Can RIM shift its carrier fees to other industries?
So maybe this is a dumb question, but im bored at work and having just read Chris's article on the Scotia Bank report, i started thinking about possible scenarios/solutions for their carrier fee conundrum.
So the situation is this.....Rim currently charges carriers a fee (5-10 dollars, ya?) per BB device sold/activated. That fee is for the use of their NOC which does all the push notifications and data compression we love about BB. With BB10 however the NOC is no longer part of the equation. BIS doesn't seem to be in the picture anymore (im still a little hazy on the role of BIS with BB10. I dont believe it was ever explicitly stated how it'll change), and carriers don't want to pay Rim those $5-$10 per device. This is a problem since Rim generates a billion dollars in revenue each quarter from those fees.
But what if those fees could be transferred from carriers to other industries like automotive or medical? If Rim's big play is to garner a foothold in the mobile computing sector, and they've highlighted how BB10 can be utilized in the automotive and medical industries, why can't these carrier fee's be shifted to those industries instead?
For example, if a car manufacturer opts to use BB10 (or some version of it) in their next generation car, so it has real time updates and monitoring, can't Rim then charge that car manufacturer for use of its NOC to push these updates through? The same applies for medical equipment. If a hospital decides to update thier equipment so it's using BB10 to communicate in real time with other machines/hospitals/doctors/whatever, why can't Rim charge that hospital a flat fee to compress or encrypt that information and push it out to the rest of the hospitals infrastructure? Of course you'd only have one car per household instead of 5 devices/household, but the fee itself could be considerably higher to offset that loss of volume.
Now i realize there are issues with compatibility of the NOC with BB10 which is why it's not being utilized in smartphones, but Im sure Rim could build a similar infrastructure that's compatible with qnx and which serves the same purpose. I dont really want to debate the technical nuances that currently prevent something like this (if that is indeed the case, im not a tech guy so i dont know). Im more interested in discussing if the idea of shifting their revenue source from carriers to other industries is feasable, and if so what avenues can they utilize?
PS: If my premise is faulty and something is technologically impossible to do, do let me know. But if it is possible, but just hasn't been implemented so far, mention that too. Im just working based on the information i've gathered while browsing CB. My technical knowledge of the inner workings of Rim's system are mediocre at best.
- 11-26-2012, 04:49 PM #2
BIS and the fee are not going to go away. There will still be BIS and BES services and the NOC most certainly will still be in the picture.
As for "other industries" im not sure but RIM is surely looking to get QNX into various industries like autos where they are already.~Matt
Nexus 5, Z10 LE, White Lumia 521, 32GB Nook HD+ & 16GB PB, 32 GB Dell Venue 8 Pro
As for other industries, ya. That's the point i was trying to make. Even if the carrier fees disappear, all these other vertical markets that Rim keeps talking about can offset that loss, and even overtake it. Rim could essentially apply the same business model to multiple industries and collect service revenue from each one. I suppose the real question i want to ask is, how technologically feasible is it?
- 11-27-2012, 10:38 AM #4
Re: Can RIM shift its carrier fees to other industries?
RIM has already said that BB10 devices will require a service plan. There was a post on their developers blog pointing out the differences between the Dev Alpha A and B. One of the things the article said was that a data plan was not needed for the Dev Alpha units during beta testing, but that release devices will need the service plan.RuneCryption - Unique memory game for PlayBook & BB10, now "Built for BlackBerry".
- 11-27-2012, 12:50 PM #6
I am definitely curious like the most it seems on how BIS will work with BlackBerry 10 to keep RIM's service revenue of $1bn every quarter going. The Dec 20th call might shed some light about service revenues to see if they have already started dropping.Regards,
Playbook 16G 126.96.36.1996
Playbook 64G 188.8.131.526
- CrackBerry Master
11-27-2012, 02:25 PM #7
- 1,415 Posts
I see plenty of opportunity for RIM to do just that.
When I look at regional healthcare models, specialization is not uniform geographically speaking. Connecting QNX enabled machines could make sense for a physician to operate a clinic that is able to connect to a distant center of excellence. The clinic and a remote specialist would be able to securely address a patients medical needs without a long trip away from home. Medical is a high privacy industry that the NOC can service but I'm not sure a dedicated plan is needed or if the use of BB devices is enough I would imaging the size of the clinic would determine this.
Building automation might be a possibility as there is cost pressure; a NOC connection might enable remote management in more cost effective areas or remote management in remote areas. Could lead to wider usage and a greener planet.
Vehicles? would make a lot of sense to offer services there and looks like this will happen soon.
Kiosks - yup kiosks with NFC and POS - would enable cashless payment and realtime inventory and maybe security. This is where a combination of biometrics would allow you to rent a car at an airport or at a city car share program.
Call me krazy but it is possible and it depends on the cost of the service and equipment. The ideas aren't new and interconnecting machines to the network isn't new but if RIM can come in with cost reductions then I see no problem. So yes if they can reduce cost or increase revenue this should be possible. The cost for BIS a month is only $5 for a lot of data I don't see that as a barrier.
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