Executive infighting reportedly led to BlackBerry's downfall

In the end, BlackBerry's leadership may have been its own worst enemy.

The struggling handset maker suffered from infighting at its executive level that hobbled its ability to compete in the mobile market and led to its eventual downfall, according to an investigation conducted by the The Globe and Mail newspaper.

The company, which plans to cut roughly 40 percent of its staff and sell itself to an investment group, announced Friday that it lost $965 million last year. The biggest reason for the dramatic loss was the $934 million write-down the company took on inventory of the BlackBerry Z10, which apparently did not sell well.

The Z10 was a departure from the company's famous keyboard-equipped mobile phone and BlackBerry CEO Thorsten Heins' best weapon to compete with the glass touch-screen handsets sold by Apple and Samsung. While the Z10 was designed to showcase the next-generation BlackBerry 10 operating system, it had one major detractor, according to sources interviewed by the newspaper: company co-founder Michael Lazardis.

During a meeting last year with the company's board to review plans to launch the new device, a frustrated Lazardis voiced concerns that the company's new direction was an abandonment of his vision that made BlackBerry handsets popular with corporate customers.

"I get this," Lazardis said, pointing to one of the company's signature devices. "It's clearly differentiated." Then he pointed to a touch-screen phone. "I don't get this."

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Once the preferred handset maker among the corporate elite, BlackBerry was hurt by its inability to move past the legacy operating system that got it into the smartphone game and quickly fell behind Apple's iPhone and Google's Android operating system. After hitting a high of nearly $145 in 2008, the company's stock lost a staggering 94 percent of its value. On Monday the company announced that it had entered into a deal to sell itself a consortium led by Fairfax Financial Holdings that valued the company at $4.7 billion.

Months before the boardroom confrontation between Heins and Lazardis, the pair was in another showdown, this time with Jim Balsillie, who was co-CEO of BlackBerry when it was still known as Research In Motion. Balsillie championed a strategy to license the company's BlackBerry Messenger (BBM) instant messaging platform to competitors.

Getting BBM onto millions of non-BlackBerry handsets was expected to generate a handsome profit for the company, but the plan ran into stiff opposition from senior executives. Not long afterbeing appointed chief executive of RIM last year, Heins decided to ditch plans to license BBM -- with Lazardis' support, according to the newspaper.

As a result, Balsillie resigned from the board and severed his ties to the company, he confirmed to the newspaper.

"My reason for leaving the RIM board in March, 2012, was due to the company's decision to cancel the BBM cross-platform strategy," Balsillie said in a brief statement to The Globe and Mail.

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See a speed test between every iPhone model ever made

Logic and Moore's Law would seem to dictate that the newly released iPhone 5S should blow the original iPhone from seven years ago out of the water when it comes to which runs the fastest.

But as the video below illustrates with an eight-way speed test between all of the publicly released iPhone models since 2007, the truth is a little more nuanced.

Earlier-generation models, led by the iPhone 3GS and followed by the 3G, 3, and original iPhone turned out to be the quickest to shut down. As EverythingApplePro observes in the video, it seems that something in iOS 7 leads devices running it to take longer to shut down.

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Another surprise comes when all eight models race to boot up. Predictably, the meatier hardware in the four newest models allows them to reach a home screen first, but interestingly, the original iPhone is quicker to boot than the iPhone 4, 3GS, and 3G. All the models shown have the latest updates, so it makes sense that the iPhone 4 might struggle to run iOS 7 quickly. Apparently differences in the earlier version of iOS run on the original iPhone make up for its hardware deficiencies when compared with its successors.

The conclusion reached in the video is that it's not worth upgrading to the iPhone 5S for its marginal speed improvement over the 5 alone. But to me it seems the real issue revealed (or reinforced) here is that you might want to think twice before upgrading to iOS 7 on your iPhone 4.

Did anything in this test surprise you? Let us know in the comments.

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Samsung's ChatOn IM service hits 100M users

ChatOn, Samsung's mobile messaging platform, doubled the size of its user base in the past four months, now tallying more than 100 million registered users.

Preinstalled on Samsung's feature phones and smartphones running both Android and the company's own Bada mobile OS, the cross-platform client is also available as a free download for other mobile platforms, including Apple's iOS and RIM's BlackBerry.

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While available in 237 different countries and 63 languages, ChatOn has experienced steady growth in India, China, and the US and is growing in popularity in Europe and the Middle East, Samsung said in a statement Sunday.

