Blackberry’s John Chen Spoke about the Performance of Priv

The smartphone maker announced its fourth quarter financial results yesterday according to which The Priv did not get the attention we thought it did.

We had initially hoped that Blackberry Ltd.’s android powered smartphone, Priv would prove to be a turning point for the Canada based smartphone maker. However, according to the recent fourth quarter fiscal year financial results, it can be observed that the product did not get as much as attention as we had hoped it would.

The CEO John Chen had previously stated in an interview with CNBC, that in case the company fails to progress in the hardware business; it might exit the smartphone market and be a software-only firm. In addition to that he also said (at the launch of Priv last year) that the company needed at least a year to make the specific smartphone profitable. Despite the dip in its stock and revenue, he is expecting that the product could reap profits in the near future.

As per the fourth quarter earnings report, the Canada-based company incurred a loss due to which a dip of 5% was seen in BBRY stock. From initial revenue of $660 million from a year earlier, the revenue fell down to $464 million. Furthermore, the analysts had predicted that the organization might post earnings of $563.2 million; instead it made a loss of $238 million in comparison to a year ago, the loss was at $28 million.

In an interview with Bloomberg, the CEO justified why the android based smartphone failed to get the attention everyone thought it would. He explained that due to a delay in the network contract agreements the Priv’s distribution network suffered and took a hit. Furthermore, it has been made quite evident that the high-end smartphone market has officially hit a saturation point since the Priv was targeted as one of the high-end smartphones it took a hit in that department as well. He added that the price of the device might have to be taken into consideration again and a change might be seen some time next week.

John further told Bloomberg that the company is also working on mid-range category smartphone now as well which means that in the near future we will be seeing some new Blackberry mid-range phones. However at a lower average selling price (ASP) the company will need to smell a number of units in the market to breakeven as this product is mainly for the mass market. In addition to that, he did emphasize of the fact that whoever bought The Priv, loved it. He believes that mid-range phones might prove to be an excuse to sell BBRY’s high-end phones as well.

He also talked about some of the drawbacks in the device which include upgrading the operating system on a regular basis. Rumors have surfaced that android’s latest Marshmallow 6.0 will soon hit the Priv as well. He is quite certain that the smartphone will prove to be an excellent device in the smartphone market; and with its expansion plans to enter Japan and Mexico will only increase the company’s market share in the industry. Even though he mentioned that in case the hardware business does not perform well, they will exit it however it seems as though he has no such intentions of doing so.

Furthermore, there have been rumors of two new android smartphones to hit the market soon that have been codenamed ‘Rome’ and ‘Hamburg’. However, it should be mentioned that the company’s fate completely depends on the product’s pricing, average selling price and marketing along with other factors.

Apple Shifts Focus To Indian Market Now

The technology company is planning to take over the Indian market as it decided to open retail shops in the country and become the official distributor of iPhones.

Apple, Inc. has been smart enough to make decisions of entering the second most populous country in the world, India – as China faces slowdown due to economic conditions, the technology giant cannot afford to lose demand for iPhones. It has started to focus more towards one of the biggest countries of the world.

Although the technology giant has been discrete about the matter, it has been taking its piece of pie from India by investing in advertisements, improving its distribution system, making schemes on interest free phone loans and cutting prices. Presently, it sells its products in the Indian market through various distributors but now it wants to be the official seller in the market. To do so, it has filed a request on Wednesday with the Indian Government to run its own retail shops and start selling the devices online.

By the end of the previous fiscal year on March 31, the Cupertino, Calif. company had revenue generation of over $1 billion alone from the Indian market. Despite being so popular there, currently it only had a 2% chunk of the smartphone market. According to an analyst at Canalys in Singapore, Rushabh Doshi, India is a huge potential market for Apple to enter.

Previously, 118 million iPhones were sold in India and according to analysts’ estimations, this number is expected to rise to 174 million units by the year 2017. Initially, an Apple product would only be seen in the wealthy user’s hands in India but now, the company has decided to reposition itself in a way that it seems accessible to the middle class as well.

China has not started to show signs of saturation due to which Apple had to make this move and it could prove to be a smart one, as over 10 years, it could be one of the most important markets in terms of revenue generation. At this point, the company had declined to comment on its expansion plans but the chief executive officer, Tim Cook had initially stated that there has been progress in the country.

According to research by IDC, in a year’s time, India is likely to be above the United States smartphone’s market and second to China – since the market is growing and expanding rapidly. Around 35% phones being sold in the market are now smartphones, which leaves Apple with a huge chunk to conquer. The use of smartphones in the market is comparatively low because the people of the country tend to purchase and use cheaper phones.