Focus on BB10 Pt.1

In the latest quarter Blackberry announced that they would be bringing another BB7 device to the portfolio. This decision made many question the purpose of this phone as the company continues to roll out the latest versions of BlackBerry 10. Many had believed that the BB7 lineup had seen the last investments (hardware) when the 9320 and the 9220 came out in 2012. In reality it should have been the last hardware investments into this lineup. To bring another phone onto market that will hamper your ability to sell the phones that matter to the company going forward is a huge blunder. To sell the phones that people want and that benefit the company the most we need to focus primarily on BlackBerry 10. One thing that the company pushed when they were building BlackBerry 10 and continue to push is focusing. Focusing on the task at hand and focusing the portfolio that it puts in front of the consumers. One area where they are severely lacking is with the carriers and the products they are putting on the shelves. Phones that came out in early 2012 should not be still available as entry level devices for consumers. Telus for example is still trying to sell the BlackBerry Curve 9320 for $29 while it also has the Q5 for $49. Selling the 9320 for 20 dollars cheaper against the Q5 doesn’t benefit Telus and doesn’t benefit BlackBerry. It has come time that BlackBerry needs to buy back the stock of older BlackBerry’s from carriers like Telus, Rogers, AT&T, Verison and have them focus primarily on BlackBerry 10. Flooding the market with new and older devices only adds to the confusion that customers have around BlackBerry and the direction they are headed. It is not beneficial to the company in the long run to continue to sell BlackBerry 7 devices in countries where people can easily afford to buy newer more expensive devices. The market share in the end is the all mighty tool that either helps your lead or keeps you down. I truly hope that this is something that BlackBerry looks at seriously or works with the carriers to sell the phones to emerging markets. North America (Minus Mexico), Europe (eastern) are perfect examples of places that can afford to spend more on a device and don’t need BlackBerry 7 clogging up the market. Most consumers don’t take the time to research what their next phone purchase will be but have perceptions of what a good/crappy device is. If we continue to remind them about the ‘old’ BlackBerry then they will believe that the ‘new’ Blackberry continues those negative traditions.

We need to focus our attention and our minds on getting the most people to BlackBerry 10 as possible. Spending the money on another BlackBerry 7 device is a waste of time and money. For emerging markets the cheaper the phone the better and bringing over 9320, 9220 and 9900 from countries like Canada, US would be a much better option then a new phone. It would focus the developed markets completely on BlackBerry 10 and provide BlackBerry with a way to reduce the inventory sitting in carriers stockrooms across the world. It could also provide BlackBerry with a way to reduce the price per phone that a person would pay and get it into more hands.

So what do you think? Is another BB7 device worth it? Can BB7 and BB10 sell together or should certain countries be primarily 1 or the other?

Advertisements

As bad as we think? #BlackBerry

It was announced recently that Windows phones overtook BlackBerry for the number 3 position in the world. This news came at a very bad time for BlackBerry as its own sales numbers weren’t nearly as high as expected. The fact many people seem to be overlooking is that BlackBerry 10 has only been available for 7 months while Windows phones have been available for just about 2 years. To compare a phone that has over a year in maturity to a new operating system seems ludicrous. The fact that there are 3 vendors pumping out Windows phones against a single vendor is another issue that needs to be taken into account. The news has been so willing and eager to jump on the father of smartphones that its like their waiting for any screw up. A new phone, new OS, lack of apps, poor marketing and terrible media have all contributed to a slower then expect start of sales. So it is truly as bad as people think? Lets take a quick peek at some numbers and see if its truly as bad as the news makes it out too seem.

The first full quarter of Lumia sales seen 2 million unit shipped. Blackberry 10 sales were roughly 1 million in the first quarter with the Z10 only being available in markets like Canada for 1 month. The Lumia sells more phones in the first quarter then BlackBerry 10.

The second quarter of Lumia sales seen 4 million units shipped to market compared to the 2.7 million units of BB10 that were shipped. The Q10 was only available in a couple markets again for a short period of time before the quarter ended. This is expected to be the biggest seller as many BlackBerry faithful have the qwerty keyboard phone.

