BlackBerry is running out of options

blackberry for sale
BlackBerry's board of directors is considering 'strategic alternatives' to save the company. But at this point, BlackBerry is simply running out of viable options.

BlackBerry is simply running out of options to save itself.

The long-delayed Blackberry 10 operating system was meant to be the smartphone maker's savior, but sales have sorely disappointed. That has prevented BlackBerry from resurrecting its once-dominant position in the smartphone market, which has dwindled quickly as Apple, Google and even Microsoft (MSFT) overtook the company.

Given that miserable state of affairs, BlackBerry's board of directors announced Monday that it is considering "strategic alternatives" to boost the company's value and sell more smartphones. The problem: None of those options is necessarily viable.

Sell the company outright. BlackBerry CEO Thorsten Heins has said for months that the company would potentially be open to a sale, but putting a "for sale" sign in the window doesn't guarantee anyone will make an offer.

Not so long ago, Microsoft (MSFT) and Lenovo were frequently floated as likely candidates to make an offer for BlackBerry. But today, BlackBerry's sinking-ship smartphone business would almost definitely rule out a full sale of the company.

In a note to clients Monday, Macquarie Securities analyst Zach Horat declared himself "skeptical that potential strategic buyers ... would assign any value" at all to BlackBerry's (BBRY) hardware business.

Related: Blackberry 10 is not a hit

License the software. If BlackBerry's smartphones themselves are a deal-killer, peeling off the company's software business could help to gain interest from a number of buyers. BlackBerry's brand has lost consumer cachet, but it still holds a strong reputation for corporate security.

In addition to secure email, BlackBerry offers several multi-platform security solutions. Secure Work Space allows iPhone and Android users to toggle between personal and corporate modes, and Mobile Fusion lets corporate IT staffers manage different mobile devices through a single interface.

Even if a full company sale didn't pan out, BlackBerry could decide to become a software-only company, launching corporate-focused apps that work on Apple's (AAPL) iOS and Google's (GOOG) Android devices.

But for now, BlackBerry doesn't appear willing to consider dropping hardware. Just a few weeks ago, on BlackBerry's most recent earnings call, Heins said customers look at the company as "an end-to-end solution, including the device."

Nomura analyst Stuart Jeffrey doubts Heins' attitude has changed.

"It seems that management retains its focus on sustaining its own operating system / platform and is not yet willing to transition to a hardware-free solution," he wrote in a note to clients on Monday.

Go private. Taking the company private could change that. Without those pesky shareholders around, BlackBerry could have the freedom to become a software company.

"We believe that this would be a difficult and painful transition and one that might be best suited to a company that is private rather than publicly listed," Jeffrey wrote. Once completed, however, he said BlackBerry should be able to become a highly profitable business that could make the company an attractive acquisition target.

But going private is expensive business, and it's unclear who would be willing to finance such a massive overhaul of the company.

Horat, the Macquarie analyst, scoffed at the idea, noting BlackBerry would have mentioned a go-private proposal already if it had a viable idea.

Peddle the patents. Another non-hardware bright spot for BlackBerry is its trove of valuable smartphone patents. Its portfolio would give any buyer a massive advantage in the competitive and highly litigious world of smartphones -- just look at the never-ending Apple v. Samsung lawsuits.

But that would be tantamount to giving up. With $3.1 billion in cash on hand and a growing presence in the developing world, BlackBerry just isn't there yet.

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