Launched in October 2011, ChatOn is part of a market of multi-platform IM tools that have moved into the realm of social networking. One of the bigger players in the sector is WhatsApp, a 4-year-old platform that has garnered more than 300 million users in more than 250 countries.

It may face increased competition from BlackBerry's Messenger service as well. Once an exclusive to BlackBerry users, the struggling handset maker's BBM service was recently made available to Android and iOS users.

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Take A KitKat Break, Win A Nexus Tablet

If you have been pushing off your tablet purchase till you land a good deal, then you might as well try your luck with a Kitkat chocolate. The search giant, in a bit to popularise its new OS upgrade, and its Nexus 7 tablet has tied up with Nestle to give away 1000 tablets. The contest flagged off on 27th September, will be on for 47 days more (15th November), so if you don’t win any there will be some (stale) Diwali offers as a backup. The site has already listedtentative winners – all you have to do is pick up KitKat 2F, 4F, or Dark chocolate packs, which sport the Android logo on it. Send the eight digit code to the designated number (as listed on the site here), and then pray that you win.

For those not in the know, the Nexus 7 ships with a 7" IPS display (1280x800 pixels at 216 ppi) protected by scratch-resistant Corning glass, a 1.2 MP front-facing camera, 1 GB of RAM, NVIDIA Tegra 3 quad-core processor, 4325 mAh battery and internal storage of 16 /32 GB. That said, it ships with Android 4.1 (Jelly Bean) out of the box, but it would be criminal not to ship it with Android 4.4.

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LG's Flagship Phone G2 Arrives In India

Korean manufacturer LG has brought its latest flagship, the G2 to India. So what's so special about this phone, you ask? Well, for starters, you get a 5.2” full-HD IPS screen. It is powered by a quad-core Snapdragon 800 chipset clocked at 2.2 GHz. It's the exact same processor as found in Sony's Xperia Z1. Like most top-end Android handsets, the G2 features a 13 megapixel autofocus camera. According to LG, this smartphone offers superior low-light imaging with the help of OIS (Optical Image Stabilisation). The most interesting part, of course, is the rear button that doubles up as power key, volume rocker, QuickMemo, and camera key. So, does the rear button makes your life any easier? You'll soon find out soon through our hands-on article, so stay-tuned for that.

The G2 ships with a highly-customised version of Android 4.2.2 (Jelly Bean). The company has added improvements such as QuickRemote (IR remote), Slide Aside (swipe-based multitasking), and Guest Mode (something like Microsoft's Kid's Corner). Other features include 4G connectivity, 16 \ 32 Gb internal storage, and 3000 mAh non-user replaceable battery.

The LG G2 is available in White and Black, and prices start at Rs 41,500. In this price segment, it competes with the likes of the Sony Xperia Z1 that packs in the same chipset and a supposedly better 20 megapixel camera.

Specifications:

• 5.2" HD-IPS screen with 1080x1920 pixels.
• Corning Gorilla Glass 2 protection.
• 16 \ 32 GB internal storage, Lacks microSD card slot.
• Qualcomm Snapdragon 800 chipset.
• 2.26 GHz quad-core CPU, Adreno 330 GPU, 2 GB RAM.
• Wi-Fi, 4G, Bluetooth 4.0, NFC, A-GPS, FM radio, Infrared port, Micro-USB 2.0 (with OTG support).
• 13 megapixel autofocus camera with LED flash.
• Features Optical Image Stabilization.
• 2.1 megapixel front-facing camera.
• Accelerometer, gyro, proximity, compass.
• Available colours: Black, White.
• 3000 mAh Li-Polymer battery.
• Android 4.2.2 (Jelly Bean).

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Apple's iPhone 5S in-store pickup said to resume next week

Shortly after the iPhone 5S launched, customers had the option to reserve one through Apple's Web store or its store app, and pick it up later at one of the company's retail stores. But after just a day, Apple yanked away the option.

That option is set to return next week though, says 9to5Mac. The iPhone maker plans to bring the option back as early as Monday, citing two sources familiar with Apple's plans.

CNET has contacted Apple about whether that's the case, and will update this post when we know more.

Stock of the iPhone 5S has been scarce since the smartphone launched last week. The gold color option was particularly coveted, with back-order dates falling to October less than half an hour after sales began. All models are now listed as shipping in October at Apple's online store, while Apple's retail stores and carrier partners have gotten sporadic shipments since launch.

