BlackBerry's Break Up with T-Mobile Will Only Hurt Themselves
BlackBerry is ending its partnership with T-Mobile after a very public spat, but the decision to take a stand makes it seem like BlackBerry is working really hard to pound the nails into its own coffin.
BlackBerry is ending its partnership with T-Mobile after a very public spat, but the decision to take a stand makes it seem like BlackBerry is working really hard to pound the nails into its own coffin. The phone manufacturer announced they will be cutting ties with T-Mobile on April 25th when their contract expires. BlackBerry is not interested in renegotiating the deal after the two companies battled it out over a T-Mobile promotion that came off as a bit disrespectful to the struggling handset maker.
In mid-February, T-Mobile offered a promotion for existing T-Mobile Blackberry holders to trade in their device for an iPhone 5S with $0 down when they signed onto a new T-Mobile contract. The struggling BlackBerry does not have many customers left, but those remaining are fiercely loyal and so they took to social media to express their discontent. Blackberry, not surprisingly, was none too pleased about the promotion as well, and took to their blog to express their sentiments towards T-Mobile:
“I can assure you that we are outraged too. What puzzles me more is that T-Mobile did not speak with us before or after they launched this clearly inappropriate and ill-conceived marketing promotion. To the BlackBerry user community, I want to extend our deepest gratitude. Your passion motivates us every day as we navigate our turnaround."
Finally, to T-Mobile, I would like to remind you that our long-standing partnership was once productive and profitable for both BlackBerry and T-Mobile."
Even though BlackBerry has less than 1 percent of U.S. smartphone market share, and has taken brutal financial hits over the last several years, the company still felt the need to publicly fire T-Mobile. That’s right, the phone provider with 1 percent of the market wanted to be sure the world knew it fired the No. 4 mobile provider in the nation. "Regretfully, at this time, our strategies are not complementary and we must act in the best interest of our BlackBerry customers," said Blackberry CEO John Chen as he gave T-Mobile the pink slip: "We hope to work with T-Mobile again in the future when our business strategies are aligned."
Unfortunately, T-Mobile's response is essentially, "You can't fire us, because we already quit." The company stopped carrying Blackberry products in retail stores six months ago, and even John Legere, the CEO of T Mobile, doesn’t seem bothered about the wayward promotion. While T-Mobile has not issued an official statement on the matter, Legere took to Twitter yesterday to address the end of contract:
@WaltBTIG are you serious or joking? We value all customers but this is 1+% of our base total and a small fraction of what we add quarterly— John Legere (@JohnLegere) April 2, 2014
@ArmandoRaynal @TMobile I can’t, for the life of me, understand why @BlackBerry would take choices away from customers— John Legere (@JohnLegere) April 2, 2014
The bottom line is that BlackBerry's bottom line requires T-Mobile more than T-Mobile needs BlackBerry's phones. Their own pride demands that they respond to T-Mobile's insult, but pride won't suddenly restore their sales or lost jobs.
Chen alluded in this blog post that BlackBerry has “an offer in the works” designed especially for T-Mobile customers, so perhaps Blackberry is plotting their own effort to take those customers with them when they go. But will T-Mobile even notice that they're gone?