I assume you have all heard the phrase, "fighting with one hand tied behind my back." Historians consider that during the American Civil War, the North was fighting with one hand tied behind its back. Meaning, the North had so much manpower and so many resources, it really didn't matter if at certain points in the war it seemed the South was winning. Eventually the North would have won anyway because it had many times the resources, money and manpower the South did. Winston Churchill thought the same about the U.S., before it entered WWII. He knew that if the U.S. entered the war, the allies would win hands down simply because of the inexhaustible resources of the U.S.
Such is the case with BlackBerry (NASDAQ:BBRY) today, but with a twist. BlackBerry did not have one hand tied, but both. Let me explain.
BlackBerry for the past several years did not have a modern ecosystem in order to be able to provide a device worthy of the changes in the smartphone space. Even if BlackBerry was the original smartphone device maker, when Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG) entered the space with their more modern ecosystems, BlackBerry was no match. So for the past several years or so, it has been unable to compete, because it didn't have the tools and guns to do so, because evolution was ahead of it.
However this has now changed. The new BB10 operating system is as good, if not better, than anything else the competition has to offer. BlackBerry also has devices that are as good or better than anything on the market. But even today, BlackBerry still has one hand tied behind its back. The reason is that only recently has BlackBerry's new operating system BB10 and devices been introduced to the market .
While everyone is fixated if the Z10 is selling or not, the point they all forget is that BlackBerry is not just about the Z10. BlackBerry now has a whole host of devices, and each one complements the BB10 OS in its own way. But besides that, the Z10 has only recently been offered in the market and very recently in the U.S.. Give it time, however, and it will eventually take its place in the high-end device space and become a mainstream device.
The Q10 will prove to be BlackBerry's heavy artillery and bread and butter device. The Q10 is the best physical QWERTY in the world by far. In fact, it is the only premium physical QWERTY device period. The Q10 is in a class by itself. Not only for the quality of the phone, but because of the fact that other premium device makers have nothing similar.
For people who are obsessed with productivity and need to communicate often through the day, the Q10 is a no-brainer. Just type BBM and the username and off you are. Don't even bother opening up the application. The Q10 is a CEO class phone for people who do a lot of typing and communicating and don't care about games or how many apps the BlackBerry has. It is a niche product and it is the only premium product of its type. For all those who think BlackBerry is not selling, I just want to remind you that the Q10 has just been rolled out.
The Q5, BlackBerry's emerging markets solution, is sure sell in many of the markets that BlackBerry is mainstream. From South Africa to Indonesia and many other markets around the world, people often forget that BlackBerry is the device to have and to be seen with. One of the reasons why BlackBerry has been losing market share in many of its top markets, is self evident. People wanted a new generation ecosystem and BlackBerry could not deliver. In addition, everyone knew for a very long time that BlackBerry would roll out BB10 and put off buying a BlackBerry device. The Q5 only recently went on sale in June, in the U.S. and selected markets around the world.
Also let's not forget that BlackBerry has announced 6 devices to be rolled out. So far three devices have been delivered. A fourth device, the A10, is rumored to be out in November. While no one knows anything about the A10 yet, BlackBerry has promised that the device will be all about innovation. Give me a break people, with the features available in the Z10, how much more innovation can one add to that? I guess we will see in November.
A while ago, I told you that BlackBerry might drive your next car. Well that might be sooner than you think. On June 5, 2013, at the Telematics Detroit conference, BlackBerry announced a new solution for automakers that lets them manage and deliver "Over-the-air" software updates to vehicles. Leveraging BlackBerry's existing global and secure infrastructure will allow automakers to easily provide software updates to vehicles. In addition, BlackBerry's QNX division has a total solution for managing automotive electronics in today's sophisticated automobiles.
Let's also not forget about BlackBerry's release of BBM for Android and the Apple iOS. We do not know if it will be adopted by the smartphone community as a medium of communications exchange, but as I recently wrote, it will only benefit BlackBerry and not hurt it. How much of a benefit the company will achieve remains to be seen.
And talking about putting up a fight, Bloomberg reported that BlackBerry has just retained the legal services of Steve Zipperstein, who prosecuted failed savings-and-loan associations in the 1980s and investigated the government's siege of the Branch Davidian compound in Waco, Texas, in the '90s. One of his first fights will be against firms like Detwiler Fenton & Co., a Boston-based financial-services firm. Detwiler said in an April report that return rates of the new BlackBerry Z10 were unusually high and in some cases exceeded sales of the phone. I do not believe in conspiracy theories, but all this negative press about BlackBerry and the record short sales in the stock, are just too much of a coincidence.
A week after Zipperstein joined the company, a federal jury awarded Mformation Technologies $147.2 million in a patent-infringement case against BlackBerry. Zipperstein went back to the judge to make the argument that Mformation had failed to meet the burden of proof. Six weeks later, the trial judge overturned the verdict and threw it out. "BlackBerry is no longer an easy target for patent lawsuits," said Zipperstein.
BlackBerry has been fighting a war with a handicap for several years now. Even today, it still has one hand tied behind its back. However with an entirely new operating system and devices that are as good or better than anything else, the competition has to muster, the company finally has a chance to put up a fair fight.
Its second hand will be untied in several months, when the company fully rolls out the Q5 in markets around the world and when the Q10 has had a chance to prove itself in the enterprise space. And with both hands finally untied, only then will there be a "level playing field", and only then will BlackBerry be able to put up a real fight. And when the fight will finally be fair, BlackBerry will eventually win the war and become mainstream once again.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.