At the Blackberry AGM, a plead for a steady hand
Blackberry’s shareholder annual general meeting was an uneventful affair, as CEO Thorsten Heins pleaded with shareholders to allow him to rebuild the company slowly with a steady hand and launch new services like BBM on competing smartphone platforms.
Blackberry’s annual general meeting for shareholders, held Thursday in Waterloo, Ontario, ended with a slight bump in the company’s share price.
While the event itself wasn’t dramatic or memorable — there were no motions for a breakup of the company or coups against the board of directors — this positive bump in the company’s share price shows the mood of shareholders is improving if ever so slightly.
At the AGM, CEO Thorsten Heins outlined said Blackberry is on the road to recovery and traversing that road will take some time.
“We are still in the midst of a major transformation of this company,” Heins said. “This is a long-term transition for the company but I can assure you we are pushing very, very hard to show these improvements.”
Heins said that Blackberry’s turnaround plan is divided into three stages: fix, build and invest, and finally benefit. According to Heins, Blackberry is currently in the second stage of its turnaround plan which is “all about building scale for our products and solutions.”
He did not give a timeline as to when the company would hit the third stage of his plan, or delve into specifics as to what the plan might entail to get to the goal of returning to profitability and attaining a “leadership” position in mobile computing.
Don’t put all the eggs in one chat app
At the meeting Heins said that BBM was on track to be released on Android and iPhone this summer. This summer will also see the launch of Blackberry channels that will allow businesses to push out data to consumers that have opted-in.
If BBM on Android and iPhone and BBM Channels are a pillar of Blackberry’s turnaround plan, unfortunately for the company it’s going to be too little too late. While BBM might have been the go-to chat app 3-4 years ago, there are now a plethora of competitors that have a bigger market share than Blackberry could ever dream of with BBM. Without a miracle or revolution, there is no way that BBM can compete with established players like LINE, WeChat, or WhatsApp.
For Blackberry to succeed with the re-birth of BBM it needs to add more monetization channels and features than just plain old chat. Both Line and WeChat offer free and paid games; some apps like WeChat offer a “who’s near me” feature that turns into an ad-hoc dating service. While Blackberry’s business-set customer base may have no need for these youth-aimed features, BBM won’t grow unless it can integrate more features than just chat.
Late Thursday, the Wall Street Journal reported that Richard Piasentin, the company’s US managing director, had been fired and a large number of layoffs were in the works.
There aren’t many ways to put a positive spin on the US launch of the Blackberry Z10. It took place after the launch of the phone in many other major markets, and when the launch occurred it happened without a prominent spectacle that the company certainly would have liked.
Blackberry put part of the blame on the low-key launch on carriers, who displayed much more advertising for Samsung and Apple phones than Blackberry during the launch week.
These layoffs and the firing of Piasentin could be Heins sending a signal to investors that there is still fat to cut from Blackberry to ensure a return to profitability. While layoffs might be necessary when the company is unprofitable, it will be hard to build, invest and grow the company’s profits — that will return it to profitability — without human capital.
Blackberry’s stock closed up at $9.64 at the end of the Tuesday trading day.