Canadian telecommunications company BlackBerry Limited is reportedly considering the creation of a spin-off subsidiary out of its messaging service, BlackBerry Messenger (BBM). The new subsidiary, called BBM Inc., would operate independently from its parent company.
BlackBerry has been losing money due to a dwindling customer base and sluggish sales as consumers move on to other types of smartphone. The company fell behind after it did not evolve with the rest of the technology industry, failing to produce a popular tablet device or quickly break into the touchscreen-dominated market for smartphones. The company, which once had more than 50 percent market share in the United States, has dwindled to around only three percent.
BBM, which has about 60 million active users per month, has remained popular despite the public’s general loss of interest in BlackBerry devices. Earlier in August, the company’s board of directors formed a special committee to investigate ways to enhance BlackBerry’s finances. Such options could include partnerships, joint ventures, or a possible sale of the company. Due to BBM’s popularity, its own spin-off subsidiary could create and enforce the messaging service’s status as a valuable asset, adding net worth to BlackBerry’s sale price. BlackBerry has denied that it intends to spin off BBM, ridiculing such reports as “complete rumors.”
Although the spin-off has not been confirmed as yet, BlackBerry has already moved many of its executives over to BBM’s team, indicating that it does intend to place more emphasis on the service in the future.
In an attempt to compete with other brands such as WeTalk, WhatsApp, and Twitter, BBM is set to announce a variety of new features. Enhanced compatibility will allow the messaging service to appear on iPhones and Android smartphones, and a desktop version may also become available. Video chatting will also be implemented as a feature. In addition to upgrading the messaging service itself, BBM is also planning to release a service called BBM Channels, which is currently in beta testing. This new service is a tool that is very similar to Twitter as well as some aspects of Facebook. Users and brands are able to broadcast updates to a group of individuals following their feeds. These followers can leave “likes” for users whose broadcasts they wish to track.
Although spinning BBM into a separate company could be a wise marketing decision on BlackBerry’s part, it may turn out to be a pointless endeavor. The messaging service’s 60 million users pale in comparison to other major competitors like WeChat, with 250 million users, or Kik with 80 million. The fact that BBM is not yet available on other platforms, as well as the popularity and compatibility of its competitors, may mean that the service will not generate the amount of users it needs to become a self-sustaining asset to its parent company. BB
Only time will tell whether BlackBerry actually will convert BBM into its own separate company, and whether such a spin-off will help the struggling telecommunications company to regain some of its lost value.