BlackBerry Ltd (NASDAQ:BBRY) has strengthened its security unit with the acquisition of the Britain-based Encription, a cyber security consultancy firm. The objective was to offer its customers industry-leading threat alleviation and cyber security services. The acquisition was part of its CEO John Chen’s efforts to focus on security and privacy issues as he was engaged in spearheading a turnaround for the company. The terms of the agreement were not disclosed by the companies involved.
Big Potential For Tapping
BlackBerry indicated that there was big potential in the cyber security consulting division. The smartphone maker said that the market was currently predicted to be $16.5 billion annually globally. The Canadian firm had to change its focus from making hardware devices to the software segment as its device lost market share and popularity dipped steeply.
There are 40 cyber security professionals working with Encription would be absorbed by BlackBerry. These professionals have also helped test vulnerabilities in the network in respect of both the big corporate entities and government agencies. The acquisition should also enable BlackBerry to cross-sell some of its security products. That should help generate additional revenue to compensate for the weakness in hardware sales numbers.
BlackBerry Ltd corporate development head, James Mackey, termed the acquisition as a natural extension of what it was doing currently. He said that he was excited about the fresh offering that the company would offer its customers, and that it would be complementary to its current offerings. He also said that it was a good addition to its portfolio of security products.
BlackBerry has been involved in acquiring security software companies. For instance, it acquired Good Technology, a rival security firm, for $425 million in September last year. This was preceded by acquisition of privately-held AtHoc. The latest addition to the acquisition list was Encription. Demand for security software has increased in view of growing attacks by cyber criminals.