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Chris Lau

BlackBerry 'Mercury' a Hit

BlackBerry said “Mercury,” the company’s last in-house designed Android, received good reviews. Per posted by BlackBerry:

The reception to Mercury was strong. The publications Android Central, Phone Scoop and Android Police all gave BlackBerry Mercury “Best of CES” awards.TechCrunch praisedits “solid feel coupled with a modernized version of the iconic BlackBerry design.”Mercury was also a finalist in Engadget’s BEST of CES awards (we should also mentionDTEK50 won an Innovation Award from the CES organizer itself).

Positive reviews from mainstream Android sites will not translate to higher device sales. TCL will need to do what it does best: promote the phone’s features and securities to the retail channels. DTEK70/Mercury is a step forward in the company’s Android device evolution. It has better keyboard aesthetics than the PRIV and takes more of BlackBerry’s “Classic” or “Bold” design.

Moving manufacturing to TCL removes the operating costs associated with hardware development. BBRY holds no inventory and does not need to manage the unit volumes in the channel.

BBRY paid up to $100M on getting TCL as the lead for hardware and now software. It must recoup the cost through higher unit sales. Since businesses demand both higher security and productivity, the BlackBerry Android operating system paired with a physical keyboard-based device should find some success.

  • 25 25 correctly predicted forecasts
    Max Grigoryev
    Do you think it can help BBRY to improve their financials? I have some concerns about the margins
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  • Beaver
    Hi Chris, can you please clarify the first sentence in your last paragraph, "BBRY paid up to $100M on getting TCL as the lead for hardware and now software. It must recoup the cost through higher unit sales."

    BBRY paid TCL up to $100M???

    Thanks.
    Reply
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  • 18 18 correctly predicted forecasts
    Chris Lau
    Beaver, BBRY said:

    "This reflects a use of free cash of $154 million, which includes $150 million of cash used in operations. The majority of cash used in operations was attributable to working capital and supplier purchase commitments related to transitioning the device hardware business to a software licensing model. "
    When you look at other write-downs and obligations, it's an estimate of the one-time total cost of the transition.
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  • Beaver
    Thanks Chris.
    So you're saying BlackBerry wrote off $100M when transitioning from hardware to software and licensed TCL.
    Reply
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