BlackBerry’s rise cools as DoD says ‘no new orders’ placed


A Blackberry logo is seen at the Blackberry campus in Waterloo, in this September 23, 2013, file photo. (MARK BLINCH/REUTERS)

BlackBerry lost a significant chunk of earlier stock gains in Thursday trading after a statement from the Defense Department deflated a story that sent the stock up earlier in the week.

The Canadian smartphone company closed up more than 9 percent Tuesday thanks to a Jan. 16 release from the Defense Information Systems Agency saying that it was bringing new “unclassified mobility capability” to 100,000 Defense employees and mentioned that it also supports 80,0000 BlackBerry phones.

Many interpreted that to mean that there was a new order placed for all those phones, which would be a bright spot for BlackBerry as it reworks its efforts yet again to focus on its strength among business and government customers. But the Department of Defense poked holes in that theory in a statement to The Verge that said “absolutely no new orders” had been placed for BlackBerry devices. The announcement, in fact, was merely referring to the number of existing BlackBerry devices its employees had that would now be supported on Defense networks.

Company shares fell more than 5 percent in afternoon trading. BlackBerry spokesman Adam Emery declined to comment on the company’s stock performance. The DISA did not immediately respond to a request for comment.

Rather than being a plus for BlackBerry, the fact that the release also touted support for “1,800 unclassified mobile devices,” including Apple’s iPad and iPhone, as well as Samsung’s Galaxy 10.1 tablet and Galaxy 3S, probably should have indicated that this wasn’t a big win.

If anything, seeing competitors’ devices touted over its own in a release from an agency that’s been one of its strongholds should raise alarm bells for BlackBerry investors. The Pentagon has already added Apple and Samsung to the short ­list of commercial mobile devices that are cleared for use at its offices — a shift attributed to employee requests to use other smartphones.

BlackBerry, now under the leadership of interim chief executive John Chen, has been clear that it’s willing to stand and fight — even if it means taking its much-admired security capabilities onto other devices.

In an open letter to customers last month, Chen articulated that vision while refuting rumors that the company is on its last legs.

“Our ‘for sale’ sign has been taken down and we are here to stay,” Chen said. “The investments you’ve made in BlackBerry infrastructure and solutions are secure.”

And the company was on the offensive again this week, with the head of BlackBerry Enterprise Services specifically attacking Samsung and its competing Knox device management program as insecure.

Samsung is “still battle testing its enterprise platform and fixing security bugs,” wrote John Sims, the company’s president of global enterprise services. In that post, Sims also noted that BlackBery is the only firm with an “Authority To Operate” certification at the Department of Defense.

Despite that optimism, Chen certainly has his work cut out for him, particularly after reporting a $4.4 billion loss for its third quarter last month. The company said Tuesday that it will sell the “majority” of its Canadian real estate and lease back the properties — an announcement that also buoyed stock prices. But Canadians need not fear that the firm is abandoning its homeland.

“BlackBerry remains committed to being headquartered in Waterloo and having a strong presence in Canada,” Chen promised in the release.

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Hayley Tsukayama covers consumer technology for The Washington Post.
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