BlackBerry's Oxymoronic Opinion of Tablets

BlackBerry (NASDAQ: BBRY  ) CEO Thorsten Heins is just sounding silly now. In a recent interview with Bloomberg, Heins expresses skepticism over the broader tablet movement.

"In five years I don't think there'll be a reason to have a tablet anymore," Heins is quoted as saying, "Maybe a big screen in your workspace, but not a tablet as such. Tablets themselves are not a good business model."

Oddly enough, Heins goes on to say, "In five years, I see BlackBerry to be the absolute leader in mobile computing -- that's what we're aiming for. I want to gain as much market share as I can, but not by being a copycat."

That's an oxymoron if I've ever heard one. Mobile computing includes a secular shift toward smartphones and tablets, but you could also arguably include shifting from desktops to laptops within the PC market. Of the three devices that embody mobile computing -- smartphones, tablets, and laptops -- BlackBerry only sells one.

It's certainly true that tablets have not been a good business for BlackBerry. Shortly after jumping into the market with the PlayBook, the company promptly recorded a pre-tax non-cash charge of $485 million related to a glut of unsold inventory. While PlayBook unit shipments haven't been consistent, to the company's credit they're holding up relatively well for a device that's two years old and only received minor upgrades. That may also be a function of the price dropping from $500 to under $200 over the past two years.

Source: BlackBerry. Fiscal quarters shown.

The tablet market is also much harder to crack competitively. Not only does BlackBerry have to compete with market leader Apple (NASDAQ: AAPL  ) and its iPad and iPad Mini, but on the low end habitual disrupters Amazon.com (NASDAQ: AMZN  ) and Google (NASDAQ: GOOGL  ) are perfectly content selling hardware at cost.

The e-tail and search giants have ensured that there really isn't much in the way of hardware margins down there, which is where the PlayBook is currently positioned. Of course, the tablet market is proving to be a good business model for Apple, Amazon, and Google. The iPad remains Apple's fastest-growing new product category, Amazon has expanded its content ecosystem, and Google has dramatically broadened the global reach of its ads and services.

Just because BlackBerry's tablet business isn't good doesn't mean others can't enjoy it. Sorry, Heins, but it's simply not possible to become the "absolute leader in mobile computing" without tablets.

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Read/Post Comments (20) | Recommend This Article (3)

Comments from our Foolish Readers

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  • Report this Comment On May 01, 2013, at 7:20 AM, infektu wrote:

    I think TH's statement is grossly misinterpreted across "tech media", whatever that means.

    Yoy say that PB sales are "holding up relatively well for a device that's two years old and only received minor upgrades."

    The only upgrade was a native email client. Hardly a minor one. In its current state (before an upgrade from PB OS 2.1 to BB10) it is a strong workhorse missing some important cross-platform apps (Skype, notably). As these apps become available for Q10, then Z10, expect them to swiftly appear as PB BB10 offerings.

    Back to the "tablet is transitory" issue: some people will simply never buy one. They might use one provided at work and simply use their smartphone to move across their digital "universe" and unify it (home media HD and screen, home/work PCs/laptops, backup HDs).

    TH and BBRY _currently_ think the things are moving towards this. Right or wrong, they have learned the hard lesson to listen to the outside world and the BB10 platform being deployed right now allows evolution, branching out and morphing. In other words, make no mistake, if tablets will prove to be a steady need 5 years from now, BBRY will be there. Starting with a new full7" LTE this fall.

  • Report this Comment On May 01, 2013, at 10:28 AM, Rampil wrote:

    While this CEO is living on a different planet, the author of the article ought to invest in an English language dictionary and look up the meaning of oxymoron!

  • Report this Comment On May 01, 2013, at 10:35 AM, BlackberryIsKing wrote:

    The only moron here is the author. TH is a genius. CEO of the year. You are a moron Evan, and clearly have no idea what he is talking about. Clueless.

    Long Blackberry.

  • Report this Comment On May 01, 2013, at 10:35 AM, cbglobal wrote:

    I do not own a tablet; a smartphone; a Keurig or Verismo coffee maker; a hybrid automobile; and just about everything else I am suppose to have to be hip and cool. I do have the one thing these people do not; and that is the money that these things purchase.

  • Report this Comment On May 01, 2013, at 10:36 AM, Jjkiam wrote:

    The recent opinion offered by Thorsten Hein will go down with Steve Ballmer's now infamous quote about the potential for the Iphone as one of if not the DUMBEST statement from a tech CEO EVER!!!

    Allso I would love to know how much money BBRY is paying for blogs to prop up it's efforts. Must be a HUGE amount!

  • Report this Comment On May 01, 2013, at 11:12 AM, STbalok wrote:

    Seriously? You don't think that technology will change significantly in five years? Come on folks. What would you have said if I told you back in 2008 that in 5 years there would be no need for a home telephone? What if I told you back in 2008 that in five years there would be no need for a CD/DVD drive in your mobile computer or home entertainment system?

    I happen to agree with TH. I would love to simply cary my mobile multifunction device where ever I go and have it seamlessly connect to the various I/O devices available . Isn't that what he is suggesting?

