What's really wrong with BlackBerry

http://mobileopportunity.blogspot.com/2010/10/whats-really-wrong-with-blackberry-and.html

by macrael • 16 years ago

248 74 16 years ago

mobileopportunity.blogspot.com

Isamu3• 16 years ago

Very insightful analysis. At the very least read the section "How a computing platform dies" - this is the first I've seen that perspective. I wouldn't mind reading more about this.

bretpiatt• 16 years ago

Agreed, this quote from it is a good way to summarize, "The symptoms to watch closely are small declines in two metrics: the rate of growth of sales, and gross profit per unit sold (gross margins)".

A good book that elaborates on these is "Every Business is a Growth Business". Unless you are a lifestyle business with a well defended niche reaching a plateau is dangerous.

Isamu3• 16 years ago

Thanks for the pointer - the book is on order.

joe_the_user• 16 years ago

Well it is quite interesting.

Is the distinction between "late-adopter" and "mainstream" specific to the author or well known?

If "late-adopters" are a less-than-desirable target audience, what about aiming at the "mainstream"?

Someone2• 16 years ago

That "you're actually consuming the late adopters", You'll gulp through the late adopters, made me think of a different problem, that of fishing the oceans empty.

nextparadigms2• 16 years ago

You could've gotten the same insights if you read (and understood) 2 books: Innovator's Dilemma and Chasm Companion. They are extremely insightful books about why companies succeed (and fail) and I felt that most of his assumptions came from the theories in those books, because I've been saying those things for over a year to a friend that works at RIM, but she never believed me because RIM "is doing so well financially".

Legion2• 16 years ago

>> "Yes, Android is doing well, but neither RIM nor Apple is giving away its operating system, so it was close to inevitable that Android would eventually get the unit lead"

How is that any kind of rebuttal? How does saying that it was inevitable Android would eat up a bunch of market share hand-wave away the fact that it was really bad for RIM's situation that it happened?

>> "Yes, RIM's not good at sexy marketing, but it has always been that way."

Again with the rebuttals that don't actually make a point that helps RIM's case. The fact that RIM has always been poor at marketing doesn't somehow make it OK. Especially since now, as pointed out above, Android is eating up share. RIM's inability to market is becoming more of a liability. Saying "gee, it's always been that way" does not legitimately hand-wave the issue away.

Saying that the criticisms against RIM are "superficial and petty" and offering those kinds of nonsense counterarguments against them drove me up the wall.

deepu_2562• 16 years ago

I guess he is pointing out that - Although Andriod is gaining market share, it isn't exactly eating into potential RIM market share. Other way to put it is that both RIM and Android target different set of customers.

P.S :- I am not making the above assertion. Just writing what i understood from reading that article.

MichaelMace2• 16 years ago

Sorry for the confusion. What I was trying to say was that I think neither the rise of Android nor bad marketing are likely to be the death of RIM. They may well be damaging, but in my opinion they are a sideshow compared to the central problems.

Android is obviously an important competitor to everybody else in the mobile market, but in my opinion the market is heavily segmented, so it's possible for several companies to grow simultaneously.

And RIM's products sold well for years despite the company's lame marketing. Yes, Apple has raised the bar on smartphone marketing, but if (as BusinessWeek implied) you have to out-market Apple in order to succeed in smartphones, everyone else ought to pack up and quit now.

richardw2• 16 years ago

» How is that any kind of rebuttal?

A free competitor in the software world can have more users, but that doesn't necessarily mean your business is failing. Similarly, Apple has had many fewer users than Windows for a long time but it's doing just fine compared to most Windows hardware vendors.

Other phone vendors have moved from Windows Mobile & Symbian to Android, partly due to the free O.S. The customer profile of Symbian or Windows Mobile customers is likely not that of RIM customers, so it doesn't necessarily drive RIM's failure (although it could certainly increase the odds). He's looking for the problem that will mean RIM's failure.

The sexy marketing issue is similar. If RIM has survived okay up until now without it, good marketing might not cause the business to fail. It will certainly add to the danger, but the issue is again discovering the likely primary cause of failure.

That cause seems to be saturation of RIM's main customer segment(s) and an inability to grow outside of those segments. (Obviously, bad marketing and free alternatives are possible root causes of the latter!)

Please don't be driven up the wall - it's just an opinion :)

Legion2• 16 years ago

>> "A free competitor in the software world can have more users, but that doesn't necessarily mean your business is failing."

