BlackBerry is planning to cut its workforce by up to 40 percent, equivalent to 5,000 employees by end of 2013. Despite feedback from critics that the Ontario-based company is doing this as one of its cost-cutting measures, the company prefers to call it a "strategic move."
The Wall Street Journal reports on Wednesday the current status of the company. During its glory days back, it used to have a total workforce of around 17,000 employees with a 14 percent market share in the U.S. smartphone industry. Now, it has downsized its employees to 13,000 with a market share of less than three percent.
It used to dominate the U.S smartphone market almost reaching 60 percent until the iPhone emerged. Apple's market share rose to 30 percent in the third quarter of 2008, BlackBerry still had 40 percent market share though it was its first decline since its launch in 2004.
BlackBerry also let go of thousands of employees in 2011 and 2012 in order to reduce its costs. Last year, the workforce cut was up to 5,000 people within nine months.
CEO Thorsten Heins had this to say regarding the downsizing in 2012, "It is necessary to change the scale and refocus the company. I assure you that we wouldn't move forward with a change of this size if we didn't think it was critical for our future."
A BlackBerry spokesperson shared to eWEEK, "We are in the second phase of our transformation plan. Organizational moves will continue to occur to ensure we have the right people in the right roles to drive new opportunities in mobile computing."
This recent employee downsizing is not a cost-cutting move. It is not just about increasing the efficiency of the workforce but also a strategic move to attract buyers.
BlackBerry had confirmed in a statement made on Aug.12 that among its strategic options included "possible joint ventures, strategic partnerships or alliances, a sale of the company or other possible transactions."
