahead!

Agree. Fascinating to watch. Lots of moving parts in the mobile space at the moment and RIM is ideally positioned to launch itself forward. BB10 isn't even released at it is already helping to reshape the industry. If BB10 were to go to a desktop well then the doors are blown open. You can bet that microsoft and Apple aren't too happy at the moment.

Great assessment, Chris. Was just saying much the same thing in the forums.

And I REALLY wish the press would stop jumping on off-handed comments.

If Lenovo liscenses BB10 to bring BB10 into China (Lenovo's stated objective to to conquer the China market) - that can only be seen as a massive win.

It could be a modified licensing and marketing agreement where Lenovo goes after the emerging markets.
_______
Apple would poop their pants,lol. Blackberry 10 OS would dominate!

If Lenovo buys RIM I'm gonna have to switch to Apple. I need another Chinese owned piece of electronics like I need a punch in the throat. I think the US and other Western Governments would have to think twice if RIM was owned by a Chinese company.

Lenovo isn't state controlled like many mainland Chinese companies. It is also diversified around the world. Lenovo worries me no more than does Asus. Huawei it isn't.

I'm seeing a lot of xenophobic messages here, if a company makes good products who cares who rules the company?

Nothing bad meant against the Chinese people at all. Some of my best friends are Chinese. The problem is that some computer spying has originated from China so that requires some caution.

No way lenovo will buy RIM. This would destroy RIM reputation. As a partner, Ok.

Look for other partnership. Consider Philips, Nintendo, Bosch, dell, ... soooo many possibilities.

Agreed with the commentary here. When I first heard about the article I figured there was no chance of an acquisition but a licensing agreement would be mutually very beneficial.

Canadian Government would never allow it, period. Anyone thinking otherwise might as well as forget it.

This is dangerous and Candian Government wont allow the merger or takeover. THe reason is If Chinese involved no Government agencies (US, Canada and lots of other countries will stay away from Blackberry. Everybody knows why!

Since Lenovo is a Chinese company, they will probably lose a lot of RIM's existing US Government BlackBerry business, at least with the more security conscience agencies.

Even if our Prime Minister gave thought to allowing a Chinese company purchase RIM, as he is doing with our energy sector now, the sale could never go through mainly due to the response by the US government. I think we all know what that response would be and it has some validity

To be honest, I'd rather RIM remain solvent as this would prove to the world that what RIM did,...could be done. But if they were to sell,....I'd want the buyer to be Microsoft! One can only imagine what can happen to BB 10 with Bill Gates fat-ass pockets?

JMD

PC market shrinking, i agree. I think recently tablets outsold laptops for the first time. I doubt BB10 will run on any kind of laptops or ultra.book for that matter. Thorthen Heins repeatedly spoke of mobile computing, well what does that mean? Recently, Ubuntu announced they will be releasing a mobile computing platform as well.

I think moblie computing will be an integration of smartphones,tablets and phablets that will be used for everything from unlocking your house or car door with NFC and everything and anything the average person can think of.

As for laptops, its a dying breed. I think we will see larger tablets to replace laptops. (in my opinion). So, having BB10 OS that is powerful as your PC computer running on a tablet is what Lenovo and other manufactures would be aiming.

PC market shrinking, i agree. I think recently tablets outsold laptops for the first time. I doubt BB10 will run on any kind of laptops or ultra.book for that matter. Thorthen Heins repeatedly spoke of mobile computing, well what does that mean? Recently, Ubuntu announced they will be releasing a mobile computing platform as well.

I think moblie computing will be an integration of smartphones,tablets and phablets that will be used for everything from unlocking your house or car door with NFC and everything and anything the average person can think of.

As for laptops, its a dying breed. I think we will see larger tablets to replace laptops. (in my opinion). So, having BB10 OS that is powerful as your PC computer running on a tablet is what Lenovo and other manufactures would be aiming.