But this isn't like free end user software. An Android phone isn't "free" to the end user. People are paying money for Android phones, instead of spending that money to buy BlackBerries. The fact that the OS is free to the manufacturer providing the phones is of no consequence. What is of consequence is that there's this new player in the smartphone market that is gobbling up marketshare that used to belong in part to RIM. I don't see how saying, "oh, that was going to happen anyway" makes the argument any less stinging.

gbhn• 16 years ago

I found the claim that RIM's market is saturating to be suspicious. What was smartphone penetration in the US three years ago? It is only about a third even today, after huge growth. In many parts of the world growth in the last three years has been even more explosive.

ikono• 16 years ago

In my opinion, RIM's problem is that they feel like they defined what it was to be a smartphone. Now that they are no longer king of the hill, they are trying to replicate the current definition of a smart phone. Like the author alluded to, what they should be doing is re-defining a new space for themselves. RIM's never going to make the best iPhone. They need to go back to making the best Blackberry, whatever that is.

sgns• 16 years ago

I agree with this, and think RIM sort of 'won' the smartphone throne without understanding good enough why.

One can see that they don't understand themselves by what appears to me as an attempt to out-Apple Apple, or as you say, trying to make the best iPhone -- a very silly proposition if one understands how deeply Apple's way of operating is embedded in its culture. The same thing, crucially, is going on with marketing. At least it would seem the PlayBook is aimed at business -- one right, if probably inevitable, choice for them.

They need to figure out what made them able to make the BlackBerry a success and then use the same craft to develop their game further. You can't grow wings overnight if you're a fish. My BB-toting friend is always speaking of the BB's intuitiveness and speed for what he does. Is touchscreen really a good choice for that? It seems silly that RIM would squander their assets for something new without first being totally sure that their new 'thing' is better.

In fact, in that matter I think Nokia might be doing slightly better with their transition Symbian-Symbian touch-Meego (anyone with an educated opinion on that one?).

timtadh• 16 years ago

"Yes, Android is doing well, but neither RIM nor Apple is giving away its operating system, so it was close to inevitable that Android would eventually get the unit lead."

If that is true, why doesn't the Linux desktop have the unit lead? I mean its free, installable on everything, and easily obtainable. This kinda of reasoning simply does not hold. There a loads of reasons why Android is doing well, but I don't think that being free is necessarily one of them.

[Edit: I should note that other than that one line, I thought his analysis was excellent.]

semanticist• 16 years ago

I think what has helped Android's uptake is that it's freely alterable without having to ask someone's permission.

Networks and handset manufacturers can use Android as a base and push whatever features they like without having an Apple or RIM complaining.

A major part of making it freely alterable is that the manufacturer/network can make it locked down to the end-user, even if Google doesn't mind people having root on their handset the networks hate it and the networks are the handset manufacturer's customers, not end-users.

I think that's why most comparisons to the desktop PC market break down for me: Dell and Apple's PC/Mac customers are almost always the end-user of their device (corporate sales excepted), so the driving force behind what goes into those products is very different. The network is the one paying the handset manufacturer, so phones are designed to meet the needs of the network.

Apple and RIM have done some good work to try and change this by taking ownership of the relationship with the end-user and reducing the network to a mere carrier of data. Android is pretty much the exact opposite: by being free it becomes 'free to suit the networks' and 'free to make it match network branding'.

That's not to say that Android is bad or otherwise technically lesser than BB or iOS, but I'm pretty certain that it's free availability was a huge factor in the uptake from multiple manufacturers.

mattparcher• 16 years ago

Windows vs. Mac is now Android vs. iPhone. Microsoft slacked off, and lost its place to the equally-ambitious Google. Desktop Linux never had a Google to push its adoption.

blocke• 16 years ago

Yep. Though I think Linux can wipe the tears from its eyes. It can be consoled by the fact its kernel and much of its userspace will be in everything without a Microsoft or Apple logo on it for years to come.

ericflo• 16 years ago

Google Chrome OS

ergo98• 16 years ago

The "Android is free" bit is remarkably foolhardy, so it is surprising that it appears in so many articles.

I've heard that Microsoft charges somewhere in the range of $10 / unit for Windows Mobile, generally for an image that you quite literally set some flags and you have your gold copy (at least pre Windows Mobile 7, as my experience was with the CE variants). For Android the individual handset makers take on tremendous responsibility, not to mention that they often - for reasons of differentiation - decide to apply a generous layer of spakle on top. That doesn't come for free.

Android isn't and has never been free.

Someone2• 16 years ago

It think is even more true than you indicate. http://source.android.com/faqs.html says:

Devices that are properly compatible can seek approval to use the Android trademark.

...

Android Market is only licensed to handset manufacturers shipping devices.

...

The Google apps for Android, such as YouTube, Google Maps and Navigation, Gmail, and so on are Google properties that are not part of Android, and are licensed separately.