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iPhone 5S gets quad-core graphics, analysis shows

The 64-bit iPhone 5S boasts a quad-core graphics processing unit -- a first for an iPhone.

Semiconductor analysis company Chipworks has supplied the best evidence yet of the layout of the A7 processor in Apple's iPhone 5S, showing a quad-core GPU. (See image above.)

The A6 chip in the iPhone 5 had a three-core GPU.

While core counts aren't necessarily the deciding factor in making a chip fast, there is a trend toward adding more cores to boost performance. Samsung and Qualcomm, for instance, have had quad-core graphics for a while now. As have Apple's higher-performance A5X and A6X chips that are used in the iPad 3 and iPad 4.

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And getting quad-core graphics into a phone undoubtedly helps games like Infinity Blade 3 run faster.

Now we come to the central processing unit, or CPU. In this case, Apple is bucking a trend. The Chipworks layout confirms earlier reports that the A7 has a dual-core CPU.

Quad-core CPUs are increasingly common now, if not standard.

That said, the proof is in the pudding: Apple's A7 has impressive benchmarks.

"The quad-core card was kind of forced," Anand Shimpi of Anandtech told CNET last week. "It's definitely not the only way to arrive at the ideal performance-power for a phone."

The iPhone 5S is anything but slow.

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What Evernote has learned from Apple

You might think Phil Libin is a little crazy. Several months ago, the CEO of Evernote was sitting down with a pack of Post-Its, slowly peeling away one piece of paper at a time from the gradually shrinking stack, repetitively. He was in awe, studying the adhesive on each brightly colored note. "You should try it. There are millions beads of glue on the back of each of them," he told me.

I suppose you could call what Libin was doing due diligence. On Monday in San Francisco, Evernote officially announced a partnership between itself and 3M, the company that makes the venerable stickies. The two companies are releasing software that digitally categorizes Post-its on Evernote when a user snaps a picture of the notes with a smartphone.

But what this really tells us about Libin is that he's a stickler for detail. "There were decades of work that went into the feeling of peeling them off," he said.

The anecdote also illustrates the company's increasing emphasis on design. What started out as a Spartan notepad app that looked like a tired email client is now lush and layered. And offshoot products like the sketching and annotation app Skitch and the handwriting appPenultimate push forward Evernote's design focus. The five-year-old company, which boasts 75 million users, won this year's Apple Design Award in June.

Libin said design became a central focus for the company about two years ago, but that he had an "epiphany" after seeing iOS 7, the completely overhauled version of Apple's mobile operating system, which got rid of many of the textured surfaces that mimic real world objects in favor offlat, minimalistic surfaces.

"A lot of people took that to mean: nobody needs nice, textured surfaces anymore. But what iOS 7 is saying is that your app doesn't have to have fake textured surfaces," Libin said. "Your digital stuff doesn't have to pretend that it's made out of leather or felt or wood, but that doesn't mean you shouldn't have good experiences with actual physical objects. The two should just work together seamlessly."

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After hearing that, some of the other announcements the company made on Monday seem less out of left field. In addition to the Post-it software, Evernote introduced a bevy of branded physical products, to be sold on a brand new online store called theEvernote Marketplace. They include: a fine-point stylus called Evernote Jot Script, made in partnership with Adonit; a smart scanner that culls relevant information from the Web when docs are scanned; and high-end bags made by French boutique Cote&Ciel. "That's right. We're a fashion brand now. No one saw that coming," Libin said on stage, laughing. The company also tapped Jeff Zwerner, a former creative director at Apple, as the company's vice president of branded products and experiences.

But Libin said the new products are anything but superficial. "None of this is shwag. It's not like we just slapped our logo on it. Each one is designed to solve a specific problem," he said. For example, one bag is triangle shaped and doesn't fall over when you put your laptop in there, and is meant for commuters on crowded trains.

He also thinks the experience is good for employees. He notes that the same engineers working on the Mac app are the ones who helped develop the Evernote scanner.

"It's not just how it looks, but how it works," he said, echoing, maybe subconsciously, what Steve Jobs used to often say.

