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John Chen Likes a Bad Hand: Six Timely Insights from BlackBerry’s CEO

John Chen didn't set out to be The Turnaround Guy. He just played to his strengths.

“I like to fix things. I always liked to fix things,” Chen said at the latest RBCDisruptors, our monthly conversation on innovation and how technology is changing the way we work, live and play.

He’s had plenty to fix at BlackBerry, the iconic Canadian tech company he took over as executive chairman and CEO in 2013. One of his first tasks back then was to announce a record $4.4 billion quarterly loss. The company got back in the black after a pivot to software and services, which now drive 90% of its revenue. The numbers are far below the good old days — but they’re climbing.

BlackBerry’s CEO says he’s driven to do what others think isn’t possible. Pulling that off takes a clear head and a sharp understanding of the larger trends around you.

He spoke to our audience about trade tensions between the US and China, the future of mobile devices and how artificial intelligence is changing cybersecurity.

Here are some of his insights:

1. Huawei will have to open up

In the emerging cold war of technology, 5G is the latest battleground. Chen says China’s Huawei will eventually have to surrender its code for examination if it wants to win access to Western markets. “I see no other way for Huawei to get back in the game, without doing that,” he said. The reality is, Huawei isn’t the only supplier of emerging technologies like 5G routers and modems, and Western governments can move on without them. They can turn to other firms like Ericsson.

2. We may have seen peak phone

Chen says Apple got the inflation curve wrong, and the $1,000 phone isn’t going to be the next big thing. There’s not enough innovation to justify the eye-popping prices we’ve seen on new models.

3. Cars are the new smartphones

Vehicles are increasingly technology devices — and they’re going to need secure software to protect them. Chen sees this as BlackBerry’s big opportunity. Its QNX technology is already being used in 120 million cars. Amid concerns about hackers driving cars into ditches and drones into plane engines, BlackBerry’s goal is to make QNX the standard automotive operating system — what Windows is to PCs.

4. The cyber battle is going from defense to offence

If you’re focusing on your most recent hack, you will lose. Security is a cat-and-mouse game that’s top of mind from the armed forces to hospitals to major banks, and both the hackers and defendants are turning to artificial intelligence to get them ahead of the other side. BlackBerry made its offensive play last fall, spending $1.4 billion to acquire Cylance — a cybersecurity company that uses AI to predict future attacks.

5. BlackBerry doesn’t want your data

Going up against giants like Apple and Google means focusing on your strengths. For BlackBerry, that’s security and privacy. It’s the heritage of the company, and its bet for the future. Unlike its competitors, BlackBerry isn’t trying to manage and monetize data. “We don’t take a look at any of the data. We don’t use it, we don’t care about it. We actually have an algorithm to discard it.”

6. Relish your losing hand

Chen’s approach to business borrows from his love for contract bridge. He likes the game because it’s not about having a lucky hand. You get points based on how well you play the hand you’re dealt. “It’s really about, could you do better with what you’ve got.” That’s the challenge that drew him to BlackBerry. It’s a tougher road, but play it well, and it’s a higher payoff.

Smarter technology doesn’t mean we can sit back and let Alexa take the wheel. It means making our own pivot, and ensuring our society is not only tech-dependent but tech-savvy.

Sources

As Senior Vice-President, Office of the CEO, John advises the executive leadership on emerging trends in Canada’s economy, providing insights grounded in his travels across the country and around the world. His work focuses on technological change and innovation, examining how to successfully navigate the new economy so more people can thrive in the age of disruption. Prior to joining RBC, John spent nearly 25 years at the Globe and Mail, where he served as editor-in-chief, editor of Report on Business, and a foreign correspondent in New Delhi, India. He is the author of three books and has a fourth underway.