I am writing this article speaking as a Blackberry FAN. There are those who do not believe I am a Blackberry FAN because of my "tough love" stance on Blackberry. Therefore, for the record: I have 2 sportscars (admittedly they are known as "the affordable exotics"): a 2009 Mitsubish Eclipse GT V6 Yankee Blue with Spoiler NY Vanity Plate "BBRY"; I also have in the midwest a 2012 Mitsubishi Eclipse Special Edition with 2-tone white/sienna leather Sunset Pearlescent with MO Vanity Plate "BBRY". I have printed up my own design t-shirts which read "Only The Beginning... Z10" and "Back to Black" and yet other t-shirt designs celebrating Blackberry which I won't go into. Is this enough to prove to you I am a true Blackberry FAN? I have had Pearl, Bold, and a couple in the 9xxx series and most recently a Torch 9810 which tided me over until Z10. I have two Z10's actually because I went to the US launch event at Best Buy Union Square New York City and entered a drawing and won another one. That should convince you of my Blackberry fandom.
Now I am going to try again to tell all of you Blackberry investors out there that being a Blackberry FAN does not make wishes come true. This company Blackberry has at best, still, even today, even at the brink of Q10 launch, at best a 50/50 chance of remaining an independent financially viable company and moreover, the shorts are not "crazy" and in my humble opinion there is significant and major downside risk. Let me lay out my reasons pro and con.
(1) The Blackberry US launch marketing effort continues to be weak, ineffective, largely unsupported by the carriers, and unable to clearly target a market segment that is accessible to Blackberry. For several weeks now the Blackberry commercials on US TV have been running that are clearly aimed at young Americans...who are unlikely to have the financial means or the bold stance to sport a device which has largely been buried by the hipsters (oh boy I can see you rose colored-glass wearing Blackberry Faithful jumping out of your chairs and railing at me now!). I'm sorry, that's how I see it. The marketing campaign was non-existent long after it should have been in high-gear but instead Blackberry, in my opinion, opted to cannibalize the marketing budget ahead of earnings report on March 28 so that they could report their what I would call "fake" $98 million profit which was just a hype smoke and mirrors PR stunt.
(2) Thorsten Heins talks about "true mobile computing solutions" etc. but where is it? ASUS is already releasing the "Pad Phone Infinity" which is an Android 4.2 phone which docks into a full-size tablet device. Moreover, ASUS marketing is effective - moving, impressive, beautiful inspiring. That is of course my opinion, you may not share it, but I'd like to ask you, exactly how do you see Blackberry overcoming the Gazillions of dollars of marketing and R&D muscle that Asia Inc. (think Samsung, Acer, ASUS, Lenovo, HTC, etc) has over Blackberry? These companies are poised to put "true mobile computing solutions" onto the market too, just like Blackberry.
(3) The APP Store for Blackberry Z10 continues to be shockingly weak. There are still no United States banks - and I mean, as I have said before, weeks ago, not one, zippo, nada. There are no US banks stepping forward at all to support the Z10 so far. It's been out for months. In late April of this year, Chase Bank, the largest US Bank by assets, announced that they were desupporting ALL Blackberry products. I can't even get Chase bank app on my Blackberry Torch 9810 anymore. Also, there are only one or two Canadian banks with an app in the store, and if you read the reviews of those apps, and I mean the reviews right on the Z10 itself, you will find mixed reviews at best, with many users saying these are just links to mobile sites, not true "Built for Blackberry" apps. This problem of almost no banking apps has been lingering now for months. Nothing is happening on this front at all as far as I can see. The app store has no stock trading apps either. None. Not one, nada, zippo. The app store is full of a great deal of junk apps, and if you don't see that for yourself, with all due respect you must be deluding yourself.
(1) The Blackberry Neutrino Real Time OS (RTOS) also known as the BB10 Operating System is phenomenal. It is a true engineering marvel for the the mobile smartphone market. Stable as a fine watch, never needs to be rebooted, never freezes, never locks up - it is simply amazing.
(2) Built-in CISCO VPN client with group authentication. Together with available bVNC, EricomRDP, and bSSH, I can remote desktop to Windows boxes, Linux desktops, and command line terminal sessions to Linux servers. Very very nice features indeed for an IT professional such as myself. I can reboot Linux servers from my Blackberry Z10; Restart a database on a linux server; address a customer issue on a linux server - all from my super stable Blackberry Z10 which doesn't freeze, halt or lockup ever.
(3) Multiple browser windows and super high score on ring test and html 5 tests. Big win there too.
I stand by my opinion at this point that this product has a very low probability of being a broadly consumed broad-based consumer success. The marketing of it was ineffective and the glaring holes in the app store offerings are going to inevitably lead to returns. Ok, maybe not any higher returns than other phones, since that point is hotly contested by the rose-colored glasses crowd - but not any less than other phones either - and remember - this phone is not considered "hip" in the way that iPhone is considered "hip" by the "hipsters" (I know, I work with the hipsters, and they are not warming up to Blackberry AT ALL - it's not going to happen). I've tried showing them the great OS, the power of the VPN functionality...they don't care they are not interested.
Let's stop on that point a minute. "Why aren't they interested?" I'd say one big reason is that Blackberry continues to cling to the proprietary closed-source OS approach. The Blackberry Neutrino RTOS is not open-source. That is not liked by a large segment of the techo-cognesceti. Do I agree with that dislike. Well, no, not really. I think it's somewhat irrelevant to me personally whether it's open or closed source, but clearly it matters to some people, and it so happens that quite a few of those "some people" happen to be techology trend setters.
So, in closing:
(1) This company has a phenomenal OS that has some kind of future even just purely based on it's watch-like reliability. However, that "future" is not necessarily a "commercial-success-future"; it might very well be a "commercial-failure-future", followed by:
(2) A buyout or total sale of the company and all of it's intellectual property to some other company that has the vision and marketing muscle to take that technology and somehow package or market it in a way that will be commercially viable.
(3) I think the company might be able to hobble along a bit on its strong corporate presence, but I think the employees in those corporations are going to find the Z10, and the Q10 "a bit dull". The phone, as I have said is super reliable, and super-talented in some very key geeky ways - like the VPN I mentioned - but the phone lacks "bling" - it lacks an identity and an excitement - and that is just my opinion. It also lacks a clear consumer market segment that would consume this phone.
That's how I see it. If you'd care to rebut or comment on these statements I welcome all civil opinions. I'd like to see this company survive because I have always liked it and they have always come through for me with products that were critically important to my career and did what I needed when I needed it.
But honestly, I think this company is still very much in the woods, and there are hungry giants out there (Asia Inc.) waiting to either step on them or eat them.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.