Company / division: BlackBerry
BlackBerry and Delphi today announced a partnership which will see the latter use the former’s QNX operating system as a secure foundation for its autonomous driving system. What’s not clear from either the press release the companies issued or the CNBC report linked below is what operating system Delphi’s platform has been built on until this point, because it’s not brand new and the company has been talking about releasing it to car manufacturers in 2019. At any rate, as far as I can tell QNX will join Intel and its Mobileye subsidiary as partners around the system, which focuses mostly on pulling in sensor data and making sense of it, rather than complete control of the car. QNX is already a widely used operating system within the car industry and BlackBerry has spent a lot of time hardening it and demonstrating its ultra-secure credentials since its acquisition several years ago, something that’s likely to become increasingly important as cars become more and more like connected computers. Investors clearly see the partnership as a boon for BlackBerry, whose shares rose quite a bit after hours today, but Delphi is only one of a number of manufacturers building similar systems for smaller car manufacturers, while larger automakers will likely mostly build their own. Further competition in this space will come from companies like Waymo, who will develop their own sensor and sensor fusion technology to go with their autonomous driving software and therefore offer something more like a complete package in time.
BlackBerry’s QNX division already makes the operating systems that power many cars today, and it’s just announced a new version of its OS for cars titled QNX Hypervisor 2.0. The key selling point of the new version is that it better partitions the safety-critical and non-safety-critical elements of the OS and the services they support in order to both prevent localized glitches from crippling the whole car and also insulate safety-critical functions from hacks that penetrate, say, the infotainment system. The implication of both of those, of course, is that there could be glitches or hacks that would penetrate certain systems, which seems a realistic if not a heartening concession. But as Android and other operating systems make their way into cars, being able to separate functions relating to driving tasks from those that merely deal with infotainment and other elements of the in-car experience is going to be increasingly important, and BlackBerry/QNX is emphasizing that element. I also wonder if it means QNX will be more able to operate as part of a hybrid operating system environment within cars, where infotainment features might be powered by the new version of Android for center consoles while driving features are still powered by QNX.
I think this headline from the Verge captures my sentiments on this phone pretty well. I have covered BlackBerry as a company pretty closely in the past, and still do to some extent, and whenever I write about them or post charts on Twitter, the first response I almost always get is “I though they went out of business”. The reality is that BlackBerry has dropped so far out of the public consciousness in what were once their biggest markets that a phone like this at this point isn’t really going to get them anywhere. The moment for this phone was years ago, not today, and at this price ($549) it’s not an option for the markets where the BlackBerry brand still means something to consumers, like Indonesia. So many of even those who once insisted on a physical keyboard have now caved to the inevitability of the full touch screen, and the vast majority of those won’t go back now they’ve discovered apps, content stores, and everything else modern smartphones have to offer and BlackBerry devices have never really been able to. At least now the risk is mostly on TCL’s books rather than BlackBerry’s, and the reality is that the hardware business at BlackBerry is so small now (under $100 million in the November 2016 quarter) that this is almost all upside for the company – if TCL doesn’t sell any, that’s more or less a continuation of the tiny hardware revenue BlackBerry has been booking, and if it sells a few hundred thousand, that’s useful additional revenue. But this is very likely to be a tiny overall revenue opportunity for both companies, and I’m curious to see how long TCL sticks with the partnership.
BlackBerry QNX Launches its Most Advanced and Secure Embedded Software Platform for Autonomous Drive and Connected Cars – BlackBerry (Jan 4, 2017)
BlackBerry’s QNX is one of the leading in-car operating systems, acquired by BlackBerry from Harman some years ago. In the context of the demise of BlackBerry’s hardware business, this is one of several software businesses that forms the core of what the company will be going forward. It seems to be moving fast in providing support for some of the new things carmakers are doing, including autonomous driving, and QNX is definitely one of several big tech names to watch in the car tech space.