I cannot find proof of it, but I would guess neither of these are free.

nextparadigms2• 16 years ago

The main reason why Android is winning is because they were the first quality (iOS like) multi-manufacturer OS that was pushed by a big company that most people love and got a lot of momentum. I don't think being free or open-source was the main reason Android is succeed. It definitely plays a huge role, but even if Google charged a $10 license like Microsoft is doing now with WP7, Android would've still succeeded.

In this case it's actually WP7 that is more like Linux - opportunity wise - because WP7 is the one coming into the market after Android is well entrenched.

philwelch2• 16 years ago

Being free is a big reason, in the same way that cheap OEM licenses are Windows' way of having the biggest market share. Free's not the killer, being cheap enough to be widely available is. Even if Macs or iPhones are the better product, Windows and Android both have nearly every hardware maker in the market selling it (and, in Android's case, on every network), making it a more convenient and marketable option.

AT&T being a crappy network is analogous to AutoCAD and games only being available on Windows; a way to leverage wide availability into concrete advantages for some segments, despite having a worse product to begin with.

Estragon• 16 years ago

The reason linux has never taken off on the desktop is the lock-in from MS propietary formats. There is no such lock in for mobile devices.

markfenton• 16 years ago

I've no figures to back it up, but my initial thought is that the simple cost of the OS isn't the deciding factor. For a PC people expect the Windows name, to see Windows on it, and for all their Windows software to work. That leaves using Linux as an unseen cost to the supplier. For a phone most people probably don't see an OS (with the probable exception of Apple), and don't have legacy software. They just see a phone they want that does shiny things. Therefore the OS chosen might not have such a hidden cost making the fact that Android is free a bigger advantage.

MichaelMace2• 16 years ago

Windows was already established as the desktop OS standard before Linux became prominent. Windows had a huge base of apps and massive network effects. Saving money on the cost of the OS was not enough of an advantage to make most users switch away from Windows.

Mobile is very different. There is no single established OS standard, and in fact most phone buyers don't even know what the OS is in their phone (I am talking about average users, not the folks who are reading this comment). Cellphone companies will sweat blood in order to cut ten cents out of the parts cost of a phone. Eliminating ten dollars in cost is a huge deal to them.

Add to that the marketing power of the Google brand, and Android looked very attractive to mobile phone manufacturers when compared to Windows Mobile and Symbian, which were the other main choices at the time.

rythie• 16 years ago

Linux hasn't managed to take off because for most people it requires changing virtually every application they use to a different one.

OSX is able to make inroads because several key applications such as Microsoft Office, Adobe's products, iTunes etc. also work on Macs.

Mobile phones didn't really have 3rd party apps (they weren't popular) until they iPhone and people were switching brands pretty often anyway.

alanh3• 16 years ago

The argument that Apple has a much rosier future than RIM cannot possibly be distilled to “Apple has better marketing.” They do… but their phone also don’t make you want to tear your eyes out. (I am not under the impression that our author thinks it’s all marketing, but Business Insider sees it more or less that way.)

sandipc• 16 years ago

I think the section at the end about the author buying his wife a Torch (and his problems with its usability) are a strong indicator of your second point.

alanh3• 16 years ago

Remember how everyone likes to note that Apple is never afraid to obsolete itself? Killing OS 9 to start completely new in OS X… Aggressively and constantly re-imagining the iPod… Replacing the iPod (effectively) with a completely new touch-based system (iOS)… beginning the revolution from PCs to iPad-style devices (they are selling as many iPads as they are computers, now).

When has Blackberry ever really dared to cannibalize itself?

wallflower• 16 years ago

> Killing OS 9 to start completely new in OS X

WWDC 2002: Steve Jobs presides over the funeral for 'The Death of Mac OS 9'

http://www.youtube.com/watch?v=Cl7xQ8i3fc0

deepu_2562• 16 years ago

Cannibalization is not the norm. There are many successful platforms which didn't go the route of cannibalization. Ex - windows.

The OS 9 - OS 10 example is more of an exception than the norm. In the case of OS 9 everyone(even Apple people) knew it sucked big time. They tried hard for several years to fix it's problems or try to develop a new one. There was no way for them to continue with OS 9.

RIM isn't exactly is in such a bad situation. Agreed that they need to woo developers much much more to their platform but that doesn't warrant cannibalization. They should continue innovating but should be more evolutionary.

