BlackBerry CEO John Chen spoke with candor this morning on the earnings call about the next phase in BlackBerry's licensing strategy. In particular, he mentions one of the company's partners is very excited to build a tablet based on Android. He clarifies this is part of an expansion phase of the software licensing program.
Chen notes that this phase will focus on a broader set of endpoints and will extend into co-branded hardware to address Internet of Things and Enterprise of Things devices.
"We are now expanding to the next phase of our licensing program. This will focus on a broader set of end points. What this MIGHT mean and I make no promise, is that you may soon see a BlackBerry tablet and it will also extend into co-branded handsets and IoT and EoT devices. These end points will run on our software and security features and be co-branded 'Secured by BlackBerry'."
Chen expands on his point giving further context on the structure, and where BlackBerry will get value from the deal. The recurring revenue model exists here under a royalty stream, but again he clarifies on the tablet front that it's not a 100% committed thing as of yet.
"One of our partners are very excited to build a tablet based on Android, and so they wanted us to give them the portfolio rights to do that. I'm interested to do that because I'm going to get royalties for every tablet they ship. I will just leave it at that, and it's not even that, we have to curate it, we have to do a lot of things on with it, so it's not a 100% committed thing but it's gonna come from our partners and BlackBerry will only receive royalty but it's using our software and we do the QA and portfolio management, so I hope that clarifies that point."
Chen explains his point with some acknowledgment to the task itself. BlackBerry has remained highly involved in these deals to validate that the security is in place and that these branded devices meet the quality assurance standards befitting the brand name.
Secured by BlackBerry is an interesting branding move that will allow BlackBerry to be more flexible with its licensing arrangements across hardware and software. Catch up on the rest of the earnings call by checking the replay.
From Smartphones to Smart Enterprises, BlackBerry Expands Licensing Strategy for the Enterprise of Things
Mar 31, 2017 - WATERLOO, ONTARIO--(March 31, 2017) - BlackBerry Limited (NASDAQ:BBRY) (TSX:BB) today shared new details on its broad licensing strategy which addresses the growing need for secure, connected devices and endpoints in today's Enterprise of Things.
The first phase of BlackBerry's strategy, announced in September 2016, was focused on providing the most secure and comprehensive Android software for smartphones around the world manufactured and marketed by TCL Communication, PT BB Merah Putih and Optiemus Infracom Ltd. The company is now pursuing additional endpoints which could include tablets, wearables, medical devices, appliances, point-of-sale terminals and other smartphones.
"There is an incredible opportunity for connected devices to improve lives, but to realize its full potential, privacy and security must be embedded in every end point from the start. For example, companies providing medical monitoring devices must protect health data on the device, guarantee it connects securely to the healthcare system, and most importantly ensure that it cannot be hacked, BlackBerry Secure helps solve this triple threat," said John Chen, Executive Chairman and CEO, BlackBerry. "We have taken a long-term and thoughtful approach to our licensing strategy, which includes an expansive view of the entire Enterprise of Things ecosystem. As part of this strategy, we will work with a wide range of manufacturers to integrate BlackBerry Secure software into both BlackBerry-branded and co-branded devices."
About BlackBerry
BlackBerry is a mobile-native security software and services company dedicated to securing people, devices, processes and systems for today's enterprise. Based in Waterloo, Ontario, the company was founded in 1984 and operates in North America, Europe, Asia, Middle East, Latin America and Africa. The Company trades under the ticker symbols "BB" on the Toronto Stock Exchange and "BBRY" on the NASDAQ. For more information, visit www.BlackBerry.com.
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