Struggling smartphone manufacturer BlackBerry may be forced to cut more jobs as it continues to lose market share to competitors, the Wall Street Journal claims. The technology company, which once enjoyed a dominant position in the mobile phone market, has seen its market share drop substantially in favour of its competitors.
Citing anonymous sources, the Journal reported that BlackBerry may be reducing its service and sales sectors in an effort to increase profitability and reduce costs. While the company has not confirmed the job cuts, it has commented on its commitment to ‘reducing costs throughout the organization’ and promised to strengthen finances.
BlackBerry’s former dominance of the smartphone market has diminished due to an increase in innovation and advertising spending from rivals such as Samsung, Apple, and HTC. The company was previously a popular option for business customers due to its secure messaging service, but has since lost much of its popularity.
In an effort to increase sales and regain lost market share, the company has invested heavily in innovation. BlackBerry released its latest platform – BlackBerry 10 – early this year to mixed feedback. The company has since admitted that the launch was a ‘disaster’ and that the new operating platform failed to produce measurable returns.
The company, which was formerly known as RiM (Research in Motion) fired 5,000 of its employees in 2012 in an effort to reduce its spending. Despite this, the cost of operating its business increased substantially during the same period as BlackBerry increased its investment in sales staff and administrative systems.
With first-quarter losses of $84 million, BlackBerry has a long path to profitability in the short term. The company’s sales have grown slowly, with just 6.8 million phones shipped during the first quarter of the year, putting the firm behind its competitors in the United States and South Korea.
