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BlackBerry outsourcing smartphone design in strategic shift

t was supposed to be the phone that saved BlackBerry – but the firm said IN July that it would stop making its Classic smartphone, less than two years after launching it with much fanfare.Ralph Pini, the company’s chief operating officer and general manager for devices, said the Classic has long surpassed the average lifespan for a smartphone in today’s market. ‘We are ready for change so we can give our customers something better,’ said Pini in a company blog post.

The BlackBerry Classic hit the market in December 2014.It offered customers a 3.5-inch (88.9-millimeter) screen, which was 60 percent larger than the previous BlackBerry Bold 9900. It also had longer battery life and a standard keyboard and touch screen

Handsets with the BlackBerry name will be produced under license by PT Tiphone Mobile Indonesia Tbk, allowing the Canadian firm to concentrate on software and services, a statement by the firms said.BlackBerry will take a royalty on devices sold by the Indonesian firm.

‘We are reaching an inflection point with our strategy. Our financial foundation is strong, and our pivot to software is taking hold,’ said chief executive John Chen, pointing to a doubling of software revenue over the last financial year, reports AFP.’The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,’ said Mr Chen.

BlackBerry, which a decade ago was among the largest smartphone makers, has seen its global market share slip to less than one percent amid domination by Apple and Android devices. As the market shifted, BlackBerry has shifted its focus to software, including security applications, and the latest announcement takes the company out of the handset market entirely. It had hoped its first Android-operating smartphone launched last year would help restore the company to its former glory but the handset wasn’t a big hit. Earlier this year, BlackBerry announced that it was killing off its Classic smartphone with a physical keyboard – once the workhorse of the smartphone market – in order to modernise its lineup.

The oddly shaped BlackBerry Passport, which launched in 2014, was met with a mixed response largely thanks to its odd dimensions. In 2013, the company unveiled its long-awaited BlackBerry 10 software alongside the Z10 handset, but the both were already way behind their iOS and Android rivals by the time they were ready to launch. Ernest Doku, mobiles expert at uSwitch.com, said: ‘In spite of a small yet loyal-to-the-death contingent of fans, BlackBerry simply couldn’t survive a market dominated by two mobile behemoths’

‘BlackBerry addicts will no doubt be gutted by the news, but this is one mobile maker that just made too many mistakes,’ he added.While BlackBerry has already started outsourcing its smartphone manufacturing, it will back out entirely by the end of the year, Chief Executive Officer John Chen said on a call with analysts, reports Reuters.

Article source: http://www.dailymail.co.uk/sciencetech/article-3811575/BlackBerry-stop-making-signature-smartphone-revenue-slumps.html

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