BlackBerry 10 sales have only lasted through 2 quarters and it is extremely tough to predict the sales for the upcoming quarter. But if we were to continue to see the same growth as occurred from Q1 to Q2 then we could expect that 4.4 million units would be shipped in Q3. So lets see how that number compares to the Q3 sales of the Lumia lineup.

The third quarter of Lumia sales sent another 2.9 million units to the market. This is a 30% drop in sales from the previous quarter as the company transitioned from Windows 7 to Windows 8 phones. If we were to see the growth continue at 1.7 million units per quarter for BlackBerry then the Q3 numbers would see 4.4 million BlackBerry 10 devices sold. This means that in their respective quarters BlackBerry would sell almost 2 times what Nokia did if they had started sales together.

Obviously this number is based on the previously quarterly growth and would be subject to chances in the market, sales, etc etc. This simply proves that it isn’t all that bad when it comes to the sales of BlackBerry 10 devices. There is always room for improvement and many people were hoping to see much higher numbers then we have seen but it takes time. I believe that continuing with BlackBerry 10 till their first year portfolio runs out is the way to go. Thorsten Heinz said he wanted to take the company through the process and quitting while their are still plans on the table isn’t the right option.

There is also the issue of the company behind the product. The decline of BlackBerry has been well noted in tradition media and every step taken has been marred with bad press. In North America there isn’t the same press about the issues that Nokia is facing which may be much worse then BlackBerry. Nokia lost 98.8 million dollars in the last quarter even though they sold 7.4 million Lumia devices. The 9 months prior to the Q2 2013 results they had lost 4.1 billion dollars which included many restructuring charges as they cut massively into their employment pool. 24,500 workers will have lost their job come the end of 2013 as the company works to keep its head above water. While they have a large pool of cash they are consistently burning through it with their restructuring and quarterly losses. The position at BlackBerry while slightly better could be headed the Nokia way if things don’t start to turn around. Blackberry lost 84 million dollars in Q1 2014 as issues in Venezuela negatively affected the regions sales. Blackberry too has cut around 6,000 jobs in the previous months as they restructure the company in order to become more cost effective.

I try to write my blog posts as unbiased as possible but I will admit I have time/money invested in BlackBerry so I am biased. I don’t believe that comparing sales of Lumia devices which are in their second generation to first generation BlackBerry 10 devices is fair or accurate. Truly when we break it down the numbers are similar and with growth in the market of BB10 devices the company will continue to grow and proper. Truthfully I don’t believe that BlackBerry can take on Apple or Google but they can take on Windows and win the battle. We simply need more time to develop and push BB10 devices to market.

References:

http://en.wikipedia.org/wiki/Nokia_Lumia
http://en.wikipedia.org/wiki/Nokia#Financial_difficulties_and_restructuring
http://ca.blackberry.com/content/dam/bbCompany/Desktop/Global/PDF/Investors/Documents/2013/Q1FY14_final_filing.pdf

The Firefighter Dilemma

They’re big, strong, well trained and the ladies love them. Fire Departments across the world are well known and loved by the population because of the job they do. City administration on the other hand is starting to fall out of love with the fire department along with the other emergency services. It costs roughly 200 dollars a month to own a home in Thunder Bay. The money is spread throughout many different sectors and programs that the city offers. The money is used to repave streets, fix potholes and replace the broken bench at the park. The largest portion of your monthly bill goes to emergency services (65 dollars monthly). This works out to an annual basis of 33% of annual tax bill headed to police, fire and EMS. Now, these 3 services are all incredibly important and necessary but annual increases are forcing cities to cut in other areas to service these. Mainly due to wage increases and OT the price of policing, providing fire services and medical support continue to go up. One would think that the increase in wages is due to an increase in the work loads that these services provide. That assumption is sort of true and this is where the dilemma comes in.

