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How Blackberry's buying of Cylance shows the company is getting serious about cybersecurity

Kate Fazzini
How Blackberry's buying of Cylance shows the company is getting serious about cybersecurity

Blackberry 's $1.4 billion deal to acquire cybersecurity company Cylance cements the smartphone pioneer's pivot to an exclusive focus on cybersecurity.

The Canadian company has made several other security acquisitions in recent years, but none as large as the Cylance deal announced on Friday. At over $1 billion, the move is a surprisingly large one, indicating the Blackberry will move further away from its devices, which still underpin a number of the company's existing enterprise security deals.

Blackberry has made a rapid transition from a once-ubiquitous corporate smartphone provider, to a niche hardware player — and has become a nearly pure-play cybersecurity firm in less than five years.

Cylance is a well-established cybersecurity firm that provides antivirus, endpoint protection, original equipment manufacturing (OEM) and supply-chain security products. Cylance has around 100 subscriber-clients within the Fortune 500, and 3,500 enterprise clients, according to the statement from Blackberry. The company also has business in state and federal government agencies. Cylance will remain a separate business unit within Blackberry, according to the company.

In recent years, Blackberry has pulled resources away from its smartphone business, halting in-house manufacturing of the keyboard-and-screen handheld in 2016. It then shifted its focus to enterprise security software, chip-level security products for "endpoints" — including Android and iOS smartphones — and protection for the range of devices that fall into the "internet of things" (IoT). Blackberry has also focused its business on some of the biggest-ticket IoT devices, including connected cars.

The acquisition of Cylance, which has a security consulting business, may also give Blackberry more reach in the area of cybersecurity advisory services. Last year, Blackberry acquired U.K. security consulting firm Encription, in a deal with undisclosed terms.

It's not unusual for a non-security company known for some aspect of cybersecurity to attempt to grow its business in the increasingly lucrative space. However, Blackberry is one of the first companies to make a sharp and complete turn into a software and consulting cybersecurity business from a hardware background.