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BlackBerry Z10 Now Available For Rs 30,000

The BlackBerry Z10 had a lot of things going for it — a sharp 4.2" AMOLED screen, fluid gesture based UI, elegant design, and a great on-screen keyboard. However, we couldn't wholeheartedly recommend it in our review, owing to its exuberant price tag of Rs 43,000. As the saying goes "Better late than never", the Canadian phone-maker has slashed its flagship touchscreen phone's pricing by around 15k. Yes, the Z10 now costs around Rs 30,000. According to the company, it's a limited time offer for festive season. However, we doubt that the price will shoot up again.

The Z10 had been BlackBerry's first handset to run BB 10 OS. The phone doesn’t sport any physical navigation key on the front. The interface is completely based on touch and gesture inputs. It's also the first BB phone to be powered by a dual-core Snapdragon S4 chipset clocked at 1.5 GHz. Other key features include an 8 megapixel auto focus camera, Wi-Fi, Bluetooth, GPS, HDMI-port, 2 GB of RAM, 16 GB internal storage, and microSD card slot, and 1800 mAh battery. If you’re planning to buy it, don’t forget to read our review.

Detailed Specs:

• 4.2" IPS screen with 768x1280 pixels.
• 1.5 GHz dual-core Snapdragon S4 chipset.
• 2 GB of RAM.
• Micro-SIM, 3.5 mm jack, HDMI-port, Micro-USB port.
• Internal 16 GB storage, MicroSD card slot.
• Wi-Fi, Bluetooth 4.0, NFC, GPS, lacks radio.
• 8 megapixel autofocus rear camera, 2 mp front-facing camera.
• BlackBerry 10 OS.
• Accelerometer, gyro, proximity, compass.
• 1800 mAh battery.

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Unbreakable Smartphones Come Closer To Reality

Melbourne: Unbreakable rubber-like Smartphones, rollable tablets and functional clothing have come closer to reality, thanks to new breakthrough research by scientists including one of Indian-origin.

Researchers from Royal Melbourne Institute of Technology (RMIT) RMIT University have developed a new method to transfer electronics with versatile functionality, which are usually made on rigid silicon, onto a flexible surface.

The ability of micro and nano-electronic devices to sense, insulate or generate energy is controlled by thin, transparent nanolayers of oxide materials, often much thinner than 1/100th of a human hair.

These oxide materials are brittle and their high processing temperatures - often in excess of 300 degrees Celsius - have until now prevented their incorporation in flexible electronic devices.

Lead author, Philipp Gutruf, said the new process could unleash the potential of fully functional flexible electronics, while providing a new way for the materials to mesh together.

"We have discovered a micro-tectonic effect, where microscale plates of oxide materials slide over each other, like geological plates, to relieve stress and retain electrical conductivity," he said.

"The novel method we have developed overcomes the challenges of incorporating oxide materials in bendable electronic devices, paving the way for bendable consumer electronics and other exciting applications," said Gutruf.

Supervisor and co-leader of the research group, Dr Madhu Bhaskaran, said the new approach used two popular materials - transparent conductive indium tin oxide and rubber-like silicone which is also biocompatible.

"The ability to combine any functional oxide with this biocompatible material creates the potential for biomedical devices to monitor or stimulate nerve cells and organs. This is in addition to the immediate potential for consumer electronics applications in flexible displays, solar cells, and energy harvesters," said Bhaskaran.

The study was published in the journal Asia Materials.

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BlackBerry shares sink on bid doubts, T-Mobile stops stocking its phones

In an announcement that highlighted the faded relevance of the company that pioneered on-the-go email, T-Mobile US Inc(TMUS.N) said it was no longer efficient to keep BlackBerry devices in its stores.

T-Mobile, the fourth largest U.S. wireless provider, will still ship BlackBerrys to customers who want them, most of them business users, said David Carey, executive vice president for corporate services.

The announcement from T-Mobile, which competes aggressively on price and is better known for consumers than for business customers, followed BlackBerry's news that it is pulling back from the consumer market, where it has bled market share to Apple Inc's(AAPL.O) iPhone and devices using Google Inc's(GOOG.O) Android software.

BlackBerry, which put itself on the block in August, on Monday accepted a tentative $9 a share offer from a mostly Canadian consortium led by domestic insurer Fairfax Financial Holdings Ltd(FFH.TO), BlackBerry's biggest shareholder with a 10 percent stake.

BlackBerry says its second-quarter results will feature slumping sales, a big operating loss and hefty job cuts. It reports results on Friday, but canceled plans for a conference call with investors because of the Fairfax bid.

BlackBerry's Nasdaq-listed shares ended the day at $8.01, almost a dollar below the Fairfax group's offer price.

