These are tough times for BlackBerry. The Canadian company has hung a “for sale” sign over its global business, announced a recent US$1 billion loss over a three-month trading period, and is subject to a controversial “rescue” takeover bid from one of its existing shareholders.
Meanwhile, its share of the global smartphone market continues to dwindle in the face of heavyweight competition from Apple and Samsung.
Some analysts say BlackBerry, once the mobile brand of choice for everybody from investment bankers to streetwise teenagers, is in terminal decline.
But that is not how Nick Horton sees it from the viewpoint of Dubai Internet City, where he runs BlackBerry’s Middle East and North Africa business.
“There have been lots of distractions because of the global situation, but we’re putting in a strong performance in the Middle East and we remain focused on it. It’s definitely a three-horse race here,” he says, in reference to the company’s big two rivals from the United States and South Korea.
He reels out statistics to back up his belief, such as the annual survey of the UAE's Telecommunications Regulatory Authority that states BlackBerry had two of its devices in the top 10 sellers in the Emirates.
Another industry survey, by the German market research agency GfK, puts BlackBerry at number three in the UAE and the broader region, but at number two in the big Saudi market.
BlackBerry apps have proved to be particularly popular in the UAE and Saudi Arabia, Mr Horton says. “BlackBerry is bigger than Apple in many parts of the region. We’re competing strongly,” he says.
Why is BlackBerry, to some degree, bucking the global decline with its Middle East business?
“People here are very brand-conscious, and BlackBerry is still a significant brand that appeals across the region. In particular, BlackBerry Messenger [BBM] appeals to the social nature of consumers in the UAE and across the region, and will prove more popular when it’s available on Android and iOS systems,” he says.
There is no date yet for BBM’s launch on these systems, used by its main rivals, after technical problems delayed an earlier start. But BBM has proved to be one of the enduring features of BlackBerry’s popularity in the region. In the UAE, 98 per cent of all BlackBerry customers make use of the free messenger service.
The focus in the region is three-dimensional, Mr Horton says. First, to continue to exploit BlackBerry’s traditional customer base at the top end of big corporations and financial institutions, what it calls the “enterprise segment”.
That requires persuading IT departments at these big firms to upgrade to the new BB10 system launched this year and to supply new handsets to employees.
The second focus is known as the “bring your own device” market – BYOD in telecoms jargon. This has been a problem for BlackBerry elsewhere in the world, with big Wall Street banks, in particular, increasingly allowing employees to make their own choice of smartphone, which in the US usually means an Apple device.
“We don’t have any specific details on BYOD in the region, but we do know that existing customers are upgrading to BB10 on the BlackBerry Enterprise Server, our corporate service,” he says.
He also says that big UAE customers like Emirates NBD, Emirates Airline and Dewa have upgraded to BB10 or are considering doing so, as well as other big regional names like Saudi Aramco and Qatar Airways.
The third focus is that part of the consumer market that “values productivity”, as Mr Horton explains it, “from the chief executive to the student, people who want to use BlackBerry productively”.
Regardless of what is happening back in its Ontario HQ, Mr Horton – just a month into the Middle East job after some years running South East Asia operations from Singapore – has plenty to keep him busy.
The new Z30 device launched recently and will be heavily marketed at the imminent Gitex exhibition in Dubai; BlackBerry is preparing for its sponsorship of the Mercedes team at the Abu Dhabi Grand Prix; and the Canadian singer Alicia Keys, a “global creative director” for BlackBerry, will be performing in Dubai later this year.
Some analysts would question whether BlackBerry will still be around as a independent entity for these events. A takeover bid by its 10 per cent shareholder Fairfax Financial remains at the stage of “due diligence”, but the bid faces problems. Simultaneously, the BlackBerry board under chief executive Thorsten Heins is conducting a strategic review that many believe will end up in the sale or break-up of the company.
Esprit de corps at BlackBerry took a knock recently with the announcement of 4,500 job cuts. “None have taken place in the Middle East yet, but we cannot rule it out,” says Mr Horton.
His job now is to keep the Middle East operation working smoothly despite the volatility and controversy elsewhere.
“It’s a management challenge, making sure we retain strong relationships with our partners and stakeholders. The stuff being written elsewhere is a distraction. But there are lots of positive things happening in the Middle East and we will continue that story.”
fkane@thenational.ae
