5 ms·

At 5 billion dollars of market cap, the company's worth less than what Microsoft paid for Skype. Frankly, Apple or Google should make this purchase just for the

by cjoh 13y ago

At 5 billion dollars of market cap, the company's worth less than what Microsoft paid for Skype. Frankly, Apple or Google should make this purchase just for their federal salesforce alone -- Blackberry knows how to do something those other companies don't do well and that's sell and entrench inside of Governments. That alone is worth billions. Give the iPhone to a Blackberry federal salesperson, and you've got billions.

at-fates-hands 13y ago
This was true maybe ten years ago, but even the US government is now moving away from Blackberry: http://www.techweekeurope.co.uk/news/rim-suffers-fresh-blow-as-us-government-moves-away-from-blackberry-60725 http://www.techweekeurope.co.uk/news/rim-suffers-fresh-blow-... "Research In Motion (RIM) has suffered yet another setback as the General Services Administration (GSA), the US government’s main procurement agency, announced its decision to provide iPhones and Android devices to its employees. Though BlackBerrys will still be available from the agency, the announcement represents a general shift away from reliance on RIM products and a move towards a bring-your-own-device (BYOD) strategy."
- cjoh 13y ago
  Right. That's basically because employees (I used to work for the gov) want them, much to the CIO's dismay because the CIO is being better served by Blackberry sales folks than Apple's or Google's. By better served, I don't mean "taken out for golf," I mean "contracting vehicles have been set up by BlackBerry's experienced salesforce that makes this IT easy for a CIO to purchase." The SBA and many other agencies just renewed their blackberry contracts because, frankly, it was just easier for them to buy it. If you put an iPhone or an Android device into that existing framework for purchasing, it's game, set, match.
bane 13y ago
> Apple or Google should make this purchase just for their federal salesforce alone... That wouldn't be a good reason for Apple to buy BB, it'd be a money losing proposition for them. The Feds have already moved on to Android phones and reversing that would take years.
jcampbell1 13y ago
From an acquisition perspective, the "price" is Market Cap + Debt - Cash. The total cost comes to just over $2B. At that price, I see it as a no brainer for Microsoft. They just need to ship a windows phone that is compatible with all the BB enterprise stuff, and IT departments will force it on the employees.
- keltex 13y ago
  That's not true. The market cap which is the value of all outstanding shares. Debt and cash are factored into the market cap.
  - cmart 13y ago
    His point is that the company has a net cash position of $3bn, meaning someone who pays $5bn for the entire market cap of the company would immediately receive $3bn back in cash, making the real price effectively $2bn
    - lifeisstillgood 13y ago
      But he is saying the $5bn already includes a discount for the cash you will get back. The market knows it has 3bn in cash lying around, so the market reckons that all of Blackberry's future profits and its on hand cash, are worth $8bn today, but that includes the $3bn of cash, so it adjusts the shares down to be $5bn - effectively saying the market thinks Blackberry can generate another $5bn worth of dividend-able profit for the rest of its life. For a company with an EBITDA of 1.3bn thats about 3 years.
      - foobarqux 13y ago
        What is the market cap of a lemonade stand with 3bn cash?
        lifeisstillgood 13y ago
        Err, ok I am missing something from my basic economics - I was pretty certain the market cap of a company was its projected lifetime profits. So if a lemonade stand has 3bn in cash it's done pretty well selling lemonade surely?
s_q_b 13y ago
Federal sales and ECC encryption patents are alone worth the purchase.
mtgx 13y ago
I think Blackberry has some juicy "smartphone" patents, too, that aren't so end-of-life as Motorola's patents. Plus, BB10 is pretty great as an OS, and has the best and most efficient multi-tasking system from what I've noticed (stuff can run in the background without a big hit on battery life, and the transition between apps is very smooth).

by cjoh 13y ago

at-fates-hands 13y ago

This was true maybe ten years ago, but even the US government is now moving away from Blackberry: http://www.techweekeurope.co.uk/news/rim-suffers-fresh-blow-as-us-government-moves-away-from-blackberry-60725 http://www.techweekeurope.co.uk/news/rim-suffers-fresh-blow-... "Research In Motion (RIM) has suffered yet another setback as the General Services Administration (GSA), the US government’s main procurement agency, announced its decision to provide iPhones and Android devices to its employees. Though BlackBerrys will still be available from the agency, the announcement represents a general shift away from reliance on RIM products and a move towards a bring-your-own-device (BYOD) strategy."

cjoh 13y ago
Right. That's basically because employees (I used to work for the gov) want them, much to the CIO's dismay because the CIO is being better served by Blackberry sales folks than Apple's or Google's. By better served, I don't mean "taken out for golf," I mean "contracting vehicles have been set up by BlackBerry's experienced salesforce that makes this IT easy for a CIO to purchase." The SBA and many other agencies just renewed their blackberry contracts because, frankly, it was just easier for them to buy it. If you put an iPhone or an Android device into that existing framework for purchasing, it's game, set, match.

bane 13y ago

> Apple or Google should make this purchase just for their federal salesforce alone... That wouldn't be a good reason for Apple to buy BB, it'd be a money losing proposition for them. The Feds have already moved on to Android phones and reversing that would take years.

jcampbell1 13y ago

From an acquisition perspective, the "price" is Market Cap + Debt - Cash. The total cost comes to just over $2B. At that price, I see it as a no brainer for Microsoft. They just need to ship a windows phone that is compatible with all the BB enterprise stuff, and IT departments will force it on the employees.

keltex 13y ago
That's not true. The market cap which is the value of all outstanding shares. Debt and cash are factored into the market cap.
- cmart 13y ago
  His point is that the company has a net cash position of $3bn, meaning someone who pays $5bn for the entire market cap of the company would immediately receive $3bn back in cash, making the real price effectively $2bn
  - lifeisstillgood 13y ago
    But he is saying the $5bn already includes a discount for the cash you will get back. The market knows it has 3bn in cash lying around, so the market reckons that all of Blackberry's future profits and its on hand cash, are worth $8bn today, but that includes the $3bn of cash, so it adjusts the shares down to be $5bn - effectively saying the market thinks Blackberry can generate another $5bn worth of dividend-able profit for the rest of its life. For a company with an EBITDA of 1.3bn thats about 3 years.
    - foobarqux 13y ago
      What is the market cap of a lemonade stand with 3bn cash?
      - lifeisstillgood 13y ago
        Err, ok I am missing something from my basic economics - I was pretty certain the market cap of a company was its projected lifetime profits. So if a lemonade stand has 3bn in cash it's done pretty well selling lemonade surely?

s_q_b 13y ago

Federal sales and ECC encryption patents are alone worth the purchase.

mtgx 13y ago

I think Blackberry has some juicy "smartphone" patents, too, that aren't so end-of-life as Motorola's patents. Plus, BB10 is pretty great as an OS, and has the best and most efficient multi-tasking system from what I've noticed (stuff can run in the background without a big hit on battery life, and the transition between apps is very smooth).