July 24, 2014 3:30 pm

BlackBerry looks to partnerships to compete with Apple and IBM venture

BlackBerry Z3©PR Photo

BlackBerry sales have plunged in recent years

BlackBerry is in talks with rival technology groups about partnerships to compete with the newly forged alliance between Apple and IBM.

John Chen, chief executive, said the Canadian technology group was in early discussions with companies about working together in parts of the enterprise market. He declined to comment on which companies were in discussions.

Shares in BlackBerry fell almost five per cent last week after IBM said it would work with Apple to sell iPhones and iPads loaded with applications for business users. The tie-up was seen by analysts as a direct challenge for customers that use BlackBerry’s enterprise services.

BlackBerry stakes out business customer

John Chen, chief executive of BlackBerry

Chief executive John Chen tells the FT the smartphone maker is out of danger and he is preparing to reclaim the business market

IBM is planning more than 100 apps targeting industries such as retail, healthcare, banking, travel, transportation and telecommunications, with a focus on security and mobile device management.

Mr Chen has also focused BlackBerry on driving enterprise sales in similar areas since joining as chief executive last year, using its market leading security software combined with devices, servers and messaging services.

Mr Chen said that the partnership between Apple and IBM was both good and bad news for BlackBerry. He likened the tie-up to when “two elephants start dancing”, adding that it would be interesting to see how they worked together given both companies “are used to taking charge”.

“The IBM-Apple tie-up validates what is a huge market,” he said. “[But] the bad news is that you are waking up two giants. It’s competition but it’s good competition and we are going to be more nimble. You don’t want to be a strong guy in a market that is not growing.”

Mr Chen said that BlackBerry was in talks about its own partnerships. “I am working on some, and maybe we will collaborate with others. If I focus on security and identity management then we will be a good solid partner in this enterprise world.

“I am not afraid of competing when I know I am more nimble. I never think [that] going alone is the right strategy. But we have a value add that no one else can do.”

Mr Chen said that BlackBerry was out of danger having almost completed its restructuring. BlackBerry will focus on enterprise customers rather than the consumer business for now, said Mr Chen.

Consumer sales of BlackBerry phones for have fallen, with less than 2 per cent market share in many Western markets, according to Kantar, the research group.

Mr Chen said that even forthcoming handsets such as the square-shaped Passport – which is expected to be released in September – were geared towards being used by enterprise customers in core “regulated industries” such as financial services and healthcare.

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