They rose slightly in after-market trade after Fairfax Chief Executive Prem Watsa, a savvy investor often described as Canada's answer to Warren Buffett, said he was confident the proposed deal would go ahead.

"It has landed on hard times but we think it will flourish over time in a private setting, as a private company where there is no speculation as to what happens every quarter or every six months and the management team can focus on building it over the long term," Watsa told Reuters in an interview.

Watsa declined to name any of the other potential investors. Fairfax does not plan to contribute more than its existing stake in BlackBerry and has left itself the option of withdrawing the bid after reviewing BlackBerry's books and operation.

"I don't think people see it as a real bid," said Eric Jackson of hedge fund Ironfire Capital, who closed a small position in BlackBerry after its June earnings report. "It wasn't a firm offer and Prem can walk away from the deal at any time with no penalty."

FINDING THE FUNDS

Watsa is personally seeking more than $1 billion from several leading Canadian and U.S. pension and private-equity funds to support the $4.7 billion bid, the Globe and Mail said on Wednesday, citing unnamed people familiar with the talks.

"Prem Watsa has to come up with other interested parties and to me it's a pretty unappetizing deal," said Barry Schwartz, portfolio manager at Baskin Financial Services in Toronto, which does not own BlackBerry shares. "It would be more appetizing if Prem was putting up more of his own cash to make the deal."

But rating agency Fitch warned that a further concentration of Fairfax's capital in BlackBerry could have a negative impact on its rating of the insurer. Moody's says the bid is credit negative for Fairfax because moving its public stake into a private deal reduces liquidity.

The Globe and Mail said Watsa was pitching the acquisition as a leveraged buyout that would be financed with more than $3 billion in bank loans, $1 billion in equity from institutions and Fairfax's BlackBerry stake.

If it cannot raise enough equity to help finance the bid, the Globe said Fairfax intends to arrange a short-term bridge loan that could be repaid with BlackBerry's cash holdings of about $2.6 billion.

Watsa declined to comment on how the group plans to finance its bid, or which funds might take part, except to say it was Canadian-led and did not currently include "strategic investors" that are active in BlackBerry's field of business.

Bernstein analyst Pierre Ferragu said he doubted financial sponsors would be comfortable with $3 billion of debt, given the only collateral BlackBerry could offer is its patent portfolio, which he valued between $800 million and $1.5 billion.

"We believe the Fairfax initiative is unlikely to come to fruition and see the next valuation floor for the stock at $5," he wrote in a note to clients.

In the U.S. market AT&T Inc (T.N), No. 2 U.S mobile operator said it is still selling BlackBerrys out of its stores and Verizon Wireless(VZ.N), the biggest U.S. mobile operator, says it will provide its customers with what they want. Sprint(S.N) was not immediately available to comment.

BlackBerry's woes will hurt suppliers. Contract electronic manufacturer Jabil Circuit(JBL.N), which counts BlackBerry as its second largest customer, said it is very likely it will part ways with the company, which could take between 28 and 34 cents out of its 2014 earnings per share.

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Nokia Lumia 1020 Lands In India

The much-hyped Nokia Lumia 1020 has finally arrived in India. The 41 megapixel camera phone is based on the Windows Phone 8 GDR2 (Amber) platform. Unlike the 808 PureView (the company's first 41 megapixel camera), the Lumia 1020 is perfectly pocketable. This phone is based on Lumia 920's polycarbonate unibody design, and is 10.4 mm at its thickest point.

The handsets sport a 4.5" AMOLED screen with pixel dimensions 768x1280. The display is protected by a 2.5D curved Gorilla Glass 3. Thanks to ClearBlack tech, the screen is said to offer relatively better sunlight legibility. And yes, it's a super-sensitive screen, which means you can use it even with gloves on. The phone has been powered by a 1.5 GHz dual-core Snapdragon CPU, and has 2 GB RAM. You get internal storage of 32 GB, but there's no microSD card slot.

Its USP is a 41 megapixel BSI (Backside illuminated) sensor with a 6-lens assembly, manufactured by Zeiss. There's also a Xenon flash, which is generally found in cameras. The phone can record 1080p at 30 fps with stereo sound. For this Windows Phone 8 device, Nokia has specially designed the Pro Camera app that gives total control over parameters such as shutter speed, exposure, white balance, and ISO. The phone comes with a feature called dual-capture. When enabled, it takes a 38 megapixel and 5 mp oversampled picture simultaneously. The high-resolution image can be used for editing, while the 5 mp one can be quickly shared over social networks.

