Blackberry To Stop Production Of Phones

It will be an end to a glorious era for BlackBerry as the company announced on Wednesday that it would halt in-house production of smartphones.

The once-dominant Canadian tech firm has announced a joint venture with an Indonesian telecom company that will start to manufacture the phones, which will still have BlackBerry’s look and feel.

BlackBerry CEO John Chen says the company will prioritize software development, including apps and security.

“We are reaching an inflection point with our strategy,” Chen said in a statement. “Our financial foundation is strong, and our pivot to software is taking hold.”

The Canadian company made the revelation during its second-quarter earnings report.

Chen said earlier this year that he would know by September whether the loss-making handset business was likely to become profitable.

John Jackson, analyst at IDC, said BlackBerry’s decision to stop making devices was “entirely sensible and probably overdue”.

He added: “Software revenue and the margin profile associated with that is where the focus should have been, and now can be.”

Also speaking, Colin Cieszynski, chief market analyst at CMC, said:

“Today marks a big transition for BlackBerry and the end of an era for the company. The company plans to shift its focus fully to communications and security software development, reducing capital requirements and increasing margins.”

Some analysts praised the decision to get out of smartphone sales, at a time when the worldwide smartphone market has turned relatively flat.