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Pentagon says 'absolutely no new orders have been placed' for BlackBerry phones

Pentagon says 'absolutely no new orders have been placed' for BlackBerry phones


Stock surges on news of a big win that never was

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BlackBerry Q10 hero (1024px)
BlackBerry Q10 hero (1024px)

Last week, a press release from the Department of Defense announced the launch of a new mobile network within the agency that will utilize unclassified mobile devices such as smartphones, tablets, and other consumer-level electronics. According to the DOD, this network will support 100,000 deployed devices by the end of the year. Within the press release announcing the network, the DOD revealed that it already supports quite a few mobile devices, including 80,000 BlackBerry smartphones.

This spurred on a raft of reports this week, with titles such as "The Pentagon Just Saved BlackBerry From Total Oblivion" and "Why the Pentagon just saved BlackBerry." Many of these reports take the assumption that the Department of Defense just purchased 80,000 new smartphones from BlackBerry. The announcement has also been credited with pushing the company's stock up from about $9 per share at the beginning of the week to nearly $11 per share today. (The stock was likely also buoyed by BlackBerry itself talking smack about its competitors in the enterprise space.)

"Absolutely no new orders have been placed for new BlackBerry devices."

But did the Pentagon really purchase 80,000 new BlackBerry smartphones? The answer is no. The agency is merely using phones that it already had in its possession. The specific wording used in the release reads, "The program currently supports 1,800 unclassified mobile devices including iPad 3 and 4, iPhone 4S and 5, Samsung 10.1 tablets and Samsung S3, and Motorola RAZR devices with participation from the combatant commands, services, and agencies throughout DOD. The program also supports 80,000 BlackBerry phones." Nowhere does it say that the DOD just submitted a purchase order for 80,000 new BlackBerry phones, it just says that it currently "supports 80,000 BlackBerry phones." Furthermore, the DOD doesn't specify whether those supported phones are running the new BlackBerry 10 operating system or the older BlackBerry 7 platform. That isn't to say that the Pentagon won't ever purchase more BlackBerry devices in the future, it just didn't do so in this instance.

The Department of Defense confirmed this in a statement provided to The Verge:

Absolutely no new orders have been placed for new BB devices. The DISA press release put out Jan. 16 never alluded to any devices being purchased. The 80,000 BBs and 1,800 non-BB devices referenced in the release are legacy systems already in DoD inventories.

Had the Pentagon actually submitted a purchase order of that magnitude, it's very likely that BlackBerry would have been quick to toot its own horn on the matter. The company has never shied away from bragging about its sales to enterprise customers — it frequently puts out press releases for sales as small as 1,000 units. But no such press release exists from BlackBerry for the Department of Defense announcement.

The government has long been a big customer of BlackBerry — even President Obama carries one and is unable to give it up, even if it is "no fun." For one of the largest governments and militaries in the world, a deployment of 80,000 smartphones doesn't come as a surprise at all. But for the Pentagon to actually be helping BlackBerry's bottom line, it needs to purchase new devices, and that's not what has happened. In fact, the new program's cross-platform support and compatibility is not good news for BlackBerry, which has long been the sole smartphone platform trusted by the government. There may be a lot of BlackBerry smartphones in government agents' hands today, but chances are there won't be forever.

The Pentagon's launch of cross-platform support is anything but good news for BlackBerry

So no, the Pentagon is not saving BlackBerry. Even if the DOD did place an order for new phones, a sale of 80,000 phones doesn't even make a quarter, much less save a company. BlackBerry is going through a lot of transitions, and it has even stated itself that the enterprise market will be where most of its efforts are focused in the future. But to prevent the company from continued shrinking and disappearing, it's going to need a lot more than one customer, even if that customer is Uncle Sam.

Update: The article has been clarified to note that the Pentagon's release does not imply that it will never purchase BlackBerry devices in the future, it just hasn't done so in this instance.