  • Report this Comment On May 01, 2013, at 11:35 AM, misledbyfools wrote:

    Predicting the future is a tough task, especially in the world of evolving technology and human consumer choices. The product cycle and hence the innovation cycle has been shrinking and everyone seems to be the expert here. Time will tell, however, just look to your past analysis five years or more ago and see how good you really are at predictions. Heck, you can't even agree on the state of things today, so how much do you think anyone should value your guess for the future a long five years of tech development and innovation away. I don't think you have a real crystal ball....loser. Ha ha ha. you are just ridiculous.

  • Report this Comment On May 01, 2013, at 11:41 AM, cbglobal wrote:

    "The best investment you can make is a house. They only go up in price." I'll bet we can find an old Motley Fool article that says that.

  • Report this Comment On May 01, 2013, at 12:12 PM, Chippy55 wrote:

    The same people who own tablets also own a Yugo, it's cheap and gets you from Point A to Point B. Seriously, what is a tablet good for? And how many people bought one who also use a desktop, or laptop, or cell phone? If Steve Jobs would have said it then it would be written in the rocks, like Apple stock which dropped like one from $703 to under 400. A gravity defying rock that took months, granted, but still.

  • Report this Comment On May 01, 2013, at 12:31 PM, suavan1 wrote:

    The author is a meat slobber!

  • Report this Comment On May 01, 2013, at 12:49 PM, magnaman1969 wrote:

    The definition of a tablet will be redefined..whats the difference beta Phablet and a Tablet?

    The lines are blurred right now.

    Having one device that can connect with the "Internet of Things" as Heins stated makes sense.

    Apple wants to sell you multiple devices.

    BlackBerry envisions ONE powerful device to do it all..connecting with other hardware interfaces as needed.

    As smartphones became more powerful and had more storage capacity it impacted iPod /MP3 player sales. As they continue to become more powerful they will encompass more and more functional aspects of our lives and become almost an extension of us.

    Heins sees this.

  • Report this Comment On May 01, 2013, at 1:15 PM, advcomputer1000 wrote:

    I think the author is an idiot. Using a sensational headline to get page-views.

    TH is brilliant and I believe his words are being taken out of context.

    -J

  • Report this Comment On May 01, 2013, at 1:42 PM, verces wrote:

    T. Heins claims is absolutely true the Tablet is a toy for your kids. I have not touched my tablet for months and I do most of my email 80% of the time in my smartphone, I would visit my PC only if there is something i wanted to print and visualize it in a bigger screen. I would support the idea of using your smartphone as PC with a docking station for a bigger screen if needed. And I'm pretty sure that there is already some work going with others about it. PC is almost a century old anyways, I guess its time for it be revolutionized.

  • Report this Comment On May 01, 2013, at 1:59 PM, BlackberryIsKing wrote:

    What a completely idiotic article. TH is a genius, CEO of the year. This article is embarrassing for the author, that clearly has no clue what he is talking about. Give it up. Can't believe this drivel was even posted.

    TH is right, the tablet has a very limited future. Kiddy toy or for very old people. The BB10 phones are replacing it already. They are superior to any tablet. Long Blackberry, short Apple.

    Bye Bye InfoThatHelp. No more comments from you. Wahoooo!

  • Report this Comment On May 01, 2013, at 3:27 PM, infektu wrote:

    You quote TH as :

    "In five years I don't think there'll be a reason to have a tablet anymore".

    And?

    This is what he thinks. Does this mean that if he is not right, BBRY won't be making a tablet?

    Whatever...

    it would be great to pause 2 seconds before writing ten paragraphs.

  • Report this Comment On May 01, 2013, at 4:52 PM, PastorStephen wrote:

    I think the point is that it is his opinion that somewhere down the road users will not have a smart phone and a tablet. Everything will be done with only one device.

  • Report this Comment On May 01, 2013, at 5:08 PM, jelp2 wrote:

    Evan, you stick to your silly articles and leave the innovating to others,,,,please. Until you stop looking in the rear view mirror, you will have no idea of what's ahead.

  • Report this Comment On May 01, 2013, at 9:56 PM, RandomMeaning wrote:

    Regardless of what anyone thinks of his comments, his timing is terrible. It's taking a lot of attention away from the Q10 launch. That's what he should be talking about. He should have known better.

  • Report this Comment On May 02, 2013, at 12:24 AM, BlackberryIsKing wrote:

    Actually, the timing was perfect, and well thought out. It puts Blackberry in the center of the news, and then the Q10 will overshadow the tablet comments. BTW, TH is totally right. CEO of the year. The man is a genius. Long Blackberry.

  • Report this Comment On May 02, 2013, at 3:40 PM, Smilinjax wrote:

    Amazing how people/shorties can totally take something and spin for their own purposes.

    What Thor said and what Apple confirmed is the tablet business isn't that profitable, the product "tablet" is going to be the hula hoop of the Aughties.

    "go where the market is going not where it is" sound familar???

    good luck with your negative attack campaign on a profitable, world leading mobile computing company.

    -I am long bbry

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