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BlackBerry: clinging onto consumers through BBM
BlackBerry’s dire financial results have dominated headlines over the past year, leading to speculation about its future as a business. BlackBerry 10, its latest operating system, has failed to recapture the consumer market, and recent rumors of the company exiting the hardware market, have been circulating. Although it appears that BlackBerry has lost the consumer hardware battle to Apple and Google, there remains one artifact of its original popularity: BBM.
As discussed in the MarketLine Case Study, BlackBerry Limited: Does it have a future in the consumer market?, BlackBerry is looking to continue to leverage its BBM service amongst consumers in spite of its newly announced focus on enterprise customers. Notably, the company has a number of dominant, large-scale competitors in the area of instant messaging (IM), such as Whatsapp, which has recently been acquired by Facebook. However, such competitors have also struggled to monetize their IM operations to a significant degree.
In order to capitalize on the popularity of BBM amongst consumers, and to reduce the impact of its competitors’ popularity, BlackBerry now offers BBM on Apple and Google’s iOS and Android operating systems, and is planning to bring the service to Microsoft’s Windows Phone platform. This has meant that the company has been able to cling onto consumers that have left the BlackBerry ecosystem.
However, merely retaining BBM users does not automatically save the company – far from it, in fact. BlackBerry still faces the challenge of monetizing these consumers that are no longer contributing to the company’s hardware revenues.
BlackBerry has already introduced revenue generating features to its BBM service. BBM channels, a feature that enables the company to accrue advertising revenues under the guise of a new form of social media that occupies a middle ground between Facebook and Twitter. In addition to this, BlackBerry has also introduced the BBM shop, which enables consumers to make in-app purchases of ‘stickers’ that can be used in BBM conversations. These two features are, ostensibly, consumer focused initiatives. Although some may question their tangible benefit to consumers, BBM Channels and the BBM Shop undoubtedly reflect BlackBerry’s intentions to retain at least a modicum of presence within the consumer sector.
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