5 lessons we can learn from the current BlackBerry/RIM saga

According to industry analysts, the future does not look bright for the BlackBerry, which had been king of the smartphone market. Here are five lessons entrepreneurs and start-ups can learn from the on-going BlackBerry/RIM saga.

BlackBerryResearch in Motion (RIM), the maker of the BlackBerry, has been experiencing several challenges over the past several months. Its smartphone market share has eroded considerably, and its foray into the computer tablet market this spring was widely regarded as underwhelming at best, relative to similar products on the market. Further, the company has been promising to transform itself by launching a common platform for all of its devices, but the release is constantly being delayed. In the meantime, its customers, even its bedrock corporate customers, are leaving in droves.

With the release of its third quarter results and outlook about 2 weeks ago, RIM appears to be desperately trying to reassure investors that it is not on the brink of collapse. Sadly, the tech industry is not convinced. While we wait with bated breath as to whether RIM will be able to snatch victory from the jaws of defeat, there are a number of lessons that entrepreneurs and start-up owners can still learn.

1.  Know thyself and your market

The BlackBerry’s strength has always been its security features and its email management capabilities, which made it the system of choice for corporate and enterprise customers. The fact that its handsets became a mass-market consumer product has perhaps overshadowed what the device does best. Moreover, the Blackberry’s strengths are not necessarily considered essential to the average consumer, who is now looking for improved features and functionality – similar to those offered by competing manufacturers. Hence one of the inevitable question that RIM must be grappling with, is whether it is possible to hold on to its mass-market appeal, or is it better scale back and focus its survival strategy around its strengths?

Takeaway: Fully understand your strengths and weaknesses. Figure out your niche markets. To the extent you can, play to your strengths and try to minimise your weaknesses.

2.  Don’t rest on your laurels

From about the mid-2000s, the BlackBerry had become the one of the most coveted phone worldwide. Although from time to time new devices would be released, essentially they were not drastically different from each other. Hence by the time Android came on the scene in 2007—8, but more importantly in that same period, Apple launched the iPhone and its Apps Store, history has shown us that RIM had not begun to reposition itself. It launched some iffy products not taking into account where the market was heading, while its competitors improved their offerings, and in the case of Apple, revolutionised the market right under RIM’s nose. Now, RIM is trying to play catch-up.

Takeaway:  Do not sit in awe of your accomplishments and be complacent. Your competitors are continually working on improving their position in the market. Keep your ear to the ground and try to stay a step ahead, but the very least, try not to fall too far behind.

3.  Timing is everything

Many of RIM’s competitors, such as Apple, have to varying degrees, either established regular cycles to launch their new releases, or at the very least, the industry is aware of launches several months in advance. Such is not always the case with the BlackBerry. RIM was expected to launch its new platform, based on the QNX operating system it acquired in 2010, this year. However, the release was pushed back to early 2012, and in the last week or so, that date was again revised to late 2012. Although various reasons are being given for the delay, the crux of the matter is that RIM is yet to launch an offering that can reverse its loss of market share. Its current situation will increasingly become acute, particularly among its corporate customers, many of which have indicated plans to move away from the BlackBerry within the next year (Source: InfoWorld) .

Takeaway: Deliver when and what you promise. Tech markets are too dynamic and with the level of competition that typically exists, you may not have the luxury of unduly delaying product/service updates or launches.

4.  Consider sharing

Relative to the iPhone and Android platform, there are few mobile applications (apps) designed for the Blackberry, although for now, it still has the largest customer base among the three. Furthermore, the BlackBerry platform has been notoriously difficult to develop apps for, and RIM gave developers little encouragement. However, in recent months that has been changing. RIM has been actively trying to coax developers to create apps for the BlackBerry, and in October the company announced that Android apps could run on the BlackBerry PlayBook and its latest smartphones only. However, is this too little too late?

Takeaway: Emerging business models recognise the input and support of customers and other interests to enhance their own user experiences. Although it is vital to figure out what parts of the business you, as the owner, must control, there is huge gains to be made by sharing and facilitating win-win situations.

