Blackberry Surrenders In Defeat, Quitting The Smartphone Manufacturing Business

Blackberry is throwing in the towel as a smartphone manufacturer, accepting that in a world dominated by iPhones and Galaxy Notes, it can no longer compete in the industry. Although this announcement pertains only to the hardware production side, it still marks the struggle that the company has faced over the last few years. Blackberry will still be handling the software aspect of its phones, so the iconic brand is still technically hanging on.

The announcement was made by Blackberry CEO, John Chen during the latest fiscal report, Forbes reports. According to the report, the hardware manufacturing and selling section of the company were given targets that would have allowed it to continue functioning if it made profit. Unfortunately, sales missed the mark every single time, which gave the company no choice but to simply hand it over to third-party manufacturers.

“Under this strategy, we are focusing on software development, including security and applications,” Chen states in the report. “The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital.”

Chen has actually been pushing for the company to drop the hardware production aspect from the moment he became CEO, which had been a burden on Blackberry. By focusing solely on software, the Canadian brand can cut back on costs and might just make decent return of investment.

The decline of the phone maker has been significant over the last year. On top of failing to make any gains in the larger consumer market, many of its high-profile fans have also abandoned the brand, Engadget notes. Among these important users include President Obama and the U.S. Senate.

On the plus side, the report also mentions that Blackberry has been doing well by focusing on its software products. Chen even said that the company has doubled its revenue with software year over year. Perhaps this will give fans of the brand some hope that it won’t completely go the way of Nokia after all.