Could BlackBerry still become the next Apple? With 0% market share in the U.S., probably not, but there's no harm in trying, especially now that the embattled mobile company has forged a partnership with Apple's favorite supplier of smartphone components and maintains a stronghold in the East.
Last week, BlackBerry launched the BlackBerry Z3 in Indonesia, where the locals reportedly go crazy at BlackBerry product launches, even requiring the police to keep things in order. The entry-level all-touch phone retails at IDR 2,199,000, which is roughly equivalent to $190. This is the first smartphone produced from BlackBerry's partnership with Foxconn.
"BlackBerry is beloved in Indonesia and its loyal fans have made it a popular smartphone brand," says Foxconn founder Terry Gou. "This is why we are so proud to be able to help bring BlackBerry even closer to Indonesia with a fantastic product that will be accessible to even more Indonesians. This is only the beginning of what we know will be a long and fruitful partnership between Foxconn and BlackBerry."
BlackBerry said the Z3 was a "substantial success" since its launch in Jakarta but did not release any figures. But despite what it sees as a triumph, the company's Indonesian market share plunged from 25% last year to merely 4% this year. Analysts believe BlackBerry's popularity suffered a major hit when BBM, the company's mobile social network hugely popular in Indonesia, became available for Android, which currently dominates the industry with almost 81% market share. This is followed by iOS devices with 13% of the market share. BlackBerry shares the remaining 6% with Microsoft's Windows phones and other manufacturers.
Still, the partnership with Foxconn could prove to be profitable for both companies. John Chen, BlackBerry's new chief executive who is trying to turn the company's fortunes around by getting rid of unprofitable businesses and setting its sights on software, said Foxconn took only four months to develop the Z3's hardware, a process that Chen believes is "probably the fastest in the industry." BlackBerry isn't exactly known for quick product development. Its flagship smartphone, the BlackBerry 10, faced several delays before launch.
Last year, BlackBerry reported a $5.9 billion loss after it sold only 1.3 million smartphones compared to the 6 million units it sold in 2012. With Foxconn working on hardware, BlackBerry eliminates the risk of writing off unsold phones and unused components.
"Sixty to 75% of all phones is common parts. Things that we order and that they don't use, they can be used somewhere else. They could be in an HP printer or a Canon whatever or a Dell computer or an iPhone and vice versa," explains Chen in an interview.
BlackBerry is partnering with Foxconn International Holdings, a Foxconn subsidiary that has seen quite a few struggles ever since its biggest client, Nokia, was sold over to Microsoft. It has since then took to manufacturing hardware for small Chinese phone companies, but a new client like BlackBerry would be a "nice add-on."