5.  Know when to call it a day

Although this point might seem a tad premature in the case of RIM, it is still a lesson that we should all heed. For the last several months, industry experts have been warning about the BlackBerry’s imminent demise – even we, here at ICT Pulse, have highlighted our concerns. The clamour has become so bad that analysts are now discussing RIM’s options to salvage the business and making predictions for 2012. Other companies, such as Amazon, Microsoft and Nokia, have also reportedly given thought to purchasing the beleaguered company.  However, RIM is holding firm and trying to weather the storm…

Takeaway:  While it might be interesting to see how the BlackBerry/RIM saga plays out, for start-ups, it always prudent to continually gauge how viable your business is and will continue to be. When the going gets tough, it is crucial to recognise when you might not have the resources or support to ride out the challenges, so that you are in a better position to manage the fallout.

Image courtesy of technokitten, Flickr.

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3 Comments

  • Very interesting read. RIM definitely has work to do. Even Nokia’s partnership with Microsoft’s strong Windows Phone 7 platform will have hardships ahead of it despite the fact that Nokia is a distribution powerhouse and the Windows Phone 7 platform gets as much praise as the Palm’s WebOS. WebOS failed because it was badly marketed, priced badly and poorly distributed. Following which, it was poorly managed by HP.

    Still, I think that there is more to this than you’ve mentioned which don’t make the takeaways quite so cut-and-dry:

    1. “Know thyself and thy market” -> Blackberry was actually in a very good spot when the iPhone came out in 2007 and remained there until 2009 when Android really started to gain momentum. The fact is that even today most people continue to recognize that Blackberry is the ultimate communicator and if they want to communicate on a manageable data/phone plan then Blackberry is the only way to go. In fact, it’s only recently that business executives are considering shifting away from Blackberry as an enterprise phone. These shifts are not only because Apple “revolutionized the market” but because the popularity of the iPhone continues to spread and so too does the popularity of Android. Still, it’s only a matter of time until companies realize that using the Blackberry is much less expensive than paying for data plans for various data-hungry iPhones/Androids. Forget the fact that their IT departments will need to figure out which of the enterprise management systems they should use to replace BES and struggle through the pains of adapting to its differences and constraints.

    2. “Don’t rest on your laurels” –> It’s also important to note that the iPhone is actually not changing very much from year to year and many are speculating that the iPhone 5 HAS to be a radical change because right now, the Android devices are looking way better if you want something that stands out. Apple’s iPhone is currently the de facto for simplicity and “just working” but it’s still limited as a status symbol now.

    4. “Consider sharing” –> It’s difficult to understand why most people forget that RIM released Webworks as a means of creating native apps using only html, css and javascript. This has been out for years and RIM opensourced the technology while continuing to improve it. This changed app development for Blackberry drastically but in this consumer-led market, few people are actually taking note of it and developers are following the buzz because frankly, investors feel a lot more confident investing in your business when you say it’s an iPhone/Android app than if you say it’s a Blackberry app. Of course, this is not to say that the BB Java development platform has gotten any better. In fact, it hasn’t and their API is even more convoluted. The main problem was and continues to be that the Blackberry support forums are lacking severely in activity and the online documentation is also lacking. This is likely due to the fact that RIM has been encouraging developers to join the paid versions of their Alliance memberships and hence, ignore the cries of those developers too cheap to pay.
    However, ALOT of that changed in 2010-2011 when RIM removed almost every pay barrier to developing apps on Blackberry. There is no more fee for getting RIM signature keys and there is no more fee for submitting apps (you still need to pay to submit apps for iPhone/Android). Also, developers no longer need to sign-up on RIM’s website in order to download their tools. RIM has finally started to understand that they need to remove these barriers so developers can get started making the apps.
    This doesn’t mean that the lack of apps situation will change soon. Just when developers were warming up to their calls of “developers make more money with Blackberry”, they announced that BBX will not only not run their java apps but will also be delayed until late 2012.

    5. “Knowing when to call it a day” –> I think RIM made a huge mistake with the Playbook. It simply never should have been made. They should’ve focused on delivering the new OS as a Phone OS and not as a tablet OS. That confused users and placed the thoughts in everyone’s mind that RIM was just like everyone else who wanted to make an iPad alternative. The fact that the Playbook failed to sell wasn’t the only mistake either. RIM also promised all developers that they’d receive a free Playbook if they made a Playbook app however it was less of a promise and more of a challenge because the tools which were made available for creating said apps were HORRIBLE and led to developers openly complaining and boycotting further investments of their time and effort in Blackberry apps. Only a few Playbook apps were made and only because of the combined collaborative efforts of the community as well as some late action by RIM to provide some tutorials and tips…by which time, most developers were turned off already and were heading towards the highly active communities for iPhone/Android development.

