$BB: Going Full Sales Mode Now

Update

Note: this is an update to my latest deep dive on $BB.

Summary

I watched $BB´s 2021 Security Summit last night and in summary, the company seems to have taken on a very salesly vibe, which was previously nowhere to be seen. When I first dived deep into $BB in January, it was hard to read through its annual letters and make sense of their offerings. It was quite hard work to put together a cohesive view of their products and services. In the summit´s keynote, it´s suddenly easy to understand just how $BB´s offerings actually fit into the world and provide value. The picture $BB presents in the summit makes a level of sense that previously was not immediately available to outside spectators. For these reasons, I believe Blackberry to be in full sales mode now, after years of getting the company ready to really take on the market. In the remainder of this post, I will try and explain the fine qualitative details that have led me to this conclusion. It is all highly intuitive on my side, so bear with me if the logic is not evident.

Separating Offerings into IoT and Cybersecurity Divisions

The keynote starts with John Chen explaining that it´s all about Unified Endpoint Management. Chen is fully betting on a future in which we connect a growing number of things to the internet and we simply need to secure them. As many of you know, this is definitely what I am long $BB for. He explains that while UEM is the future, grouping $BB´s products into two divisions (IoT and Cybersecurity) is meant to accelerate go to market. This makes sense because whilst there are some of us that understand the future that $BB is heading towards in the abstract, potential customers just want to know what $BB can do for them today. He explains that although IoT and Cybersecurity converge down the line, the current distinction helps people understand the offerings better. I believe that before separating $BB´s offerings into these two divisions, it was hard to understand what they offered at all. This is likely to have a big impact in sales.

Cylance

It´s also become immediately obvious that since there are a vast number of cybersecurity attacks every day, $BB is betting on the fact that only machines will be able to truly secure endpoints and assets. Whilst Cylance sounded a bit cryptic before, in the summit it becomes easy for anyone to understand that Cylance uses AI to catch threats before they occur and that this enables machines to keep up, where humans would be totally overloaded with work. All the cybersecurity offerings have simply become easier to understand.

On an even more qualitative note, I feel like people inside the company know that their cybsersecurity is not far behind the industry´s best. I guess we will see if this is true in the next year or two, but I am getting a very strong sense of this.

New Hires are Sales People

John Gianmatteo, president of the Cybersecurity division, is the former President and CRO of McAffee. Having felt the lack of sales action in $BB since I went long, listening to this man speak is delightful. He seems like a word class salesman. I recommend you tune in to his pitch. The rest of the new hires have the same salesly flair and together, they all make me feel like inside the organization they all know they´re out to sell now.

QNX + Connected Cars = Inevitable

Whilst previously one had to dig deep to learn about QNX and the millions of cars on the road that it´s installed on, now it seems inevitable that QNX is going to be the core of automobiles. It´s not like anything about QNX has changed, but it´s the tone they use to talk about it and how they put it into context with what is happening in the industry. They seem to know that they are set up to do something big in the auto industry.

An additional observation is that $BB QNX supports Linux and Android. There is a discussion going in on Twitter over whether Ford went with Android and why this may be bad for QNX, but my understanding is that QNX is still largely undisputed at the lowest level of the software architecture. QNX enables OEMs to securely run / add pieces of software where they see fit.

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Disclosure

These are opinions only of the individual author. The contents of this piece do not contain investment advice and the information provided is for educational purposes only and no discussions constitute an offer to sell or the solicitation of an offer to buy any securities of any company. All content is purely subjective and you should do your own due diligence.

Antonio Linares makes no representation, warranty or undertaking, express or implied, as to the accuracy, reliability, completeness or reasonableness of the information contained in the piece. Any assumptions, opinions and estimates expressed in the piece constitute judgments of the author as of the date thereof and are subject to change without notice. Any projections contained in the Information are based on a number of assumptions as to market conditions and there can be no guarantee that any projected outcomes will be achieved. Antonio Linares does not accept any liability for any direct, consequential or other loss arising from reliance on the contents of this presentation. Antonio Linares is not acting as your financial, legal, accounting, tax or other adviser or in any fiduciary capacity.