Can Foxconn Partnership Save BlackBerry?

Struggling with a huge decline in revenue, Canadian smartphone pioneer BlackBerry on Friday announced a strategic partnership with Hon Hai Precision Industry Co., better known as Foxconn Technology. Foxconn, which claims to be the world's largest maker of electronics and components, is best known for manufacturing Apple's iPhones and iPads.

The five-year agreement between BlackBerry and Taiwan-based Foxconn calls for the manufacturer to make some of BlackBerry's upcoming devices and manage inventory, using its experience shipping the world's most successful smartphone for Apple. The devices will be made at facilities in Indonesia and Mexico, not China.

Commitment To The Market

In an earnings call discussing the company's $4.4 billion loss for the third quarter and $380 million decline in revenue, BlackBerry's new CEO said the first device to emerge from Foxconn's factories will be a 3G phone based on BlackBerry 10 that will launch first in Indonesia, according to reports.

"This partnership demonstrates BlackBerry's commitment to the device market for the long-term and our determination to [be] the innovation leader in secure end-to-end mobile solutions," said John Chen in a statement.

"Partnering with Foxconn allows BlackBerry to focus on what we do best -- iconic design, world-class security, software development and enterprise mobility management," he added.

Amid continuing chatter that BlackBerry, or at least its smartphone business may be for sale, the deal suggests the company, which was the first to mass market a cell phone that reads and sends messages, is in it for the long haul.

"Blackberry entering in partnership with Foxconn depicts that the Canadian brand still wants to focus on making hardware in longer-term," analyst Neil Shah of Counterpoint Research told us in reaction to the news.

"This also signals BlackBerry to leverage Foxconn's expertise in manufacturing touch-enabled smartphones, which BlackBerry has been weak at," he said. "This should help BlackBerry focus on key...

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