BlackBerry's Patents Could Fetch a Tidy Sum, but Smartphone Division May be Worthless

Waterloo's BlackBerry is for sale. But how much is it worth?

The Canadian company's treasure trove of patents and advanced software could fetch a tidy sum—up to $5 billion or more, some analysts estimate—but its formerly glorious smartphone division is being considered worthless by many.

Raymond James Ltd. stated recently that BlackBerrys services business and hardware unit would have zero value in an acquisition, given the fact that substantial phone losses render fee-based revenue earned from subscribers virtually negligible.

BMO says that BlackBerry's patent portfolio alone is worth more than $1 billion, however. Currently trading for about $10 per share, the company's market cap is just over $5 billion. BlackBerry has roughly $3 billion in cash and short-term investments.

It was only in 2011 that the smartphone pioneer was generating net income of more than $3 billion. Now BlackBerry struggles to remain profitable on a quarterly basis.

“We struggle to assign any value to the hardware business given the belief the most logical acquirer of BlackBerry would likely attempt to transition BlackBerry’s subscriber base to its own competing smartphone products or ecosystem,” Canaccord Genuity analyst Michael Walkley said earlier this month.

Waterloo, Ontario, Canada

Research In Motion (RIM), a global leader in wireless innovation, revolutionized the mobile industry with the introduction of the BlackBerry solution in 1999. Since then, BlackBerry products and services have continued to change the way millions of people around the world stay connected. With the launch of BlackBerry 10, we have re-designed, re-engineered and re-invented BlackBerry. Not only... more

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Knowlton Thomas

Knowlton Thomas

Knowlton is the managing editor of Techvibes and author of Tempest Bound. Based in Vancouver, Knowlton has been published in national publications and has also appeared on television and radio. Previously he was an editor for New Westminster weekly The Other Press and served on its board of directors. When not working, Knowlton enjoys hiking, tennis, and martial arts. more

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