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There are a lot of reasons an acquisition of BlackBerry by Korean tech giant Samsung makes good sense, as my colleague Todd Weiss has pointed out.
BlackBerry has the loyalty of business and government customers worldwide, for one thing. The company also has patents covering security, encryption, the Internet of things (IoT) and even wearable technology that could prove critical to Samsung as it strives for global dominance in the smartphone market.
However, both companies have said on more than one occasion, including most recently on Jan. 15, that they’re not getting hitched. These rumors and their subsequent denials have sent BlackBerry stock onto the valuation roller-coaster, likely to the delight of lucky stock speculators, but probably not to anyone else.
But you’ll notice that BlackBerry didn’t deny that it was in some kind of merger talks; the company just denied that they were with Samsung. Could that mean that BlackBerry is talking to another company? At this point, unless you’re hiding in the closet in CEO John Chen’s office, it’s impossible to know. But it might be possible to figure out if you look at some diverse facts about the business of the company and its possible suitors.
When you consider how BlackBerry does business, the list of suitors shrinks significantly. In fact, if it’s not Samsung, the only real likely suitor is Apple. So is it possible that Apple is quietly talking to BlackBerry? Good question, but it might make sense.
First, take a look at why it’s almost certainly not some other company. Other than Korea’s LG, most of the other phone makers either come from China, Japan or the United States. If BlackBerry were to be bought by a Chinese company, it would dramatically limit the organizations that would be customers in much the same way that the range of customers for ThinkPad laptop computers shrank when Lenovo bought the brand.
The range of customers dropped because a number of government buyers in the United States and elsewhere will not own Lenovo computers for any type of sensitive data. The same is true for Motorola cell phones now that Lenovo owns Motorola. The same situation exists for other Chinese companies.
The problem is that governments, including the U.S. government, and corporations with strong security requirements are some of BlackBerry’s most important customers. The only other nation that’s a major player in making cell phones that’s also on good terms with Western governments is Japan, which has several cell phone makers. Of those, the only one with significant international reach is Sony, which hasn’t been going after the enterprise market.
Of course, there’s always Finland, formerly home to Nokia, but that’s now part of Microsoft, and the state of Microsoft’s mobile phone business is undetermined. But that doesn’t strictly rule Microsoft out. We’ll just put them on the “maybe” list.
So that brings us back to Apple. It’s worth noting that all the reasons that Todd gave as to why it would make sense for Samsung to buy BlackBerry also apply to Apple. But there are a couple of perhaps better reasons that apply to Apple, as well.
Seeking BlackBerry’s Next Suitor if It’s Not Samsung
First, Apple is a U.S. company, which avoids the problems of being based in China from a security perspective. In addition, the United States and Canada have a series of trade agreements that mean business between the two countries has few restrictions.
Likewise, there are few security restrictions between the United States and Canada. How few? Just walk around NORAD (North American Air Defense Command) headquarters in Colorado Springs and count the number of Canadian uniforms and you’ll get the idea.
From Apple’s viewpoint, there are other good reasons. Apple has been trying to break into the government market here and elsewhere with limited success. In addition, for many corporate users, the iPhone isn’t exactly what’s needed. On the other hand, Apple is doing very well with part of the enterprise solution, especially when it comes to the availability of apps for vertical industries and when it comes to tablets.
But when it comes to text-intensive uses where the BlackBerry devices shine, the iPhone can come up short. The same is true in other industries where Apple is trying to gain a foothold, including the automotive business where BlackBerry’s QNX devices are growing while Apple is struggling. Perhaps most interesting are the devices where it’s BlackBerry that’s enabling Apple’s in-car integration most effectively.
It’s also worth noting that there’s almost no device overlap between the two companies, which means less to cannibalize, but it’s also true that both QNX and iOS are based on similar versions of Unix, which could mean some engineering compatibility, at least at the staff level. There could be a lot of synergy.
So does all this mean that Apple is quietly trying to buy BlackBerry, but is keeping it quiet so the price doesn’t go crazy? Of course not.
Plus, I don’t have any special knowledge, but if any device company merger makes sense, it’s really Apple and BlackBerry that makes the most sense. Could that be why nobody is talking about it?