BlackBerry: The debacle of a giant - Brownsville Herald

class=”dateline”> TORONTO – It was a device so addictive that some time was compared with crack cocaine. President Barack Obama confessed to being one of the millions of devotees who could not have him away. And Madonna once said that he slept with it under his pillow.

And then came the iPhone.

users now addicted to Facebook, share photos and video game Angry Birds began to flirt with the opposition. And as multipurpose phones flooded the market with their large screens and thousands of applications, the BlackBerry could not keep up with the times.

The plan was for the launch of BlackBerry 10 this year, its new operating system and new devices with more and better features touch screen-Z10 and Q10 for physical keyboard loyalists should rejuvenate the brand and attract customers. But the long-delayed phones have failed to revive the company.

In its heyday, in the fall of 2009, BlackBerry smartphones have a market share of 20%, said Mike Walkley, analyst at Canaccord Genuity. But today is just 1.5%.

Now the company reports it will lay off 4,500 employees, equivalent to 40% of its global workforce, at a time which seeks to reduce costs by 50% and focus on enterprise customers who are more loyal to the brand. A week earlier than expected, BlackBerry shocked the market by reporting on Friday that he lost nearly 1,000 million in the second quarter. He also said it is taking a charge of $ 900 million to discount the value of its large inventory of unsold phones.

trading of its shares was halted before he announced the news, and plummeted to $ 8.01 when trading again, before closing down 17% at $ 8.72.

“This is the end of BlackBerry as we know it,” said Colin Gillis, analyst at BGC, from New York. “This is a key turning point.’re Eliminating nearly half of its workforce and will have to concentrate on becoming a niche player focused on the business.”

Gillis said he expects to see more BlackBerry ads on television, adding that the company might be interested in the purchase, now that they have announced restructuring. Gillis thinks the BlackBerry survive as a participant much lower. And at the end of the second quarter, the company had cash and investments totaling 2,600 million and no debt.

The expert added that can not understand why BlackBerry revealed its results late on Friday, a week earlier than planned. “Did you have to do on a Friday at 3:15 pm? Could not they have waited a week, do on Monday?”

company Waterloo, Ontario, surprised the market late on Friday and announce it expects to declare a staggering loss of between 950 and 995 million in the second quarter, including a massive charge between 930 and 960 million dollars for the amortization of the value of their inventory. Your income, only 1,600 million, are about half of the 3,000 million analysts expected, according to FactSet.

“We are taking the difficult but necessary operational changes to put us in the proper position in a sector that is more mature and competitive, to drive the company to profitability,” said Thorsten Heins, president and CEO of BlackBerry, in a statement.

For his part, Minister of Industry of Canada, James Moore, said in a statement: “We have very present to those who have lost their jobs in Blackberry, this is always a concern for our government.”