Never really got what Lenovo was about until I replaced my aging HP with one in September. It`s a no frills business computer that is security focused. It took me a while to get used to it but now I think of it as people think of a 9700: solid, reliable, safe. I can see a partnership of some kind working for both parties, it makes perfect sense.

Michael Dell is taking Dell private. I'm guessing so he doesn't need approval to go crazy on acquisitions. One of them will be RIM. You heard it here first. Or 32nd. :)

RIM is too big for his tastes, in 2 short months RIM will be in a position to buy Dell and not the opposite.

This is my reading of one possible scenario.

Basis : Takeover of RIM by Lenovo won't append. It will burn instantly a) all security certifications b) most of strategic and historical clients of RIM. Ok, that said :

1/ There nothing particular in BlackBerry hardware that could forbids its *assembly* in China
2/ Not sure for N.A but here, in Europe it's becoming usual to have a "two range levels" strategy (tough ones could search for Renault / Dacia case as an example). This basically means two very distinct (brand/products names, price, factory locations, distribution points, features, range end, advertising) products lines sharing part of components. Usually, the differentiator is the price, as the low-end "brand" uses mostly components the high-end "brand" has used previously and/or already amortized. But it can also be used for economies of scale (hope this is not a bad translation; means : the more you buy, the less it costs).
3/ BB10 is a puzzle of components, "one" being the security feature based on the physical correlation between the device and the user (ID). But another one - similar or slightly modified - could be implemented quite easily, not to mention ActiveSync.
4/ Chinese market is today bigger than the N.A one ... and it's a newborn one, where wired communications are still in the stone age (in 95% of the country).

From there :
What could reasonably prevent RIM to sell or give exclusive AND localized build/distribution agreement to a foreign partner ? Nothing.
Now, Lenovo is Chinese. What if RIM makes a deal like this one (100% speculative and meant to be an illustration of my purpose) ? :
I (RIM) sell you (Lenovo) my mid/low-end market for China. You build under your name and with different products names and you distribute, but you must use BB10 (modified: say, no BIS, no BES) and pay for it.
[repeat for any country where it can apply : India ? South America ? rest of Asia ? Africa ? Eastern Europe ?)]
Just imagine what it figures in terms of economies of scale ... as I wrote earlier in the " I support RIM and I buy shares" thread : boooom. I'll even try a funny one : BBboooom. :)

Makes sense. I can see a 'blackberry inside' lenovo. Not a blackberry, but a lenovo-powered by blackberry. I'd want to get one if they make that kind of laptop. Or phone, to replace my nokia :D not tablet though, I only want to get a playbook ^^

I can agree with a partner ship, but no way a complete buyout. This would kill RIM and it's credibility IMO. PLUS the Canadian Government would never let this happen because it would affect Canada.

I'm not a fan of this proposed deal from Lenovo because I'm thinking that Canada will be on the losing end of this deal. We already lost Nortel due to bankruptcy. We don't need to lose another major telecommunications giant. It's not going to do Canada any benefits either in the short term or the long term in my opinion.

As a Canadian, I'd prefer RIM to remain as an independent company. If they were ever tp be bought out and the Canadian government somehow allowed it, I will dump all RIM products immediately and sadly would have to resort to Android.

No acquisition of RIM in whole or in part won't happen until late 2013 / early 2014. RIM is not overly eager to sell right now.

No acquisition will keep me with BB. I'm as loyal as fans come, but selling out will have me picking up a Samsung device so fast Telus wouldn't know what happened. Strategic partnership? Sure. If youth hoping they're gonna be acquired, gfy.

Well if RIM is to partner with Lenovo in some kind of way, i would hope that it would be to improve on the Playbook. Even though the PC market is a rapidly shrinking one, we still use them. I don't foresee a laptop with QNX as an OS, but I can see Tablets, lots of them. 5in, 7in, 8in, 10in, Blackberry / Lenovo Tablets flooding the market taking aim at the iPad.

