BlackBerry Ltd.: Now Officially Out of Apple's League

In dumping T-Mobile USA (NYSE: TMUS  ) as a carrier, BlackBerry Ltd. (NASDAQ: BBRY  ) has left the ranks of major smartphone suppliers. Apple, Google, and Microsoft all sell smartphones through each of the four major U.S. telecom carriers. Fool contributor Tim Beyers explains the implications for BlackBerry in the following video.

There isn't much for either company to mourn. BlackBerry now accounts for near zero U.S. market share according to the latest figures from Consumer Intelligence Research Partners. T-Mobile, meanwhile, is the nation's fourth-largest carrier. Parting ways may be more of a PR problem than a profit problem.

What caused the rift? Promotions strategy. In September, T-Mobile stopped carrying BlackBerry handsets in its stores. Months later, the carrier began running ads prompting users to switch to the iPhone. BlackBerry responded by terminating the relationship.

Investors' reactions to the news have been mixed. Shares of BlackBerry fell more than 10% between March 28 and April 3, a period that included mediocre earnings news. T-Mobile stock rose modestly during the same period.

Tim says the BlackBerry sell-off is probably an overreaction given the company's newfound emphasis on software and services, which should naturally reduce its dependence on carrier whimsy. Continued approval of BlackBerry handsets by U.S. Defense Department employees should also provide a buffer.

Even so, Tim says this is a stock story in transition from that of a major international smartphone supplier to that of a niche supplier of mobile software and services. Do you agree? Please leave a comment below to let us know what you think, and whether you would buy, sell, or short BlackBerry stock at current prices

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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 05, 2014, at 12:57 AM, devvvv wrote:

    I certainly agree with you, so as a small niche company, as CEO of BlackBerry (John Chen) down sizes the company, it stands to reason share price will fall accordingly. It's really too bad BlackBerry does not seek out innovation is desperation, in any manner possible. It would be more beneficial for it to grow and develop employment, rather then the opposite.

  • Report this Comment On April 05, 2014, at 7:41 AM, Bassdrone wrote:

    seems to me $BBRY is being prepped for either sell-off or a chop up. Enterprise Mobile Management/security, Messaging & Devices, M2M/IoT (qnx). Maybe even a spin-off of QNX ?

  • Report this Comment On April 05, 2014, at 8:44 AM, melegross wrote:

    This is another in a bunch of articles that are total crap. I really hate using words like that, but the author doesn't know what he's talking about. Blackberry sales last quarter were under a million phones. The entire DOD has about 600,000 Blackberry phones. How can sales to the DOD be a stealing factor? How can it be now that they have publicly said that they're investigating other phones?

    And how many of those DOD employees have BB7 because they need the security they offer, and how many have them because the odd, like so many other large organizations in the last simply issues everyone the same phone? I'd be willing to bet that no more than a few tens of thousands there actually need this security level. That's no sales at all.

    And if Tim bothered to look at the financials, he would see that every aspect of Blackberry's business fell last quarter. Yes, that includes software and services. This company is a loser.

  • Report this Comment On April 05, 2014, at 2:18 PM, devvvv wrote:

    I really can't see someone buying BlackBerry when it cost more to operate then what they profit

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