Blackberry has had a rough couple of years. So bad, in fact, that the troubled company had to cancel two upcoming phones that were originally scheduled for release next year.
The two Blackberry phones, which were still under development, were cancelled amidst feats of identified inventory risks. The phones were known to company insiders under the code names Kopi and Café. These units were also designed as low-cost devices to compete with other manufacturers in emerging markets.
The announcement of the cancellation came while the company was finalizing a deal with the Taiwanese contract manufacturer Foxconn Technology Group. However, some analysts view the cancellation as well as the Foxconn deal good tidings for Blackberry. The recent changes could give Blackberry a fresh start as it prepares to move its focus to high-end enterprise devices. Foxconn has worked with some of the most iconic smartphones such as the iPhone and the partnership could give Blackberry the necessary push it needs for a complete revival.
Blackberry CEO John Chen announced last week that Foxconn will be handling the design process for Blackberry handsets while focusing on its enterprise solutions. However, Chen also shared that the company is still considering getting back into the consumer handset market some time in the future.
Since the two cancelled phones will be running on the same technology and software that has pushed the company to the brink of collapse, ditching them in favor of other projects with more potential will help the company conserve its already dwindling resources for another day. However, the company still has a long journey ahead as it tries to push its bottom line back into the black. While a few good ideas can help the company reach their goals, the same can be said about potential mistakes.
The company is fighting a losing battle with continuously declining smartphone sales. The company reported that it was only able to sell around 1.9 million smartphones in the third quarter of 2013. Back in the second quarter, the company only sold 3.7 million units.
In addition to the cancellation of the two phones, Blackberry has also announced that the company will be cancelling its annual Blackberry Live conference. Blackberry's problems continue to pile up and the company reported Q3 losses of over $4 billion.
"Believe it or not, both of these announcements are actually the first very good news I have heard from Blackberry in quite a long time," said technology analyst Jeff Kagan.
"The news they are partnering with Foxconn is very good. Foxconn makes some of the heavy hitters and most successful devices in the wireless industry today like the Apple iPhone. Working with them will let Blackberry tap into the kind of thinking they so sorely need to start a recovery.
"Cancelling the rollout of two unreleased smartphones based on the same design as recent failures is more good news. It seems like somebody hit Blackberry in the head and they are starting to see more clearly now. So far this is all very good news, but it's just the first step in a long journey toward an eventual recovery," Kagan said.
Shares of BlackBerry were trading up 3.75 percent at $7.75 on the NASDAQ on Tuesday afternoon.
