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BlackBerry's Collapse Leaves Room for Microsoft's Lumia

The end is nigh for BlackBerry phones, and that could mark a new beginning for Microsoft's Lumia lineup.



While BlackBerry CEO John Chen said the phone maker's sales were "bottoming out" this spring, they really bottomed out last week, with BlackBerry selling only 800,000 handsets in the past quarter. Chen then introduced the new Android-powered BlackBerry Priv, which seemed to truly befuddle him.

BlackBerry won't disappear as a company. Through moves such as buying mobile device management firm Good Technology, it's transitioning into the leading provider of business management and security software for all kinds of mobile devices. Its QNX platform plays a big role in cars and in the Internet of Things. But this is likely the end of the BlackBerry phone story.
That means it's a huge opportunity for Microsoft, and one that Microsoft needs to take advantage of when it launches its Lumia 950 models on Oct. 6.

Much has been leaked about the Lumia 950 and Lumia 950XL, which will finally bring Microsoft the high-end phones it has lacked in its lineup for about a year. From the leaks, it looks like the two are keeping pace with the state of the art while not pushing any boundaries. The quad-HD screens, Qualcomm Snapdragon 810 processors, and 20-megapixel cameras will fit in well with the Samsung Galaxy S6s and iPhone 6s Pluses of the world.

With a full, new Lumia lineup coming next week, Microsoft has a chance to sweep up remaining BlackBerry clients and block corporate transitions to Android. Windows Phone has plenty of enterprise-friendly features including VPN and mobile device management support, full-device encryption, and enterprise Wi-Fi support.

But its deployment has been stalled because nobody who can afford more than a midrange device has actually wanted Windows phones. Executives cling to their BlackBerrys or switch to iPhone rather than stepping down to a dull, midrange Lumia 830 or Lumia 640. App developers, who like to carry sexy devices, see Windows Phone as a low-end afterthought rather than a major target platform.
That's where the 950 and 950XL come in. Their specs are better than the new Nexus 5Xand Nexus 6P phones, with bigger batteries, expandable memory, and a better screen on the smaller device. And you know the 5X and 6P are going to be hits with the kinds of software developers and IT folks who make enterprise purchasing decisions. Microsoft's bar is low—it just needs to make some phones that techies wouldn't be embarrassed to carry—but it hasn't vaulted over even that bar recently.

Windows 10 is already looking like a hit, with businesses that shied away from Windows 8 and 8.1 deciding to make the jump from 7 to 10. That makes Microsoft's story about extending Windows 10 apps onto your phone actually compelling. They're now syncing up with an OS that actually has momentum.

But as with everything, the demons lurk in the execution. Microsoft has had a horrible track record of carrier exclusive devices, for instance. If it can't make its new Lumia lineup available on all U.S. carriers, they will fail just as Microsoft's several AT&T and Verizon exclusives failed. I can't emphasize this enough. The No. 1 way to kill Windows Mobile 10 in its crib would be to hand an exclusive to one carrier.

And Microsoft does have to clearly communicate Lumia's security and productivity advantages over Android, and especially over Apple. Apple's deal with IBM is bringing iPhones into big business in a large-scale, formal way, and Microsoft has a tendency to take enterprise customers for granted. That can't happen here. But with the former BlackBerry customers in play, Windows 10 looking like a successful product, and the Lumia 950 appearing like a phone executives wouldn't be ashamed to use, the stars could finally be aligned for Microsoft's mobile strategy.


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