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Is BlackBerry ripe for expansion in China?

Posted: 12 Nov 2014 ?? ?Print Version ?Bookmark and Share

Keywords:China? John Chen? BlackBerry? Xiaomi?

The sheer size of China's mobile market inspired BlackBerry to hitch its wagon to a star. The handset maker now eyes an expansion in the world's largest smartphone market through partnerships with Xiaomi and Lenovo Group, reported the Jakarta Globe.

BlackBerry CEO John Chen said he met with Xiaomi's CEO Lei Jun and Lenovo's head Yang Yuanqing during the Asia-Pacific Economic Cooperation CEO Summit in Beijing. Aside from the two, Chen also made contact with Cher Wang, chairwoman of Taoyuan, Taiwan-based HTC.

These meetings embody BlackBerry's efforts to make its way back to profitability after things had gone from bad to worse when the declining shipments plunged the company into the red, posting net losses in each of the past three years.

BlackBerry CEO John Chen

Chen: China is not a market where deals are done quickly. It's going to take a while, but I'm interested.

The company saw an opportunity for agreements on technology licensing, distribution or manufacturing as demand for security, encryption and privacyfeatures that BlackBerry claims to be its strong suitare currently on the rise in China, said Chen in an interview.

[See also: Smartphone mania in ASEAN drives strong sales]

To make it big in China, it makes sense to build partnerships with local companies, indicated Chen. BlackBerry has not concentrated on this market, which it sees as huge but highly competitive. Chen said that now is the right time to look at growth prospects in the country.

Chen took over about a year ago to create a major shakeup and make up for the huge losses BlackBerry suffered due to decline in shipments, with its market share divided between Apple and Samsung.

Chen's approach targeted business customers by bringing back phones with signature physical keyboards and offering more software-based services. In addition, he outsourced some production and sold property.

The work has put the Canada-based handset maker on track for break-even cash flow by the end of this fiscal year. Chen reiterated that BlackBerry will start to make profit in 2015.

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