Mr.C
Dedicated Blackberry User
BB-PIN: 329D6421
PB-PIN: 50110033
(Video Chat about BB-Business ONLY)

Well if RIM is to partner with Lenovo in some kind of way, i would hope that it would be to improve on the Playbook. Even though the PC market is a rapidly shrinking one, we still use them. I don't foresee a laptop with QNX as an OS, but I can see Tablets, lots of them. 5in, 7in, 8in, 10in, Blackberry / Lenovo Tablets flooding the market taking aim at the iPad.

Mr.C
Dedicated Blackberry User
BB-PIN: 32FA2604
PB-PIN: 50110033
(Video Chat about BB-Business ONLY)

When I was in China recently you would see Lenovo shops like you see Apple shops here. The Chinese seem to value brand names as much or more than we do. For example Blackberry being an iconic phone that they see in the movies would make a big impression. Young consumers that are upwardly mobile will pay more for an article of clothing with a brand name even though it is identical to the same product with no brand name. So a Lenovo made but Blackberry in appearance and name phone sold in Lenovo stores would be a big success in China.

So a partnership for the Chinese market makes a lot of sense.

But we have seen how Lenovo diminished the Thinkpad brand and product and the same thing would happen to Blackberry if Lenovo bought out RIM. Would Canada allow the sale ? A year ago - yes but now that RIM has got it's mojo back I am not so sure. The govt needs Ontario voters to win the election . It is our swing state. Given the recent loss of jobs in the auto sector I think that they would not like the sale - unless perhaps if the major pensions etc that own RIM really really want to sell. Lenovo would make promises of no job losses etc that would answer their big concerns. In Ontario particularly, RIM is a source of pride and it is only if BB10 is a failure that such a sale would be contemplated.

I am a Thinkpad user as well as a BlackBerry devotee. I've always felt that the two devices complement each other well, both aesthetically and in the segment of the market to which they are geared. This makes a lot of sense.

I also think that Lenovo and RIM would be an interesting alliance. Not so thrilled about the idea of a full takeover though, and I rather doubt that's in the cards anyway for many of the reasons previously stated here.

As a longtime Thinkpad user and recommender/supporter for businesses I was skeptical when Lenovo took over IBM's PC division but I must say I've been pleasantly surprised. Lenovo also seems to recognize the power of the "Think" (and particularly Thinkpad) brand has, and is reputedly in the process of creating a separate brand identity for it. (Something like what Toyota has done with Lexus)

Given that Thinkpads have, for a very long time, been associated with the high-end business market, and given that they have typically been "black slabs", and given Lenovo's current slogan ("For those who do"), from a marketing perspective this is almost an insanely obvious pairing.

Here are the sorts of partnerships I think could work:

1) Lenovo becomes the primary manufacturing partner for RIM devices. (Most RIM hardware is made somewhere in Asia, though not as much in China as most electronics device companies)

2) Lenovo creates a line of devices "Powered by Blackberry" etc. Could be smartphones, tablets, etc. Could use this as an initial way of distinguishing their new independent "Think" branding.

I'm not so sure about just licensing the OS - some of the security elements of a Blackberry rely on hardware specifics (ie FIPS 140-2 IIRC is a "full device" certification, not just S/W) so there would need to be some control maintained by RIM over certain hardware details. I agree with others here that full Chinese control of RIM would probably not be productive from the standpoint of security credibility. Even if just licensing the OS there would need to be some protections in place (ie code-signing that would prevent the device from booting if the OS had been tampered-with) in order to maintain RIMs security credentials.

1. NOT GOING TO HAPPEN.
2. QNX would be licensed out, BUT NOT blackberry 10!
3. RIM ISN'T going to be bought out.
4. If blackberry 10 is made by another company, it wouldn't be called blackberry anymore.
5. Partnerships could mean IBM Office suites or other IBM apps will be in Blackberry World.
6. The media scrambles to make up a story even if it's based on half truths, rumors or outright lies.