Thunder Bay Fire and Rescue’s budget is roughly 25 million dollars which is an increase of 0.9% or 223,100 from last year. Thunder Bay Fire and Rescue responded to 7577 calls in 2010 (latest numbers available) or roughly $3300 per attended call. Their call rate increased from 2009 by almost 700 calls but 500 of those calls were medical in which EMS and Police would have responded as well. Calls attended (minus medical) were 3538 in 2010 which include 446 calls were they assisted or were cancelled on the way to the call. That increases the cost per call to $7066 dollars per response by a truck and its crew. Looking at the annual responses by the Fire Department since 2001 the biggest jump in calls has been medical. Of which they provide first response and basic medical attention. Fire costs in Thunder Bay are more expensive then other cities because of the sure size and layout of the city. Merging 2 into 1 and then have the population stagnate is one reason that costs are much higher then communities with similar populations. Just recently the fire department was given parity with local police officers which means a 6 million dollar cost increase over the contract (ending in 2014). That would push Thunder Bay fire to 31 million dollars annually in annual costs come 2014. So we have determined that the cost of operating a fire department in Thunder Bay is extremely expensive and that calls have remained relatively stable. This is the point where I believe we need to look at cutting costs within the Fire Department and transferring the costs to other organizations. Reducing the number of positions within Thunder Bay Fire will be the easiest way to reduce costs without affecting Fire response too much. Thunder Bay Fire has 210 members which is roughly the same as Thunder Bay Police currently have. So if we were to cut from Fire where should it go.

An increased budget should be given to Thunder Bay Police and Superior North EMS. This would allow them to hire more staff and deal with the crushing workload they are facing.

EMS responds to 25,000 calls a year with 190 front line staff. Their budget was 7.3 million dollars from the City of Thunder Bay (more from outlying communities) which increased 8.4% or $568,100. I was unable to find information on the level of calls from the same period as Thunder Bay Fire provided. I was able to find their future growth in calls and they believe it to be staggering. Superior North EMS calls the next 10 years the ‘age tsunami’ as many in Thunder Bay grow beyond the 65+ range and become “super-users” of EMS resources. The call volumes of 911 calls are expected to rise substantially while their resources continue to be stretched by a slow turn around rate at the hospital, and aging population and burn out by paramedics. If we were to reduce the costs associated with Thunder Bay Fire I believe that this is where a majority of the money should be spent. Thunder Bay’s population is aging and the resources are being stretched to their limit. If we don’t provide the service with an adequate amount of money it will break and fall apart. This service is expecting major jump in call volume while the Fire department is seeing a steady volume of calls. We can trim at the fire service in order to provide the necessary tools where they are needed the most. Superior North EMS average cost per call is $292 dollars per call which is much lower then the $3300 it costs for the Fire Department. Many of the calls they both respond too with EMS taking over and providing more extensive medical services. There is an opportunity to provide better medical care by giving paramedics the money they need to deal with the upcoming ‘age tsunami’.

Thunder Bay Police are struggling to meet the demand that the social issues of Thunder Bay are bringing on the community. More and more Thunder Bay Police are being called to deal with people who are intoxicated in a public place. The addictions issue in Thunder Bay is crushing Police, EMS and hospital resources as they deal with these people. Thunder Bay has one of the highest custody rates for a public intoxication charge then anywhere in the province. Per 100,000 people Thunder Bay Police dealt with 5,695 calls where Toronto Police only dealt with 792. Call volumes have remained relatively the same since 2006 being just north of 50,000 a year. Reportable crimes have increased though since 2006 crossing the 26,000 mark annually. Thunder Bay Police’s annual budget is 35.2 million dollars of which a majority like all departments is wages. Average cost per call is $704 when dealing with the 50,000 + calls to Thunder Bay Police or $1353 when dealing with a reportable call. Murders and domestics have been an increased issue for Thunder Bay Police to deal with above everything else. Since 2010 there have been 15 murders in Thunder Bay of which 13 have had someone charged as a result of their murder. Murders are a huge resource drain on police forces as many officers are involved in the investigation of the scene and after work. It also ties up many officers time as a result for court purposes. Domestics are another issue plaguing Thunder Bay of which many are a result of the social issues facing the city. Thunder Bay Police investigated 1,104 cases in 2004 and that number has jumped to 2,218 in 6 years. Domestics on average can take an officer off the road for 6-8 hours (almost a full shift) and have gotten so bad that Thunder Bay Police have dedicated a unit to deal with domestics now. These numbers are expected to increase as the social problems in this city continue to get worse. Talking to a Thunder Bay Police officer he said “Things are only getting worse, this year is the busiest I have ever been but I say that every year. There are more calls and we have less officers on the road” – 7 year veteran of Thunder Bay Police.

