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How BlackBerry Plans to Profit on BBM

By Evan Niu, CFA and Erin Kennedy - Mar 9, 2014 at 12:00PM

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BlackBerry details precisely how it plans to bring sponsored content to its BBM messaging service. Will it work in the long term?

BlackBerry's ( BB -1.20% ) BBM messaging service remains a big part of the bull case for the company's turnaround. BBM's monetization strategy has been in transition for quite some time now. Historically, BBM was always bundled with the BIS data plan, which was a revenue source for BlackBerry. However, this was never popular with carriers who wanted their own revenue for providing data, which is a big reason why BlackBerry's new operating system BB10 uses generic data plans. Add in the fact that BBM now has cross-platform support to allow iOS and Android users to use the messaging service, and suddenly it becomes very difficult to monetize.

In this segment from Friday's Tech Teardown, host Erin Kennedy and Motley Fool tech and telecom bureau chief Evan Niu discuss BlackBerry and its turnaround strategy, and how monetization of BBM could possibly play out. The company has said it is firmly against inserting sponsored content directly into chats, which would hurt the user experience. Evan goes through other ways the company is exploring using advertizing to monetize BBM, and how likely those strategies are to succeed.

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