    • Sajclarke, absolutely fabulous views! Thanks for taking the time…

      Based on the points you have raised, it really highlights the fact that RIM has really lost its way… I have some additional thoughts, based on your comments:

      1. “Know thyself and thy market” -> Another point to consider, re the growing shift to non-BB devices is the fact that businesses seem to be moving away from fully purchasing employee handsets. Some sort of cost sharing arrangement is becoming more the norm, hence the phone must also cater to the personal needs of employees. People want to do more on their handsets than just send emails; they want to take advantage of the wealth of services/apps that are now available (but not for the BB).

      2. “Don’t rest on your laurels” -> I am not sure the iPhone will every become the mass consumer device like the BB. Its marketing and sales are tightly controlled – iPhones are still not supported in many Caribbean countries. Similar to the Mac, I have doubts that the iPhone will ever be ubiquitous. Perhaps that privilege will be enjoyed by an Android device – Samsung, perhaps?

      4. “Consider sharing” -> I am quite concerned that RIM is continually changing its OS. Phones launched in October 2011 will not be supported when BBX is released next year (if it is released?). I don’t think that stance encourages people to upgrade their devices, however, I gather that RIM has been aggressively promoting the new phones, especially in the Caribbean and Latin America (See one of our earlier articles, Can BlackBerry hold on to its market share in the Caribbean?).

      Further, since apps developed now will not work on the new platform, I would expect this to be quite demoralising to developers, especially since programming for the BB is still quite involved.

      5. “Knowing when to call it a day” -> Your thoughts underscore that fact that RIM wants to be all things to all people, and not necessarily play to its strengths. Re the PlayBook, it really did not take tablet computing “to the next level”, and perhaps really showed RIM as just a follower and not an innovation leader.

      Question: Do you think RIM can reverse its fortunes? Either way, what do you think it should do (to manage the situation)?

  • It’s hard to say what they should do. I can only assume and make best-guesses.

    A few things though:
    1. RIM needs to keep a lookout for the Nokia/Microsoft partnership even more so than the Android movement. Android’s growth is fueled by the whim of the customer….something no one can control forever however Nokia/Microsoft will be aiming at destroying even more of RIM’s current hold on the enterprise mobile market since that has always been Microsoft’s strength. RIM took the market away from Windows Mobile and you can be sure that Microsoft wants it back before the iPhone grabs that too.

    2. Apple isn’t only strong because of their business management and a great phone device. They also make it simple for customers to purchase media to use on those devices and make it simple for developers to make money (though they also change their taxes on developers a lot). RIM started making a positive move with their Social Music initiative and I believe that they should continue to build on the features provided by BBM. It’s great that developers can now integrate their apps with BBM and also great that RIM is pushing even more that media can be shared via BBM. If RIM can manage to leverage that social network that is BBM….then they have a winner. Everyone already trusts it and is happy to use it. They only need to be educated on how they can use it in ways that benefit them beyond communications and also in ways that RIM can open up new streams of revenue for itself and developers.

    3. RIM isn’t changing their OS as much as you make it seem. Blackberry OS 7 was a bit of a divergent path but it kept to the usual story of backwards compatibility though some aspects were broken. Webworks is a great initiative that must continue. Fortunately, RIM recently acquired the guys behind Ripple and the best thing they can do is not hold those guys back especially since it’s an opensource project now. Now that RIM has decided to shed Java due to their own concerns of it limiting the performance and developer-friendliness of BBX, then they need to double-down and either get it released WAY faster ie surprise everyone by holding an event and setting it up for sale within a month after said event (at latest by 2nd quarter) or do a similar promotion like they did for Playbook AND release GOOD and USEABLE development tools. They don’t need another PR disaster like Playbook which quite frankly was a great device eventhough it had crippling flaws.

    Ultimately, as much as I like Android & am interested in Windows Phone, I think we consumers need RIM since their willingness to work with the carriers to provide affordable data packages is the reason why so many flocked to Blackberrys in the first place. Additionally, outside of Apple, they are the only persons who are working on the entire development (software and hardware) of their devices and are therefore best suited to innovate with a clear vision.

    If RIM gets desperate then I’d suggest they work on a cheap Android-powered Blackberry Pearl but only if it’s used to drive third-world adoption and threshold testing of a BBM market or some sort.

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