) Historical & GeographicalLocation: In current time (past years and ongoing) demand for BlackBerryhardware i.e. phones have decreased sharply because of the advent ofsmartphones.
In 2012, BlackBerry reported device sales of 11.1 million units,however a year later in 2013, this had plummeted to 6.0 million. In 2014 it sawa drop to 3.4 million, continuing in 2015 and 2016 with the latter reportingjust 0.6 million sales worldwide. 2) Chronicle of the event: BlackBerry’srevenues from its Mobility Solutions segment have declined fast BlackBerry’s(BBRY) chief executive officer John Chen had announced last year that he wouldconsider making a strategic decision about its hardware business if itsfortunes don’t improve this year. A strategic decision could mean a sale orspin-off or simply the closure of its hardware business.
Fortunes have notimproved. BlackBerry formed new business units—Mobility Solutions, ServiceAccess Fees and Software and Services. Basically mobility Solutions willconsist of revenues from hardware sales and device software licensing programs.BlackBerry’s revenues from Mobility Solutions fell 44% last fiscal quarter from$269 million in fiscal 1Q16 to $152 million in fiscal 1Q17. 3) Breakdown of the event: First, BlackBerry’s telecom partner AT&T(T) criticized the company’s flagship smartphone, Priv, of “struggling” withits sales, according to a report from CNET.
Then, the U.S. Senate announcedthat it will no longer procure new smartphones from BlackBerry. This was a bigblow for BlackBerry, as the company has largely depended on government bodiesfor its smartphones sales since governments value the security aspect ofBlackBerry devices. However, with Apple’s (AAPL) iPhones and Samsung (SSNLF)improving their security features, BlackBerry lost that competitive edge aswell.
4) Consequences of the event:BlackBerry’s smartphones sales continue to decline to top it all off,BlackBerry announced that it will discontinue sales of its Classic smartphone.The decision to axe the Classic smartphone was surprising. BlackBerry hadpartnered with all major US telecom providers—AT&T, Verizon (VZ), andT-Mobile (TMUS)—to sell the Classic. Although the Classic used a dual core 1.5GHz Qualcomm (QCOM) Snapdragon