Month: September 2013

In response to my friend Justin Yee’s post on the intellectual property of Blackberry, I completely agree with his statement that Blackberry’s technology’s popularity coincided with when the smartphone maker itself was popular. However, despite its current situation, there is definite value in Blackberry’s intellectual property portfolio. Blackberry’s popularity was largely due to its endorsement from governments and large corporations. Their encryption technology, such as encrypted e-mail and messaging service, prevents sensitive data from being obtained.

Whether or not the company decides to sell its patents to enhance their recovery process is still up for debate. Despite its unsuccessful attempt in the consumer smartphone industry with the Z10, Blackberry still hold extremely valuable technology which can save the giant in the government and corporate smartphone market. If Blackberry does choose proceed with its corporate business, it may prove to be successful once again. We can not also disregard the $2.7-billion of cash Blackberry still possesses on its balance sheet when talking about take over. If Blackberry were to be taken private, the company still become profitable through its current customer segments.

On Friday September 20, 2013, Blackberry announces that it will write off $1-billion worth of phones and part and also cut 40 percent of their current workforce in an attempt to save the company from free fall. This write off is largely due to an inventory surplus of Blackberry’s new Z10 smartphone. The lack of sales in the smartphone division will result in a quarterly revenue of under $800-million, significantly less than the $1.7-billion it reported a year ago. This news shocked investors’ confidence resulting its share prices tumbling 16 percent.

Blackberry’s decision to compete with smartphone giants, Apple and Samsung, inevitably backfired. The poorly marketed Z10 smartphone was unable attract consumer attention with an unimpressive value proposition, hindering its ability to differentiate itself. Instead of attempting to compete with Apple or Samsung, Blackberry should shift their focus on their two larger customer segments: governments and corporations. Since its founding, Blackberry was able to capture this customer base with its encrypted e-mail and web-browsing technology. If Blackberry continues to focus its resources on the consumer smartphone industry, the question won’t be will Blackberry succeed. It will be when the giant from Waterloo fall.

Source:

http://www.theglobeandmail.com/report-on-business/trading-in-blackberry-halted/article14440386/

Roaming is an important factor to many consumers’ choice of carrier. Being one of the 3 major telecommunication providers in Canada and holding virtually monopolistic power, Bell is giving in to its subscribers’ demand for lower roaming rates. Its new roaming plans will have their prices be cut by as much as 50 percent. This decision was largely due to the feedback provided by its customers. In a press release, Bell stated, “We’re starting with the most popular destination, and Bell is committed to working with our global telecom partners to further reduce international roaming costs for our customers.”

Although Bell’s decision may seem as a response to feedback, I believe that it’s attempt to keep its monopolistic power by preventing companies such as Verizon and AT&T from entering the Canadian market. If Bell does not reduce its roaming prices, it may create an opportunity for Verizon to capture and further add to its value proposition. Diversified customer base is a huge part of any business and large corporations cannot afford to alienate a particular segment. By understanding its consumers’ need, Bell is able to retain is current customer base and can exploit new marketing strategies revolved around their decision.

Source:

http://www.theglobeandmail.com/report-on-business/bell-to-cut-roaming-fees-by-half/article14333517/

It has recently been revealed that the workers of the production company, Jabil Circuit, which manufactures the new iPhone 5C, has had their rights ‘flouted’ by the company. The news came in after allegations made by China Labor Watch, a non-profit organization, that workers were required to work 12-hour shifts, six days a week, with only two 30-minute breaks. There has also been claims that female employees were asked to take pregnancy tests; this violates both Chinese laws and the code of practise which Apple has imposed on it suppliers last year.

Although Apple is the only technology company to be a part of the Fair Labor Association, it raises the question, why is this happening again? It was only a year ago when Foxconn’s employees, another manufacturer of Apple products, committed suicide to protest harsh and illegal working conditions and practices.² These practices raise some very questionable business ethics.

In the end, products such as the iPhone 5S, iPhone 5C, iPads and alike continue to be sold in large quantities regardless of what is going on in the manufacturing plants. However, we must ask ourselves the real question, why do we still support these companies?

Source:

http://news.cnet.com/8301-13579_3-57515968-37/riots-suicides-and-other-issues-in-foxconns-iphone-factories/

http://www.theguardian.com/technology/2013/sep/05/workers-rights-flouted-apple-iphone-plant