BlackBerry bows out of smartphones with brand-name licensing deal with TCL

BlackBerry crumble complete with TCL smartphone licensing deal

BlackBerry has licensed the rights to its own name to Chinese hardware maker TCL in a deal that will see the company formally bow out of smartphone hardware development and sales.

Under the terms of the agreement, BlackBerry will license its security software and service suite, as well as related brand assets, to TCL. The Chinese company, in turn, will design, manufacture, sell and provide customer support for BlackBerry-branded mobile devices everywhere except Bangladesh, India, Indonesia, Sri Lanka and Nepal.

BlackBerry will, instead, become a pure-play software company, and will continue to develop its security and mobile software packages, while TCL will manage all sales and distribution of mobile device hardware, and serve as a global distributor of new BlackBerry-branded mobile devices along with dedicated sales teams.

The company will continue to provide its own smartphone security software on top of BlackBerry-branded devices running Google's Android mobile operating system.

"This agreement with TCL represents a key step in our strategy to focus on putting the 'smart in the phone' by providing state-of-the-art security and device software on a platform that mobile users prefer and are comfortable with," said Ralph Pini, chief operating officer and general manager of Mobility Solutions at BlackBerry.

"We successfully partnered with them on the DTEK series of secure smartphones and we've been impressed with their excellence in hardware design, development and manufacturing," Pini added.

The licensing deal caps six or so years of sharp and painful decline for BlackBerry, after its market share peaked at around 20 per cent in 2009 and 2010, according to figures from IDC and Gartner, before Android and Apple's iPhone started to eat into its market share and to dominate the whole market.

The company's leadership failed to foresee the impact that the Apple iPhone and Google Android would have on the market with their greater ease-of-use, better features and more powerful operating systems compare to BlackBerry 7 - until it was too late.

The company under the co-leadership of Mike Lazaridis and Jim Balsillie, who disagreed on strategy, had become complacent and failed to recognise the competitive threat until 2010 when it acquired embedded operating system maker QNX in a bid to provide a platform for a next-generation mobile operating system.

Even that acquisition was botched, with no real development for the first year following the QNX takeover. By the time the company belatedly responded with its own BlackBerry 10 operating system it was on the fast-track to irrelevance, with the company's market share having fallen to 2.9 per cent.

Its comeback device, the BlackBerry Z10, launched in January 2013, was insufficiently eye-catching for it to arrest the decline and eye-wateringly over-priced. The best of the 10-series devices, the BlackBerry Z30, likewise was over-priced and failed to catch on.

Furthermore, its shuffle towards Android last year with the Priv device, followed by the DTEK50 and DTEK60 devices this year, was equally too little, too late.

Seasoned tech CEO John Chen, formerly CEO of Sybase and Siemens Pyramid, who took the helm at the end of 2013, sought to breathe new life into the BlackBerry devices business, while diversifying further into software as an insurance policy.