Why Apple Will Buy BlackBerry

Oct. 30, 2013 9:46 AM ETBlackBerry Limited (BB)138 Comments
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Rizzi Capital

BlackBerry (BBRY) was once the most popular smartphone maker in the world. But things did not last long. The company is now a money bleeding mess, having lost almost $1 billion last quarter alone, with revenue dropping by 45%. It's a sad story for what was once the most valuable company in Canada. But there will soon be a happy ending, sort of.

BlackBerry gained it's massive following not because of it's appeal to regular consumer users, but because it was the communication device of choice for millions of corporate users. BlackBerry focused on delivering secure communication services over its private enterprise server network and this allowed it to win over enterprise customers worldwide. This is exactly the same technology which will come to its rescue again and it's the precise reason Apple Inc (AAPL) will soon see fit to enter negotiations to purchase the company. The blogosphere and many corporate analysts have been speculating about this union for a while, and I think now is finally the moment of truth.

Let's make one thing absolutely clear, Apple does not need to buy BlackBerry. Apple has it's own iMessage service which is comparable although not identical to the BlackBerry messaging service. It can be argued that most services offered by Apple are already better and in fact more established than those offered by BlackBerry. Regardless of this, there are some very compelling reasons for Apple to spend a tiny fraction of its immense cash hoard and buy this once great company.


The main reason that Apple should buy BlackBerry is simply to keep it out of everybody else's hands. Does Apple really want to see Microsoft (MSFT), Amazon (AMZN), Facebook (FB) or Google (GOOG) takeover BlackBerry and gain an instant position in the

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Rizzi Capital is an independent wealth management partnership specializing in value investing to maximize return. We operate a long/short fund with zero leverage and invest mainly in Canadian companies.

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