This blog post is not meant to say that Thunder Bay Fire doesn’t do a good job or doesn’t deserve the wages they earn. If a perfect world we could keep paying them that and hire on more to make their jobs easier but this is not a perfect world. We need to make the tough decisions in order to have a strong emergency service in the future. We need to use the stats to make the proper decisions and the tough ones. Thunder Bay fire’s calls are likely to remain stable which means there is room to cut and save some money for other departments whose calls are increasing. I thank all of the emergency services for the job that they do and am glad that there are people willing to do those jobs. We need to make the tough decisions and cut where we can to provide for those who need it. With an aging population and the expectation that the population will drop there comes a time when the money wont be there and cuts will be much more severe then if we do it now.

I would like to know the thoughts of any emergency responders on this topic. Whats it like in your city? Whats your city doing about it. Thunder Bay Fire/EMS and Police what are your thoughts on this topic.

References:

http://www.thunderbay.ca/Assets/Living/Fire+$!26+Rescue+Services/docs/2012-2016+Strategic+Master+Fire+Plan.pdf -> Page 12 table 4
http://www.thunderbay.ca/Assets/City+Government/Finance+$!26+Budgets/docs/Budget+2013/2013+Tax+Supported+Community.pdf -> Page 4-2 and 4-3
http://www.tbnewswatch.com/news/290757/Parity-problems
http://www.superiornorthems.com/Assets/Superior+North+EMS/docs/Superior+North+EMS+Strategic+Plan+2013-2017.pdf
http://www.tbnewswatch.com/news/221391/Rising-domestics
http://www.thunderbaypolice.ca/sites/default/files/pdfs/Business%2BPlan%2B2012%2Bto%2B2014.pdf -> page 9,12 and 13
http://www.thunderbay.ca/Assets/City+Government/Finance+$!26+Budgets/docs/Budget+2013/2013+Tax+Supported+Outside+Boards.pdf -> page 9-6 to 9-11

Rumour Mill

Update: Tbaytel is taking part in the 700 Mhz spectrum auction which is designed to help launch LTE in remote areas of the country. The 700 Mhz spectrum travels farther and penetrates in buildings better then other spectrum. It should help companies keep costs down when launching LTE in less populated centers. It was confirmed by @mobilesyrup today that Tbaytel is taking part but there is no idea yet as to how much money they are willing to spend.

A couple months ago I was told that Tbaytel was looking at launching its own LTE network. Massive investment has been poured into the mobility portion of the company to expand the reach of the current towers. I truly believe that there is more afoot then the company is letting on. While there are still dead spots in town the majority of the city has above average coverage already. This extra investment would only be necessary for the 4G network if Tbaytel truly believed that there was a huge influx of new customers signing on. Add to the fact that Rogers has launched their LTE MAXX system which uses a different bandwith to run their service and opens up room on their LTE service. Rogers has a strong partnership already with Tbaytel and it is the one that helped them launch the 4G network. It is conceivable that Rogers uses some of the available LTE to help Tbaytel bring that speed here to Northwestern Ontario. I believe that a November/December launch of the Network is something that could be considered a real option. If true it seems that they have learned how to properly roll out a new network since the majority of the work is coming in Northwestern Ontario’s 2 largest centers.

Tbaytel - Thunder Bay

Tbaytel - Kenora

The top item shows the investment into Thunder Bay over the past/coming months. 16 towers have been added or will have received an upgrade all across the city. All of these projects are within a very short period of time as well. To me it would say that they are pushing for a goal which should be around the corner very shortly.

Below is the Kenora upgrades. 5 projects for the city which is a major investment for a city of that size. I don’t really know much about how the coverage is in that area but a investment like that has to be for something big.

I could totally be of on this one. It could simply be the end product of a major increase in spending from Tbaytel towards their coverage. The comment about LTE coming from a source and the potential opening of LTE space on Rogers network seem to come together like a puzzle. The only thing missing if this was to happen would be the date. With towers still being put up in September they miss the back to school rush for the latest phones but a Late November/Early December launch would be perfect for the company. They could grab all the people who jumped on 3 year plans when the 4G network was launched 3 years ago. Having LTE could being Tbaytel on a level playing field with Bell and Telus in the mobile wars.