Why Pentagon’s Decision to Deploy 80,000 Blackberry Devices Matters

Last week Pentagon announced that it will deploy about 80,000 BlackBerry devices this year. It seems that this announcement played a significant role in helping BlackBerry stocks to go up last week. The Citron report, too, was bullish on the company. Of course, short term analysis of stock prices may be a complete waste of time. However this doesn’t necessarily mean that every day news isn’t important. In fact, it helps us get a better understanding of the company’s general well-being. And when a major department of the US administration stands behind BlackBerry, it is quite natural that investors regain confidence. This is also an opportunity for investors to learn a lesson or two about smart investing. Successful investors always ignore short term fluctuations in the market. They save enough money before taking the plunge and then invest for long terms.

As for the new development, the deployment of BlackBerry devices by Pentagon itself is not big news. It may improve sales a bit, but it is unlikely to have any major impact on the company’s balance sheet. This news is still important because it shows that consumers and even government departments still have a lot of confidence left in BlackBerry.

Pentagon is already an existing customer of BlackBerry. They also run BlackBerry’s enterprise device management systems. In fact, Pentagon was among the first few organizations that approved BES 10. Pentagon’s decision to continue using BlackBerry devices is a clear indication that they haven’t lost faith in BlackBerry’s longevity. This is great news for the IT departments in other organizations.
It is true that BlackBerry made several huge communication mistakes in the last few years. Even worse were those negative media headlines that seemed to suggest that BlackBerry’s days were numbered.

Needless to say, all that negative publicity eroded investor confidence and caused BlackBerry stock prices to plummet.

Now that stock sentiment has improved, business sentiment, too, should improve.

BlackBerry faced a lot of negative media coverage over the last 2 years. The media was pounding the company for several reasons. While some of them were device related, others were OS-related. Initially the media claimed that the Canadian phone maker would never launch BlackBerry 10. And when at last BlackBerry launched its much awaited operating system there was criticism about several features of the OS and hardware. However, the real damage was the dramatic fall in the number of sales. When sales hit a new low, talks of BlackBerry exiting the hardware market or going bankrupt gained currency. BlackBerry, too, made some big communication mistakes. But more than anything else, it was the negative media coverage that caused both consumers and investors to lose their confidence in BlackBerry.

But today, we are beginning to witness the reverse trend. BlackBerry CEO John Chen’s different communication strategy, too, helped BlackBerry’s cause. Now enterprise customers are again reading positive messages about BlackBerry’s dominance in enterprise. Several independent media agencies, too, published reports about a possible revival of BlackBerry. These developments help the message spread. This also changes people’s perception of BlackBerry.

Customer sentiment plays a significant role in helping the business. The Pentagon news is a great case in point.