BlackBerry Limited Is Joining the Car Race
Forget the Apple Inc. (NASDAQ:AAPL) “iPhone;” BlackBerry Limited’s (NASDAQ:BBRY) next project could be even bigger. The implications of this deal could have a big impact on the BBRY stock price.
In a deal announced Wednesday, BlackBerry revealed it is now partnering with Luxoft Holding, Inc. (NYSE:LXFT) to launch its own semi-autonomous driving technology.
BlackBerry’s subsidiary, QNX Software Systems, will be working on advanced driver assistance systems (ADAS) with help from Luxoft’s augmented reality software system, which can highlight and navigate through routes, roads, destinations, and everything in between that a driver experiences daily. (Source: “Luxoft, BlackBerry Team To Make Cars Semiautonomous,” Investor’s Business Daily, December 16, 2015.)
Basically, BlackBerry’s “QNX” operating system (OS) will power Luxoft’s self-driving features in cars that run on the BlackBerry software. QNX already powers the infotainment systems in more than 50 million cars from many famous automakers, including Audi, BMW, Chrysler, Ford, General Motors, Honda, Mercedes-Benz, and Toyota. (Source: “50 Million Vehicles and Counting: QNX Achieves New Milestone in Automotive Market,” QNX.com, January 5, 2015.)
Simply put, if your car is powered by the QNX OS, everything from the audio and video entertainment devices to car computers, safety features, and various other Wi-Fi functions might be running on the BlackBerry operating system. Topping it off, the QNX software also works with both Apple’s “CarPlay” and Alphabet’s “Android Auto” plug-ins.
The idea of semi-autonomous and fully driverless cars is no longer science fiction; it’s becoming a reality! Not one or two, but almost all big companies are now investing in this technology. Owing to its head start, Alphabet Inc (NASDAQ:GOOG) currently holds the most advanced version of the technology, with the most cars licensed under its driverless technology, followed by Tesla Motors, Inc. and QNX customer Mercedes-Benz. In fact, Google’s driverless car technology bet is so humongous, that Alphabet is going to make it a stand-alone company in 2016, separating it from the rest of its businesses.
Archrival Apple is likewise rumored to be working on an electric vehicle with autonomous driving capabilities. The project, dubbed “Project Titan,” is already underway and is expected to be revealed in the next two years.
Despite weaknesses on the hardware side, where BlackBerry’s CEO, John Chen, is actively working on a turnaround, Chen knows that BlackBerry’s ultimate strength has always been in its software.
In addition to QNX, BlackBerry’s enterprise management software is also going strong. Forrester reports that the company’s BlackBerry Enterprise Server (BES) takes a spot near the top of the leaderboard, following International Business Machines Corporation and VMware, Inc., but surpassing Microsoft Corporation and SAP SE. (Source: “The Forrester Wave™: Enterprise Mobile Management, Q4 2015,” Citrix, December 4, 2015.)
The Bottom Line on BBRY Stock
Chen is working hard to save the company from extinction and it would be unjust to not acknowledge his efforts. BlackBerry reports earnings in two days and I’m optimistic that we’ll soon be seeing his efforts bearing fruit. The CEO has promised to turn the company around in the next two years and the company’s new developments certainly look promising for BBRY stock.
John Chen may have finally learned the lesson—those who fail to evolve, fail to exist.
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