Can BlackBerry’s new tech unit save the day?

BlackBerry has announced a new business unit that will hold its key technology assets.

BlackBerry has appeared to have lost in the smartphone market when compared to market competitors such as Apple and Samsung. As for tablets, the PlayBook failed to attract the loyal customer base of Apple and Android rivals. The company has been lagging behind in many respects for a while – so the news that it is combining its technology into a single business asset marks an intriguing change of direction.

What’s happening?

BlackBerry announced on 18 August that it has created an entirely new business unit that will house key tech projects including its Certicom cryptographic applications, QNX embedded software, antenna tuning system Paratek and the Project Ion connectivity platform. BlackBerry Technology Solutions will also become home to all of the firm’s 44,000 patents and a number of significant software projects.

Sandeep Chennakeshu, a former chief technology officer at Sony Ericsson with more than a quarter of a century’s experience in the tech sector including wireless and semiconductors, will captain the ship.

“Combining all these assets into a single business unit led by Sandeep will create operational synergies and new revenue streams, furthering our turnaround strategy,” said BlackBerry chief executive John Chen.

He added that the projects that will move into the Technology Solutions unit all carry strategic importance for the firm, while its patent portfolio is significant for a number of different industrial sectors.

What’s in it for BlackBerry?

Ultimately, it allows the company to focus more closely on some of its key assets. By bringing them under the same roof BlackBerry is turning its new unit into an incubator of sorts for the projects with the best potential. If it allows cross-pollination between projects to improve product and service quality, so much the better – after all, these are the projects that Mr Chen believes will keep the firm relevant in the next few years.

BlackBerry is trying to reposition itself in the technology sector. The firm clearly knows that it has lost a substantial portion of its lucrative corporate customer base after network failures and other embarrassing fiascos damaged the credibility of its handsets over the past few years.

The projects that it has in development indicate that it has finally given up on individual consumers and is focusing more on what it can offer companies and governments. To that effect, it’s already had to make serious changes, having lost as much as 40 per cent of its workforce last September alone.

Where next?

BlackBerry is trying to develop its standing away from smartphones and tablets. That is likely to mean a much broader range of products in the future – previous chief executive Thorsten Heins was pointing to a world beyond the phone before he was replaced – but will begin with updated programs to handle cybersecurity among a host of other measures.

Success for BlackBerry will depend to an extent on how badly its reputation has already been damaged, but the quality of the products will be just as important. Project Ion, for example, will meet a growing demand as the Internet of Things expands at an exponential rate in the coming years. Constant fear of cyber-attacks will ensure that cryptographic software becomes more and more important. BlackBerry knows that there’s a market for its new batch of projects. Reaching them is the next challenge.