BBM Is Worth More To BlackBerry Integrated Than On A Standalone Basis

| About: BlackBerry Ltd. (BBRY)

BlackBerry (NASDAQ:BBRY) got a boost recently - if one wants to call it that - because of Facebook's (NASDAQ:FB) buyout of the text messaging service WhatsApp.

Granted the $19 billion price tag was a shocker and very few (if any) can come up with a formula to justify this price, but on the other hand, Facebook paid most of the money with its over-inflated stock, so Facebook probably paid a fair price. So two bubble companies joined in holy matrimony, and the product of this union is one big bubble stock.

Now the obvious question is, if WhatsApp is worth so much, how much is BlackBerry's BBM text messaging service worth? Well if one calculates the value based on the number of users etc, the value of BBM is around $3.3 billion.

However, in order for BlackBerry to be able to get this price, someone must come in and put a bid for the service and buy it. And because the text messaging space is already overcrowded, I doubt this will ever happen. So we cannot really put a price on BBM, unless we have evidence to believe that BlackBerry was going to spin it off.

But not only does BlackBerry have no plans to spin BBM off, it will probably integrate BBM as part of BlackBerry's enterprise offering more than ever.

Ever since executive Vice President of BBM Andrew Bocking left BlackBerry, everyone has been wondering what the fate of BBM will be, since he was one of the persons responsible for its evolution.

However since John Chen put John Sims in charge of BBM, things have become more clear. See Sims is the new head of Global Enterprise Solutions. What this might mean (in my book) is that Chen want Sims to steer BBM toward the enterprise, and not for BBM to become just another consumer text product.

See, at the moment there is no dominant secure enterprise-grade messaging platform. And since John Chen has promised to return BlackBerry to its roots - the enterprise - one might guess that BBM in the future is destined to become more of an enterprise messaging platform than simply a text message app for the masses.

To me this makes perfect sense. Imagine for example a BBM backdoor desktop application that can import thousands of phone numbers and names from an MySQL database for companies to be able to send thousands of messages to their employees or friends on a daily basis, based on a certain set of criteria.

Imagine for example a secure messaging platform that can send text information to thousands of military or government personnel instantly.

I mean if I start brainstorming of all the possibilities that a secure enterprise text messaging platform might be good for, I will probably stop writing next week.

The bottom line is that BBM is worth more to BlackBerry as an integrated part of BlackBerry then selling it off as a standalone platform that might (or might not) have a chance to compete against WhatsApp or any other messaging platform.

There is a market for secure enterprise messaging systems, and BlackBerry can charge an arm and a leg for it, if it plays its cards right.

So for me, BBM is worth much more that $3.3 billion if BlackBerry continues on the enterprise path that it has embarked upon, and finds ways to sell BBM to the enterprise as part of a host of communication services that companies have come to expect from BlackBerry.

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.

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