Shortages of BlackBerry Passport a good sign for the smartphone maker

'I’m glad to have inventory issues. It shows that people want the phone,' said chief John Chen.

Shortages of BlackBerry’s Passport smartphone indicate that efforts to turn around the unprofitable company are taking hold. Aaron Harris / Reuters

It is a good thing that some people cannot buy BlackBerry’s Passport phone, according to the chief executive, John Chen. That means it is popular.

Shortages of the business-focused smartphone show that efforts to turn around the unprofitable company, formerly known as Research In Motion, are taking hold, Mr Chen told an MIT Enterprise Forum event in Hong Kong.

Demand for the phone – the first major new device released globally since Mr Chen took charge last November - has exceeded the Canadian company’s expectations.

“I’m glad to have inventory issues. It shows that people want the phone,” said Mr Chen.

“We took a very conservative approach and didn’t order too many.”

In his attempt to return the company to profitability by 2016, Mr Chen is focusing on products such as the BlackBerry Blend feature that appeals to corporate customers because it helps them merge work and personal information.

BlackBerry’s smartphone shipments sank to 13.7 million units last year from 52.3 million in 2010, according to data compiled by Bloomberg, as it struggled to compete with touch-screen devices produced by Apple and Samsung.

The Passport pre-sold 200,000 units in the first two days, selling out in six hours on BlackBerry’s website and within 10 hours on Amazon.com.

The square-screen smartphone is designed for business users who write emails, study spreadsheets and read documents on their phones.

BlackBerry was focused on the 30 per cent of the market that regards their phones as a tool, not as an entertainment portal, Mr Chen said.

“That is not a space that we can afford to be in now. Being sexy and being a workhorse are two different things,” he said.

Mr Chen, a Hong Kong native, said he does not yet have a strategy for expanding into China. The company recorded 16 per cent of its sales from the Asia-Pacific region during the fiscal year that ended in March, compared with 19 per cent from the United States, according to data compiled by Bloomberg.

Mr Chen said he hopes to get ideas when he attends the Asia-Pacific Economic Cooperation summit in Beijing next month, his first trip to the country as the chief executive.

“China is too big a market to ignore,” Mr Chen said.

“It is clear that BlackBerry needs to and should be in that market.”

Shares of BlackBerry rose 2 per cent to $9.49 at the close in New York on Friday.

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