A Farewell to BlackBerry
The greatest irony of the mobile phone industry is that it's the biggest and fastest growing technology market by volumes—with over 1.2 billion units sold each year—while also being the most volatile. Over a dozen companies exited over a decade. Companies such as Motorola, Ericsson, Siemens, NEC and Alcatel becoming defunct or acquired/merged and others like Nokia and LG imploding in sales. There was a time not so long ago when each of these victims were at the top of their markets in terms of share of value, volume or profit.
For each exit there seems to have been some entrant that stormed ahead and quickly took up share from the floundering incumbent. Apple, Sony, Samsung come to mind but we mustn't forget that HTC rose from being an original design engineering company to a global brand (with 80% share in Windows Mobile phones) and that Palm entered from the PDA market (bringing the idea of apps with it) and of course BlackBerry (then known as Research In Motion) started out as a pager company and re-wrote the rules of the industry through compelling services.
I recall how when in 2003 RIM decided to launch a bona fide phone, a RIM executive said that it was easier for them to add phone capability to a BlackBerry Pager than it would be for a phone maker to add reliable email to their products. And he was right. For the next five years the BlackBerry had a near monopoly on mobile email surviving challenges from Microsoft Windows Mobile devices such as Motorola Q and Samsung Blackjack as well as Nokia E series smartphones. Imagine the shock at Microsoft when a small Canadian upstart was able to maintain a lock on corporate mobile email whose accounts were all running Microsoft Exchange.
BlackBerry was winning because it nailed the job to be done of reliable text-based messaging. It did not win because it had some "control point" in the value chain or cozy relationships with all the world's mobile operators. It was not an "insider" in telecom and even had to fight parasitic patent trolls for years.
The tragedy of RIM however was that this extraordinary competence with email was not leveraged into becoming a more general-purpose computer. The resetting of user expectations brought about by the iPhone (notably coming from a computer maker and not a phone company) meant that consumers were willing to tolerate less-than-great email for the benefit of having great browsing, great apps and great media consumption in a handheld. They even tolerated less-than-great phone call quality and battery life and size which was the traditional basis of competition in the phone market in 2007.
It was the trap of suddenly being more than good enough in your core while not being good enough in a new basis of competition which is at the heart of the Innovator's dilemma that condemned RIM. There is a solution to the Dilemma but RIM did not realize they were in a dilemma quickly enough to implement the solution. By the time they did act it was too late.
As the graph above shows, the decline began one year after the iPhone launched but it was foreseeable much earlier. The question since then has always been about execution. It was about whether management could pull off a recovery. The odds were always against it and this week we saw another shoe fall.
As the company put itself officially for sale, one of the original innovators and most beloved smartphone company has become a victim of the market it created.
I believe there are a few things that could be added to this article. Let's talk about where BB went wrong--it will be interesting to see how many people completely miss this and think I'm commenting on the current state of RIM. Is it "innovative" to see that people want mobile e-mail and fill that need (especially in a space where others were doing the same thing)? Is it "innovative" to then stop and lock out innovators? Is it innovative to respond to consumers and then fail to respond the the needs of businesses? BB didn't create a market. They simply responded to demand. There were other options but none as well-packaged. Consumers wanted e-mail on-the-go and BB nailed it. In my opinion RIM didn't create anything and they were never "ahead of the curve" in anything except meeting a consumer demand for a brief period of time. All RIM did was put together existing technology to address what should have been an easy to identify need. They got to market early, nailed it, and stopped with apathy that would shame the IRS. BB did e-mail amazingly well. That's it. Just e-mail. RIM does deserve kudos for just how well they did implement e-mail. Listen to the consumers that rave--they say they love their BB and it works great for them followed by their main requirement; e-mail. Some people are still stuck with '90s tech (e-mail) but that's quickly fading and while it will not likely drop to zero it will drop like snail mail over time to a minimal threshold. RIM's proprietary and locked-down implementation locked out innovation. Solution providers had to backwards-engineer their applications to interact via e-mail because that's all BB could support. BB is a consumer device. And a lot of consumers are commenting here on consumer needs. Call RIM as a consumer and get an excellent consumer experience. They typical consumer never thinks about the difference between consumer need and enterprise needs. Businesses that make decisions based upon "I love my BB" end up in a position they clearly deserve. BB was not an enterprise solution. . If you personally knew someone high up in the RIM hierarchy . Deployment in enterprise scenarios crippled by proprietary architecture and server (BES) . Call RIM as an enterprise or enterprise-user and find out they just don't care. I was on numerous calls to RIM. They were oriented towards responding to individual consumers. The moment you tell them you have an enterprise requirement their capability to respond dropped to nothing. If you called with an enterprise request (e.g. "I need to replace 5, 10, 100 phones") they would respond to you as if you were an individual consumer. There was no channel for working with corporate customers who purchased in bulk. The standard response was we can ship you one phone and no answer on when subsequent phones would be available. Imagine how someone that loved BB and talked their company into investing in to 1500 devices felt at the end of that call. I worked with businesses that had to throw away thousands (yes, really) because they purchased BB only to later find out BB simply wasn't enterprise-ready at any level. These are the reasons RIM gained and lost standing in the marketplace. Businesses learned their lesson the hard way--any business that ordered BB got what they deserved. RIM filled a need where a great vacuum existed and stopped so hard they stopped everyone else leaving consumers completely in the dark thinking they had a "great" solution (which is very interesting). They basically advertised that anyone with a more flexible solution capable of providing enterprise support could take the market from them, fast. That's what happened. This is why consumers are still in the dark.
Continuous Improvement
11 年I converted to Nokia Win phone, and I love it with Win-8 laptop & the Xbox entertainment system. I was pretty attached to BlackBerry, and secretly hope they sell their e-mail system to MS, but after getting the Lumia and getting the new BB-10 for another family member, it'd be hard to go back.
Senior Project Manager at HCL Technologies
11 年As per my understanding, the term Smartphone has been added in a dictionary post arrival of Blackberry, features like email, BBM etc which has been clearly mentioned in the article are true, however in this competitive environment, where the situation has always been “Innovate or die” [Indeed I read it as comment by fellow reader], Blackberry failed in certain aspects, as the key audience has always been technocrats, business users. Those certain aspects are:- ? Design – Same design curve & bold ? Apps – though they had apps but with the entry of Android in the market, things have moved ahead. Games like “Temple Run” don’t exist for BB user… its true because no matter how occupied you are, you cannot keep on playing Brick Breaker!! & much more Though I have been using my 9700 for sometime, I still wish, Blackberry should come back strongly.
Owner at C. P. P. S
11 年Is it me and my big imagination or does anyone else think that Microsoft will buy BB to try and save its self from the hole their in? BB BB