BlackBerry managed to miss its sales consensus by 25% even with rock bottom expectations. Drama? Well, no. The share price was drifting up by 2% at the market open. Investors have effectively acknowledged the handset unit is dead and are now focussing on things like patents and the BBM mobile messaging software. And on this front, something truly fascinating is happening.
BBM has managed to maintain its traction in some key markets and crucially important new software features are arriving for iOS and Android devices. The next couple of months will determine if BBM can turn into a major business.
The big news for BBM is that it has managed to maintain commanding position in the iOS markets of Africa and the Middle East with some solid footholds in Latin America and South East Asia. Being the No. 1 iOS app in Nigeria and No. 2 in South Africa matters a lot because these two countries make up more than 80% of sub-Saharan Africa’s smartphone base. BBM is also the No. 3 app in Saudi Arabia and No. 5 in the United Arab Emirates, the touchstone markets of Middle East. It remains a top 10 app in Argentina, Columbia, Venezuela, which is a nice showing in South America. It’s also holding onto the No. 2 spot in Indonesia and the No. 17 in the U.K.
So for a messaging app, BBM is maintaining an unusually broad range of strong markets, many of them among the biggest smartphone volume growth engines in the world. BlackBerry may well hit 120 million to 140 million registered BBM users by summer. But can it monetize them? Can it turn the registered users into consumers hooked on the service in various ways that expose them to marketing and distribution pitches, a feat that LINE and WeChat have managed so well?
This is where we get to the new range of features BBM is about to unleash on iOS and Android users in coming weeks. Among most notable are BBM Voice, BBM Channels and BBM voice notes. Turning the BBM into VoIP service and testing how well the Channels feature is going to engage users in content-sharing are the key tests for the service. If these features work well, they should be able to give BBM another download boost and set it on its way to hitting 200 million users sometime next winter. The Channels would clearly be the foundation of any content distribution and marketing revenue BBM hopes to start building.
If BBM Voice and Channels flop, BBM will be doomed to remain a minor messaging system competing with Nimbuzz and Tango for a sliver of global attention. The era of judging BlackBerry on its hardware performance is over. In 2014, all eyes will be on BBM feature expansion narrative.