Buyout could make BlackBerry viable in federal market

New investors could restore BlackBerry's place in the federal market, as the company weighs its options for the future.

By Nicole Ogrysko
Federal News Radio

Once the reigning smartphone of choice for federal employees and corporate business leaders, a now struggling BlackBerry said it’s looking into other options after its new smartphone models failed to spark renewed confidence from even its most loyal customers.

The company announced that it’s hiring a special committee to consider possibilities for BlackBerry’s future, which could include a complete sale of the company or partnerships with private investors.

The possibilities for federal agencies like the Defense Department, which recently gave the go-ahead to the new BlackBerry Q10 and Z10 models, are unclear.

During an interview on the Federal Drive with Tom Temin and Emily Kopp, Tom Suder, founder of government IT company MobileGov, said it’s likely another company will eventually buy BlackBerry, which in the end, could give way for companies to create a new kind of product.

Tom Suder, founder of MobileGov

“For some agencies, there’s a big risk just to leave BlackBerry. That’s been helpful to [the company],” he said. “The longer this goes on, the more pressure they’ll get from their users for different products. I think it would be good that they got bought out by somebody that’s in the market that understands the market, and a good, strategic buy might actually help BlackBerry to be another viable competitor.”

Suder said BlackBerry’s future could depend on what kind of company wants to tap into BlackBerry’s prominence with the federal market. He said a BlackBerry sale could help transform the smartphone into one with both the security and email systems — and user experience features that are more prominent in user-friendly iPhones or Androids.

“Some of the companies that are progressive understand that the federal government is the gold standard of security,” he said. “If you’re doing work with the federal government, that translates to Fortune 500 companies that are around the world.”

Companies like Samsung, Suder said, which has technology developed at the National Security Agency as the basis for its own mobile security system, could express interest in BlackBerry.

This comes as the Defense Department allowed some Android mobile and BlackBerry 10 devices to operate on its networks. Other agencies are considering new mobile device management systems or allowing their employees to “bring-your-own-devices” to cut back on operating costs.

In January, BlackBerry announced BlackBerry 10, a new operating system that was supposed to restore its place in a competitive phone market. But Suder said the move came too late.

“It’s been pretty well documented that they’ve lost the user experience battle, and it’s really hard to come back from that,” he said. “The last phone, if it came out two or three years ago, they wouldn’t be in such a big problem, but … once the momentum starts in the phone market, it’s hard to reverse.”


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