BlackBerry made some waves Monday by announcing that it is officially looking at strategic options, including a sale of the company. You know they're serious because director Prem Watsa, head of insurance company Fairfax Financial and one of BlackBerry's biggest shareholders, excused himself from the board in order to avoid a potential conflict of interest. In other words, Fairfax may also be invested in a potential BlackBerry buyer. The question everyone is asking now is who might buy the beleaguered, Waterloo, Ont.-based smartphone maker. The more intriguing mystery, in my books at least, is why one of those potential suitors - Microsoft - hasn't bought BlackBerry yet? The logic is pretty solid. Android and Apple have run away with the smartphone market, with the Canadian company clutching at a distant and declining third-place slice. The latest numbers say the company has indeed lost that spot to Microsoft and its Windows Phone.
That’s not cause for any excitement – these are low, single-digit scraps we’re talking about. Android and Apple have about 80 and 13 per cent of the market, respectively. (As an aside, it’s funny how those numbers are starting to look like the historical division between Windows and Mac computers, huh?)
So what’s the fastest and easiest way for a company to make its anemic market share bigger? It doesn’t take a mathematician to figure out the answer: combine it with somebody else’s equally anemic share into something with a little more meat on its bones. Putting BlackBerry and Microsoft’s Windows phones together would amount to almost seven-per-cent share. That’s still small, but it’s almost within striking distance of Apple.
More importantly, Microsoft – through an acquisition – would eliminate its biggest obstacle. In some countries, especially Canada. BlackBerry still enjoys decent success as the de facto third brand that buyers gravitate to because they’re loyal and/or hate Android and Apple. By most accounts, Windows Phone sales are extra anemic to non-existent in these markets as a result.
Take the recently announced Nokia Lumia 1020 as an example – it’s coming to the United States and United Kingdom, but there’s no word on when or if it’ll even see store shelves in Canada.
There’s also a lot of potential synergy for Microsoft with BlackBerry. Tablets, smartphones and even Macintosh computers are eating away at PC sales, with the primary buyers of Windows-based computers being businesses. You know, the same client base that BlackBerry caters to.
The catch is that Microsoft seems adamant on pushing Windows on users, but it’s becoming increasingly clear the company needs to rethink that approach. BlackBerry could represent a new route into the future and out of the past for Microsoft, but still a relatively safe one since it would be starting out with the same sort of customers.
Lastly, there’s also the tremendous value of BlackBerry’s intellectual property and patents. Having those would give Microsoft an even stronger base from which to defend against any potential legal actions from competitors.
Sure, there would be some issues with the acquisition. Other than figuring out how to integrate BlackBerry within the Windows ecosystem (my vote is obviously to start replacing Windows entirely), there’s also the question of what would become of Microsoft’s partnership with Nokia.
Still, the reasons for seem to outweigh the reasons against.