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Summary:

Research In Motion shares leapt on an analyst report suggesting Samsung was considering to license BlackBerry 10 for its phones. Anything is possible, even no-cost licensing to gain market share, but it doesn’t make sense. Nearly 1 of every 2 Android phones sold is a Samsung.

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Research In Motion shares shot up 10 percent at the opening bell Wednesday thanks to an analyst report suggesting that Samsung, the world’s top handset seller, may license the BlackBerry operating system, says Mobile Business Briefing. Shares retreated by half during the day and Thursday Reuters reports that Samsung has denied any interest in licensing BlackBerry 10 or in purchasing RIM, which has fallen from grace as more nimble competitors have passed it by. None of this should surprise, however.

Samsung could be playing coy, of course, but I can’t think of even one good reason for Samsung to even entertain the thought of licensing an operating system that isn’t yet on phones. The company is already the top seller of Google Android devices, for starters, which according to IDC earlier this week, accounted for 68.1 percent of worldwide smartphone sales in the last quarter. Of that market, Samsung sold 44 percent of the devices, meaning nearly 1 of every 2 Android phones sold last quarter was a Samsung.

Let’s take this a step further. In June, Google said that it activates one million Android devices per day. If Samsung accounts for 44 percent of that figure, the company is selling 440,000 smartphones each day on average. And the trend has been up: each quarter for the past 18 to 24 months, both Samsung sales and Android activations have grown. Add in the continuing success of the recent Galaxy S III handset and the trend should accelerate. In other words: Samsung is doing just fine without BlackBerry 10.

Keep in mind that Samsung already licenses another mobile operating system too: Microsoft Windows Phone. While sales of these phones haven’t been stellar, Windows Phone is starting to show some signs of life lately. And my late 2011 prediction of Windows Phone holding more market share than BlackBerry by the end of 2012 is starting to look more possible by the day; although it may be close. Samsung’s already paying Microsoft a license fee for Windows Phone; why spend more money to license yet another platform that’s losing momentum?

It’s possible that RIM gives Samsung — or another handset maker — some sweetheart licensing deal just to gain market share, but even at free, it doesn’t make sense for Samsung. The company would have to divert production resources and software engineers away from its popular Android phones towards BlackBerry devices.

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  1. You’re right Kevin, BB10 makes no sense for Samsung–or anyone else, including BlackBerry.

    However, the BlackBerry back-end device management features are second to none, and Samsung doesn’t have any of this capability. I could see how it might make sense for Samsung to acquire the MDM assets to begin to build up a bit of an ecosystem for the enterprise market. Of course it would all need to be ported to android because, as we’ve already agreed, BB10 makes no sense for anyone.

  2. You missed one critical armour in samsung arsenal. Hadar is Samsung homebrewed OS which the company still keeping (unless I missed a news of Samsung stopped supporting that). Outright buying of OS10 makes more sense. Samsung should always keep some powerhouse to just for hedging.

    1. Ballu, do you mean Bada? I’m not familiar with Hadar.

  3. My mistake, its BADA.
    Its kindle fire autocorrect, made this mess. Sorry for not proof reading.
    Back to point, Good to have BADA perspective in this story.

  4. No way Windows Phone has bigger market share than RIM by the end of the year. Won’t happen. Otherwise, I think your analysis is solid.

    But, I’m still not prepared to write off a Samsung acquisition just yet.

    Even with the run-up, $RIMM is still only valued at a meager $4 billion. That’s less than the profits Samsung generated just last quarter. Could they incorporate Blackberry messaging, email and security features into their Galaxy line-up? How long would that take? That could serve as a major differentiator from all other Android devices.

    If Samsung made that work, I’d be hard pressed to think of any reason to buy a non-Samsung Android device (unless it was just absolutely a sub-sub $100 throwaway).

  5. Patent portfolio must be worth something even if the OS itself is not all that useful. I don’t know whether enterprise features can be ported to Android and stay secure enough for IT people, but if it can be, that is another asset. The snag could be RIM board asking for a premium over its existing market cap, so waiting another quarter or two to get RIM even more desperate might get Samsung a lower price.

  6. “My late 2011 prediction of Windows Phone holding more market share than BlackBerry by the end of 2012 is starting to look more possible by the day.”

    I’m sorry, Kevin, that’s like saying the turtle is starting to look faster than the snail.

  7. Yup! I agree with this post! Thanks for sharing!

  8. Reblogged this on 365newsng.

  9. Assuming sales based on activations is dishonest. Google activates tons of cheap prepaid android phones that people buy to replace their lost or stolen smartphones.

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