BlackBerry’s AtHoc Software Deal with the US Senate

BlackBerry’s AtHoc Software Deal with the US Senate


Aug. 2 2016, Updated 11:04 a.m. ET

The U.S. Senate chose BlackBerry’s AtHoc software

In the previous part of this series, we discussed how BlackBerry’s (BBRY) software and services business has become the most important business for BlackBerry. BlackBerry set itself a target of 30% revenue growth for its software segment for fiscal 2017, and this can only happen if it continues to win new customer deals. One deal came from the U.S. Senate, which chose BlackBerry’s AtHoc software to strengthen its “emergency mass notification system.” BlackBerry had acquired AtHoc last year. It’s a crisis communication company that helps send emergency alerts to employees.

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This deal came as a major relief for BlackBerry. A few days ago, the U.S. Senate announced it will no longer procure new smartphones from BlackBerry, favoring Apple (AAPL) iPhones and Samsung (SSNLF) smartphones. This deal came on top of other important deals that BlackBerry has managed to win for its software business.

BlackBerry has grown its customers rapidly

According to BlackBerry, “The Government of Canada purchased multiple enterprise software products, including the EMM, the BBM Protected and the Secure Voice. This really demonstrates the differentiation of our broad software portfolio over a lot of our competitors. AtHoc Services which is among our secure messaging offerings had wins in multiple verticals. In the education with Macquarie University, in transportation with Great Western Railways and Salt Lake City Airport, and in government with the U.S. Senate, The Pentagon Force Protection Agency, The California Department of Justice and the United States Coastguard, that’s just to name a few.”

In total, BlackBerry managed to grow its customer wins from 90 to 560 in a span of one quarter. These wins are enabling the Software & Services segment grow in importance. As the chart above shows, Software & Services has become the most valuable segment for BlackBerry in terms of revenue contribution. This contribution will continue to grow as the company expects positive growth for the Software & Services segment and negative growth for the Mobility Solutions and SAF businesses.


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