The Nokia Lumia 1020, will start selling from 11th October, and till then Nokia has declined to comment on its pricing. The company cited the fluctuating dollar rates as the reason behind the move, but hinted at a $800 pricing in the US, which is just shy of the Rs 50K. Additionally, you can buy the Camera Grip accessory for about Rs 7,500, while the wireless charger cover will set you back by Rs 3,200. The Camera Grip offers a two-stage camera button, tripod compatibility, and 1020 mAh battery pack. In India, the Lumia 1020 will be available in Black, White, and Yellow. For more details, check out our hands-on article.

Detailed Specifications:

• 4.5" AMOLED screen with Clearblack tech (768x1280 pixels), pixel density: 334 ppi.
• Display features: PureMotion HD+ (Refresh rate 60 Hz), Curved Corning Gorilla Glass 3, Sunlight readability enhancements.
• Touch screen technology: Super-sensitive touch.
• Main camera sensor: 41 megapixel auto-focus.
• Camera resolution: 7712x5360 pixels.
• Camera features: Optical Image stabilization, PureView, Backside-illuminated image sensor, 6-lens optics.
• Sensor size: 1/1.5 inch, f-number/aperture: f/2.2, Camera focal length: 26 mm.
• Flash type: Xenon flash, Flash operating range: 4.0 m.
• 3.5 mm audio connector, Micro-USB 2.0 port, Bluetooth 3.0 Wi-Fi, GPS.
• Battery capacity: 2000 mAh, Wireless charging: Yes, with accessory cover.
• Chipset: 1.5 GHz Dual-core Qualcomm Snapdragon S4, 2 GB of RAM.
• 32 GB internal storage, Lacks micrSD card slot.
• Sensors: Ambient light sensor, Accelerometer, Barometer, Gyroscope, Proximity sensor, Magnetometer.
• Platform: Windows Phone 8.

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Intex Unveils Two New Aquas — The HD And i4

Intex seems to have quite a few Aqua handsets in its kitty, and the brand keeps showering us with them at regular intervals. This time around, the company has brought out two Android-based handsets — the Aqua HD and Aqua i4.

The Aqua HD with a 4.7" screen, (which should aid one-hand usage) the Jelly Bean based handset boasts of a Full aluminium body and a, "metal frame with piano lacquer back cover and aluminum alloy keys". It borrows features for the Samsung GALAXY S4, such as the Lookaway feature (to pause videos when you glance away), and My Screen (multitasking). Priced at Rs 15,900, the handset ships with free accessories worth Rs 5500 including a flip cover, screen guard, 5 GB space on Intex Cloud, and a limited edition pen and key chain set personally signed by Farhan Akhtar (Gasp!!).

Specifications:

• 4.7" HD IPS display with OGS.
• Full aluminium body.
• Dual-SIM (GSM+WCDMA).
• Android 4.2 (Jelly Bean)
• 1.2 GHz quad-core processor
• 1 GB RAM.
• 4 GB internal storage,
• 3G, A-GPS, Bluetooth v4.0, Wi-Fi.
• Proximity sensor, Gravity Sensor and Smart Light Sensor.
• 13 MP rear camera with LED flash and auto-focus; 5 MP front camera.
• 1800 mAh battery, with claimed talk time of 6 hours.
• Bundled apps: NQ Mobile Security, Gmail, Locate, Maps, Messenger, My Screens, Intex Zone, Navigation, News and Weather, Opera Mini, GTalk.

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By going private, BlackBerry may buy time to fix itself

Private or public, BlackBerry's problems remain the same: slumping market share, mostly uninspiring devices and cut-throat competition threatening the state-of-the-art security of the BlackBerry network.

"It potentially buys the company time, analyst James Cordwell of Atlantic Equities in London said of Monday's proposal from Fairfax Financial Holdings FFO.TO. "What it doesn't solve is, what's the long-term strategy for Blackberry."

BlackBerry virtually created a lucrative professional market for email devices, but rivals have muscled in and Apple Inc's(AAPL.O) iPhone has set a new gold standard for consumers.

On Friday BlackBerry warned of slumping sales and a big operating loss, and on Monday it said it had accepted a $4.7 billion offer from a consortium led by Fairfax Chief Executive Prem Watsa.