The bad thing is that for a long time RIM sat on it's laurels without much innovation. Good thing is that they still haven't lost the market share. They already moved from their strong place of qwerty keyboards to touch screens. Much more innovation is needed. Not just copying others but having a vision of the future and then aggressively executing on that vision. They did it once before which made Blackberry such a cracking brand. Now they should do it again.

alanh3• 16 years ago

Eh, even Windows could be argued to have followed this pattern, with Windows NT. Different foundation. They did end up supporting the 9.x APIs on the NT platform, to create Windows XP, but the fact is they still released a “competing” version of Windows first.

pwpwp• 16 years ago

Why do you glorify doing something new and stupid, when doing good things well is what people really should be admiring. — Linus Torvalds

Andys2• 16 years ago

Ironic, given my perception of Linux as doing good things in a mediocre way...

revorad• 16 years ago

Because doing something new and stupid often leads to great things?

gnufreex2• 16 years ago

About Apple killing classic MacOS, it was really kill or be killed. They did it years too late, IMHO.

philwelch2• 16 years ago

They had been trying continuously since the late 1980's.

http://en.wikipedia.org/wiki/Taligent

http://en.wikipedia.org/wiki/Copland_(operating_system)

http://en.wikipedia.org/wiki/Rhapsody_(operating_system)

dshanley• 16 years ago

They haven't, but they are currently in the process of trying to reinvent their OS - with QNX. Except, they are launching this OS, but leaving all their Java devs behind. The OS launches on the Playbook with only C++ and Flash support if you can believe it. I don't expect them to have significant market share in two years from now.

martythemaniak• 16 years ago

For some reason RIM gets little but hate around this place (maybe because it doesn't make products for hackers and it competes with Apple), but I think their story is actually quite inspiring.

Mike Lizaridis quit engineering school a early to found RIM in 1984 in a tech backwater. He struggled for a decade, but slowly built up the company over a decade to around 100 people. They then hit a rough patch and had a tough round of layoffs, but survived. 15 years after they were founded, they hit upon both a brilliant idea and execution. When the BlackBerry was released in 1999, RIM had around 120 people and sold 25000 of the units. Over the last decade, they have managed to fend off all big tech companies while growing into a global brand a major tech company. Meanwhile, Mike L has funded one of the coolest charities around (Perimeter Institute) and RIM has turned Waterloo into a major tech center.

So, to answer your glib question: many times between 84 and 99, once around 2003 (replacing an old OS) and right now (with the move to QNX and webos-like SDK).

Silhouette• 16 years ago

I think the Torch is going to be RIM's Vista. They released a supposedly premium mobile device that in practice had obvious deficiencies even relative to products that rival brands had already established in the market for some time. When has that ever worked out well?

FWIW, when I was looking into mobile support for a start-up I'm involved with, using Blackberries was the obvious choice: business focus, we all prefer keyboards to touch screens, etc. Unfortunately, after much time looking through RIM's web site trying to figure out which of the various centralised IT systems we're setting up could easily be hooked into Blackberries for mobile access, I had gone nowhere. Their web site is full of buzzword bovine excrement, but it told me little or nothing about what sorts of protocols were supported for e-mail, calendaring, etc. They kept mentioning integration with a couple of big name tools like Exchange Server, which might be helpful for larger and more established businesses that use that kind of tool, but the fact is, we're a start-up on a budget and we don't. We're also a start-up with finite time to consider our options for infrastructure stuff like phones that don't actually make a product we can sell, and RIM's time expired before I had even scratched the surface of knowing what I needed to know.

Stormbringer6• 16 years ago

I was going to disagree with your analogy, but then I realised that that would make the Storm the equivalent of Windows ME, and suddenly the analogy seemed much better :D

In both cases (Torch and Storm), I was keen to get my hands on them, but I could tell within about half a minute with each that they just didn't feel right. There was something deeply wrong with them.

I don't know what RIM's product problems really boil down to, but I would guess that at no point along the way do they have someone with good taste with the genuine authority to tell them to go back to the drawing board.

But I think perhaps it goes even deeper than that. RIM has its own implementation of Java UI controls, and even after all this time they are disturbingly primitive. It is genuinely difficult to make a good looking UI on a Blackberry. (As proof of this assertion, I invite the sceptic to do a quick Google search on centering text in controls on the Blackberry)

mortenjorck2• 16 years ago

The story of the Torch contacts list debacle is just astounding. How on earth could a system ship with redundant, easily-desynchronized versions of the contacts database? To me, that says the architectural problems run deep, and further, that there's no effective user experience apparatus in place to even try to deal with the usability problems that inevitably bubble up from it.

