Boston, MA 12/24/2013 (wallstreetpr) – It is emerging that BlackBerry Ltd (NASDAQ:BBRY) canceled the launch of its two smartphones in order to seal the hardware business outsourcing deal with Taiwan’s Foxconn Technology. Insiders say that the cancelled phones were code-named Kopi and Café internally and they were aimed at the emerging markets. However, it was not clear when they were expected to hit the stores.
In recent times BlackBerry Ltd (NASDAQ:BBRY) has failed to charm the market with its high-end smartphones. Not even its recent releases such as Z10 and Q10 are able to see any meaningful sales since they entered the market. In fact, the company has suffered more than $2.6 billion losses between the second and the third quarter of the current fiscal due to inventory write-downs.
Canceling the two phones and embracing outsourcing opportunity is seen as a move to help the company arrest more losses in inventory write-down.
Following the handset business outsourcing deal with Foxconn, Blackberry Ltd (NASDAQ:BBRY) will now step back from the risky devices business, but its brand name will continue to live in the market.
Jakarta
The first low-cost phone from the outsourcing deal will be launched next year around April and the phone is internally code-named Jakarta. Perhaps this is a tribute to Indonesia where BBRY is still said to command the smartphone market at a time when its fortunes have waned in most of the markets.
Promise
Blackberry Ltd (NASDAQ:BBRY)’s interim CEO Mr. John Chen is promising that although the company has sealed a low-cost phone manufacturing deal with Foxconn, it will still continue to develop high-end phones. And hopes are that Foxconn will, with time, takeover all the device manufacturing responsibilities, including the high-end phones.
Investors have clearly loved the latest development in the company and shares have been seen trading northward since the deal was announced. Blackberry Ltd (NASDAQ:BBRY) is also enlisting new executives to help it achieve quick turnaround.
