Tue, Nov 11, 2014 - Page 14 News List

BlackBerry eyes China

GAME ON:CEO John Chen said that despite the extremely competitive nature of the Asian market, it holds a lot of potential for smartphone companies

Bloomberg

BlackBerry Ltd chief executive officer John Chen (程守宗) said he is interested in partnerships to expand in China, the world’s largest smartphone market, after meeting the heads of Xiaomi Corp (小米) and Lenovo Group Ltd (聯想).

BlackBerry’s strengths in security, encryption and privacy are in demand in China and there might be opportunities for agreements on technology licensing, distribution or manufacturing, Chen said in an interview yesterday in Beijing, where he was attending the APEC leaders’ summit.

During the summit, Chen said he met with Xiaomi’s chief executive officer Lei Jun (雷軍), and Lenovo’s head Yang Yuanqing (楊元慶). These meetings with China’s two largest smartphone vendors come at a time when BlackBerry is trying to return to growth after declining phone shipments dragged it to net losses in each of the past three years.

Chen said he also met Cher Wang (王雪紅), chairwoman of Taoyuan, Taiwan-based HTC Corp (宏達電).

Chen took the helm a year ago to lead a turnaround after shipments of its smartphones plunged in the past four years as it struggles to compete with touch-screen devices produced by Apple Inc and Samsung Electronics Co. The Hong Kong native outsourced some production, sold property and focused on business customers by bringing back phones with signature physical keyboards and offering more software-based services.

The changes have helped put the Waterloo, Ontario-based company on track for break-even cash flow by the end of this fiscal year and for a return to profit the next year, Chen said.

Last year, there were 19.2 million smartphones shipped with the BlackBerry operating systems compared with 51.1 million units in 2011, according to data compiled by Bloomberg.

The company in September released its new square-screened Passport smartphone which sold 200,000 units in its debut. The device is designed for business users who write e-mails, study spreadsheets and read documents on their phones.

Chen has said that he is already at work on a new concept for devices set to debut next year, including one at Mobile World Congress in March. Another version of the Passport is also in the works, he said.

The company got 16 percent of its sales from the Asia- Pacific region during the fiscal year that ended in March, compared with 19 percent from the US, according to the data.

Now that the company is returning to firmer financial footing, Chen said the China market is one area where he is looking for growth. Out of more than 40 million BlackBerry users worldwide, Chen estimates only a few hundred thousand units have been sold in China.

Chen declined to provide details on the content of his conversations with Lenovo and Xiaomi, He said it is “way [too] early” to be looking for results from the talks in China.

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