BlackBerry accounted for just 2.8 percent of worldwide smartphone sales in the first half of 2013, down from 5 percent in 2012, and 11 percent in 2011, according to IT research firm Gartner. The company has lost the "cool" factor that once made it indispensable in Britain and elsewhere.

BlackBerry put itself on the block in August, although the Fairfax bid is the only one on the table so far. BlackBerry has until November 4 to seek better offers, and Fairfax has until then to conduct due diligence and get financing for the plan.

"What they're trying to do is take it out of the public market, restructure it, sell off the parts, maybe have it focus on being a platform for enterprise," said John Stephenson, senior vice president at First Asset Investment Management. The company owns about 474,000 BlackBerry shares, according to Thomson Reuters data.

"Clearly they're going to have less scrutiny. Less scrutiny means they have time to work on this."

LOWER PROFILE

BlackBerry's new future, sketched out for the first time on Friday, will take the company out of the consumer market dominated by the iPhone and devices using Google Inc's(GOOG.O) Android software. BlackBerry will cut 4,500 jobs, or a third of its workforce, as it hones in on a niche professional crowd.

Without the constant glare of Wall Street's analysts, BlackBerry's new buyers could spend to win back market share or tackle longer-term projects that reshape the company. Or they could carve off attractive pieces such as BlackBerry Messenger to sell to the highest bidder.

But even that instant message service has hit roadblocks. A plan to make it available last weekend for Apple iPhone users and those with devices running Android software has been delayed at least a week.

And the market is already questioning the commitment of the as-yet unnamed members of Watsa's consortium.

"I really want to find out if there's financing lined up. I really want to find out who's in the consortium," said Peter Misek, a technology analyst at Jefferies.

Many in the financial community see Canada's deep-pocketed and influential pension funds as likely participants. The funds offered no clues on whether they will join.

The fact that the offer depends on due diligence and financing adds risk, said Bernstein analyst Pierre Ferragu.

"The due diligence process should provide multiple excuses for Fairfax to lower its final offering and may lead banks to simply pull out from what we believe would be a very risky venture," he wrote in a note to clients.

He suggested that holders of BlackBerry shares sell as soon as possible, while those with short positions should cover their bets as the stock will likely remain under pressure.

MADE-IN-CANADA

Fairfax clearly believes it has structured its deal to avoid the Canadian government reviews that have plagued recent prominent attempts to buy up domestic companies, stressing the Canadian nature of the transaction. <ID:L2N0HK16R>

"Our proposal offers a high level of certainty of regulatory approval," Watsa said in a letter to BlackBerry that dismissed antitrust concerns.

He also expressed confidence that Bank of America Merrill Lynch and BMO Capital Markets could finance the offer.

The Fairfax consortium suffers no penalty if it walks from the deal, while BlackBerry pays a break fee if it chooses another offer.

Regardless of whether the deal goes ahead, BlackBerry faces a wall of challenges, including declining phone shipments, a diminishing cash pile and a string of quarterly losses.

It has lost its stranglehold on secure email communications, as law firms, companies and governments increasingly allow workers to use other devices.

"We have used Blackberry in the past; however ... in late 2011/early 2012 we took the opportunity to test iPhones and found our users liked them better," said Peter Alexander, chief information officer at the Australian Treasury, noting that the iPhone is available at a lower cost.

"So we have replaced Blackberry with iPhone - the reason is they meet our security requirements and are more user friendly - with a wider selection of applications."

Even the U.S. Pentagon, with its extreme focus on security, has started allowing use of different smartphones. But the Canadian government said on Tuesday it will not abandon the BlackBerry.

"When it is determined that an employee's job function requires a cellular device with e-mail capability, a BlackBerry device is normally assigned," a spokesman said.

BlackBerry had pinned its hopes on a new line of BlackBerry 10 devices, the touchscreen Z10 and Z30, and the Q10, with the mini-keyboard that many users like.

But the new devices need new servers, and some professional customers have been reluctant to switch.

That said, there are a few hopeful signs.

BlackBerry said on Tuesday that 34 of Britain's FTSE 100 major companies are testing or using its new servers which allow BlackBerry to manage its own brand of devices as well as Apple and Android gadgets in the workplace.

(Additional reporting by Cameron French and John Tilak in Toronto, Rob Taylor in Canberra, So Young Kim in New York, David Alexander in Washington and Louise Egan in Ottawa;

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