A tentative deal to take BlackBerry private will not necessarily resolve challenges that pushed the smartphone maker into a corner in the first place, but it gives the struggling company some breathing room.
Private or public, BlackBerry’s problems remain the same: slumping market share, mostly uninspiring devices and cut-throat competition threatening the state-of-the-art security of the BlackBerry network.
“It potentially buys the company time, analyst James Cordwell of Atlantic Equities in London said of Monday’s proposal from Fairfax Financial Holdings. “What it doesn’t solve is, what’s the long-term strategy for Blackberry.”
BlackBerry virtually created a lucrative professional market for email devices, but rivals have muscled in and Apple’s iPhone has set a new gold standard for consumers.
On Friday BlackBerry warned of slumping sales and a big operating loss, and on Monday it said it had accepted a US$4.7 billion offer from a consortium led by Fairfax Chief Executive Prem Watsa.
BlackBerry accounted for just 2.8 per cent of worldwide smartphone sales in the first half of this year, down from 5 per cent last year, and 11 per cent in 2011, according to IT research firm Gartner. The company has lost the “cool” factor that once made it indispensable in Britain and elsewhere.