One thing the author doesn't really touch on, though, is the acquisitions that would appear to be directed right at remedying these problems. QNX has already been integrated into the Playbook, and by all appearances it's destined for BlackBerries, where hopefully it will sport things like a non-ludicrous contacts list API. The acquisition earlier this month of Swedish UI design firm TAT shows they understand that need, and could actually be a huge turnaround if TAT is actually given enough latitude within the company.

protomyth2• 16 years ago

I was actually pretty hopeful about RIM on the QNX and TAT acquisitions, but I am worried about the emphasis on AIR on the Playbook. I just don't see anyone reliant on a cross platform environment (more than a framework) as being able to get the most out of the unique features of their system. It also might not be a happy choice for their existing Java developers.

Stormbringer6• 16 years ago

I have a ... friend ... who has been doing Blackberry Java Development, and this ... friend ... was less than impressed by RIM hopping into bed with Adobe.

I think what exacerbated the situation was that when RIM announced the development kit for the new playbook, they led with the AIR kit, with no defined date for when they'll get Java on there. Which is probably good news for Flash developers, but doesn't look good if Java is your tool of choice.

Now, while RIM has brutally chopped the price of a dev licence (down to something ridiculous like $5 or $10), and they are giving away the dev kit, the tools you need (from Adobe) cost (if memory serves) about $8-900.

The good news is, if you happen to know what you're doing, you can take your Flash app and use some free command line tools to go and wrap it up. So you don't _need_ to spend that big chunk of change on Adobe products... you can trade off your own misery for it instead.

It seems a really raw deal for the Java devs, but if RIM can replace their lost Java devs with Flash devs they might consider that a decent trade-off.

VladRussian• 16 years ago

once i saw who were among recent RIM's hires, it immediately gave me the understanding what the environment inside RIM is like.

>it seems to have lost the ability to create great products.

yep, that's natural in such an environment. Pundits can discuss various small details of marketing, product, leadership ... It all just noise. Once the rot has spread through the company ... Everybody who worked in similarly failed companies can recognize the symptoms.

juiceandjuice• 16 years ago

I heard that blackberry has completely separate teams that work on each OS subrelease, meaning that the 4.6 guys don't talk to the 4.7 guys, who didn't talk to the 5.0 guys. Developing anything for the blackberry over more than one OS release is a complete and utter nightmare. Even after that, you have to worry about carrier differences, BES vs. BIS devices, and a ton of other things.

In the App driven world, BB development cycles tend to run 1.5-2x longer than iOS and Android because of the inconsistencies, even for seasoned devs, at least at my last company.

BB will die because nobody will develop for it.

SandB0x• 16 years ago

In the last year I have seen a lot of new BlackBerry users in London. However, the majority of these have been teenagers on the bus using some entry level model, which is available on pay-as-you-go, or with a very cheap contract. I get the impression this was not their first choice of phone, and I think this (anecdotal evidence) matches the author's analysis.

All the older BlackBerry users I know have switched to iPhone/Android, and at most carry their BB as a secondary, mandated work phone. One friend complained that "it's like they took an old desktop pc and just decided to shrink all the icons".

I hope RIM can pull it together but it doesn't sound too healthy.

Stormbringer6• 16 years ago

Apparently RIM has its own replacement for SMS that is dirt cheap, and this is what attracts the (extremely price sensitive) teens.

Not all teens are price sensitive of course, but those who are will get buried by outrageous SMS fees

halo• 16 years ago

SMS is dirt cheap in Europe.

rahoulb• 16 years ago

Blackberries are certainly the phone of choice for teenagers in the UK at the moment. According to my daughter this is entirely because of BBM

AlexMuir• 16 years ago

Just compare the share prices of RIM, Apple, Nokia and HTC (shows as 2498):

http://www.google.com/finance?chdnp=0&chdd=1&chds=1&...

It's clear that HTC and Apple are taking off. Nokia's peak was around 2000, with a second (dead cat bounce) at the end of 2007. RIM's peak was 2008 - and that correlates with my experiences.

Isamu3• 16 years ago

Several years ago I did some development on the BlackBerry platform and was shocked at their api - got the distinct impression they were coasting. I think they only started to get back in the game in response to iPhone and Android. I still get the feeling they wouldn't have updated as much if not for the competition.

rorrr• 16 years ago

RIM is a one trick pony. If they don't innovate like Apple, they will be irrelevant very quickly.

ntownsend• 16 years ago

RIM has extremely talented engineers and developers, but it does not have a culture where engineers can say "We are doing the wrong thing" and have any decision-makers take notice. This is the fundamental problem with RIM. They have completely failed to effectively use the talent they have. If I were another technology company, I would definitely be trying to poach talent from them.

(Disclaimer: I'm a former RIM employee.)

What's really wrong with BlackBerry

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