For months now, rumours have swirled that BlackBerry Ltd. (TSX:BB)(NASDAQ:BBRY) will be making an Android-powered phone. And now we’re starting to see some more specifics.
In the early hours of Wednesday morning, Evan Blass—better known as @evleaks on Twitter—tweeted “BlackBerry Venice confirmed for November release on all four national carriers.” Then less than two hours later, he tweeted a new leaked image of the Venice phone, which features a sliding keyboard and the Android operating system.
So, will the Venice be a success? And what does this mean for BlackBerry’s shares?
Trying to turn the ship around
It’s no secret that BlackBerry is shifting its focus from handsets to enterprise software. Unfortunately, the company’s brand is suffering as handset sales continue to decline. In other words, BlackBerry is still known as a failing company. And this has affected software sales, too.
As long as BlackBerry sells handsets, it’s very important that the company stop the decline. But this is proving to be very difficult. As handset sales decline, software developers lose incentive to make BlackBerry applications. This hurts the appeal of BlackBerry’s handsets, which accelerates the decline. And so the cycle continues.
To help deal with this problem, BlackBerry has allowed Android applications to work on its handsets. But this is only a partial solution. Android apps were not designed to run on BlackBerry handsets, especially those with a small screen (such as the Classic) or a square-shaped display (such as the Passport). So, an Android-powered phone seems like the logical next step.
Will it sell?
There are reasons to be optimistic. The Venice features the same Android operating system that already dominates the market, and has a couple of key advantages over competing handsets.
First of all, BlackBerry is the clear leader in security, something that has only become more important in recent years. An Android-powered phone comes with extra security challenges, but BlackBerry should still do a better job than competing manufacturers. Secondly, the Venice will feature a sliding keyboard, something that will help many consumers be more productive.
But I still have my doubts. You can never underestimate the power of a brand, and BlackBerry’s poor image could easily be enough to hold back sales. And thanks to BlackBerry’s decline, consumers have gotten more used to touchscreen keyboards anyways.
What does this mean for BlackBerry?
This is likely BlackBerry’s last chance to gain any traction in the smartphone market. If it fails, the company may have to abandon its handset business altogether.
That wouldn’t necessarily be the worst outcome. It would transform the company from a struggling handset manufacturer into a fast-growing software company. But it would still be a major change, one that could cause some serious short-term pain. Thus, if you’re looking for quick results or a sure thing, then BlackBerry shares are simply not for you.
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Fool contributor Benjamin Sinclair has no position in any stocks mentioned.