BlackBerry Ltd (BBRY) passing on China for now

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BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) Chief Executive Officer, John Chen, believes he will get a better return for investors by focusing on markets where BlackBerry is already popular including India, South Asia and Southeast Asia rather then making a play for China.

While China is the world’s largest smartphone market, Chen believes that building up BlackBerry to a size that would allow the scale to serve it’s consumers in China would take too long to accomplish. The software and enterprise-focused company has no plans on making a move into China.  Before making a public announcement not to expand in China, BlackBerry’s CEO, John Chen, wisely considered the overall problems of negotiating contracts with the Chinese government that might occur. Such contractual negotiations could cause delays in actual product presentation and also involve a “geopolitical” equation that would satisfy both China and the US.

BlackBerry Resists Requests for User Data

As part of agreements between Smartphone sellers in China, user data is requested by the Chinese government. While CEO Chen realizes the potential for sales of BlackBerry in the huge Chinese market, it also recognizes the potential for security breaches of BlackBerry users’ data. Hence, the decision by BlackBerry not to further expand their device market in China. While BlackBerry understands that many of their competitors are willing to be flexible with Chinese authorities, BlackBerry feels that in order to maintain highest levels of security, capitulating to Chinese authorities requests for user data jeopardizes their own global device markets and their reputation.

Considering that security is one of BlackBerry’s most important features, you can see why Chen would be protective of the company’s status there.

Certain opportunities in China in the future

Despite all this talk, BlackBerry’s CEO isn’t completely closing the door on China and Chen says that there might be certain opportunities for BlackBerry in the future.

James Vrionis

James Vrionis knows Technology and is Based in the Palm Desert Area. Contact him at jvrionis@investcorrectly.com

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