New Yorker jumps on FUD-wagon: BlackBerry Season

[sosumi11]

Research in Motion and the BlackBerry’s Rise and Fall : The New Yorker

by James Surowiecki
FEBRUARY 13, 2012

Five years ago, Research in Motion, maker of the BlackBerry, was one of the most acclaimed technology companies in the world. The BlackBerry dominated the smartphone market, was a staple of the business world, and had helped make texting a mainstream practice. Terrifically profitable, the phone became a cultural touchstone—in 2006, a Webster’s dictionary made “CrackBerry” its word of the year.

These days, it seems more like the SlackBerry. Thanks to the iPhone and Android devices, R.I.M.’s smartphone market share has plummeted; in the U.S., according to one estimate, it fell from forty-four per cent in 2009 to just ten per cent last year. The BlackBerry’s reputed addictiveness now looks like a myth; a recent study found that only a third of users planned to stick with it the next time they upgraded. R.I.M.’s stock price is down seventy-five per cent in the past year, and two weeks ago the company was forced to bring in a new C.E.O. The Times wondered recently whether the BlackBerry will go the way of technological dodoes like the pager.

The easy explanation for what happened to R.I.M. is that, like so many other companies, it got run over by Apple. But the real problem is that the technology world changed, and R.I.M. didn’t. The BlackBerry was designed for businesses. Its true customers weren’t its users but the people who run corporate information-technology departments. The BlackBerry gave them what they wanted most: reliability and security. It was a closed system, running on its own network. The phone’s settings couldn’t easily be tinkered with by ordinary users. So businesses loved it, and R.I.M.’s assumption was that, once companies embraced the technology, consumers would, too.

This pattern—of winning over business and government markets and then reaching consumers—is a time-honored one. The telegraph was initially taken up mainly by railroads, financial institutions, and big companies. The telephone, though it became popular with consumers relatively quickly, was first used principally as a business tool. The typewriter’s biggest users were offices. The Internet originated in the military-industrial complex, and first found an audience among academics and scientists. The personal computer, though popular with hobbyists early on, came to market dominance only once I.B.M. introduced models targeted squarely at businesses. Historically, new technologies have been very expensive—when phone service was introduced in New York, it cost the equivalent of two thousand dollars a month—and so early adopters have generally been companies that could make (or save) money by using them. (It’s telling that the biggest exception to the business-first pattern was television, where the business applications were less obvious.) In 2006, it looked to R.I.M. as if the story of the smartphone market would echo the story of the telegraph.

It didn’t. In fact, even as the BlackBerry was at the height of its popularity, we were entering the age of what’s inelegantly called the consumerization of I.T., or simply Bring Your Own Device. In this new era, technological diffusion started to flow the other way—from consumers to businesses. Social media went from being an annoying fad to an unavoidable part of the way many businesses work. Tablets, which many initially thought were just underpowered laptops, soon became common among salesmen, hospital staffs, and retailers. So, too, with the iPhone and Androids. They’ve always been targeted at consumers, and tend to come with stuff that I.T. departments hate, like all those extraneous apps. Yet, because employees love them, businesses have adapted (and the iPhone and Androids have upgraded security to make themselves more business-friendly). As a result, the iPhone and Androids now control more than half the corporate mobile market.

Consumerization has been disastrous for R.I.M., because the company has seemed clueless about what consumers want. R.I.M. didn’t bring out a touch-screen phone until long after Apple, and the device that it eventually launched was a pale imitation of the iPhone. Although the BlackBerry brand name was once seen as a revolutionary success, over time R.I.M.’s product line became bewilderingly large, with inscrutable model names. If you’re a consumer, do you want the 8300 or the seemingly identical 8330? And the BlackBerry’s closed system has left R.I.M. ill equipped for a world in which phones and tablets are platforms for the whole app ecosystem.

The consumerization of I.T. has deep economic and social roots and is unlikely to go away. Technological innovation has dramatically lowered the cost of computing, making it possible for large numbers of consumers to own powerful new technologies at reasonably low prices. (Apple’s products seem pricey, but despite the weak economy it has sold more than a hundred million iPhones and more than forty million iPads.) The workplace is changing, too. The barrier between work and home has been eroded, and if people are going to have to be constantly connected they want at least to use their own phones. Companies have quickly come to love consumerization, too: a recent study by the consulting firm Avanade found that executives like the way it keeps workers plugged in all day long. And since workers often end up paying for their own devices, it can also help businesses cut costs. One way or another, consumers are going to have more and more say over what technologies businesses adopt. It’s a brave new world. It’s just not the one that the BlackBerry was built for. ♦

[dkjohn.]

considering feb 13 is 7 days away i would not take the article serious.

[BB10FTW]

I think i have heard this story before .........*thinks to self*............Oh wait I know! ON EVERY NEWS CHANNEL, EVERY BLOG, EVERY ARTICLE FOR THE LAST FEW MONTHS OR LONGER!!!!! Reading articles like this are just annoying, they sound the same as the last like no one has their own opinions and the titles they give are retarded. The Fall of Blackberry!!!! Like what??? I personally don't remember seeing RIM bankruptted or Mike and Jim running away from the RIM buildings with cans of gasoline trying to burn RIM to the ground for the insurance money. No what I see is a company that makes money during a difficult year and during a major transition and do the nah sayers give credit??? Heck No they don't. What really bugs me is that RIM has gotten more bad publicity then Foxxconn has for being as cruel and as horrible as they are. The way people look at RIM is twisted and sick, the things people say that know absolutely nothing are very vulgar and cruel towards the Company We All Love. It's time to rise up and tell these people to get their facts straight and report real news and not the same damn article a billion times because they like to trash a Great company. Long Live Research In Motion and Long Live Blackberry!!!

Sorry for the rant but all this garbage "news" really gets under my skin.
Also what's with the date? I am guessing it's a typo.

[Economist101]

Originally Posted by BB10FTW

It's time to rise up and tell these people to get their facts straight and report real news and not the same damn article a billion times because they are bored.

Which facts aren't "straight"?

Originally Posted by BB10FTW

Also what's with the date? I am guessing it's a typo.

The article is from the issue dated February 13, 2012.

[BB10FTW]

Originally Posted by Economist101

Which facts aren't "straight"?



The article is from the issue dated February 13, 2012.

Well I meant the facts part as a general thing not totally specific to this one article however I do find the part where they talk about the CO-CEO's being forced to be a load of crap. If they were going to leave because of the market pressure they would have done it differently and not just boom it's done and surely they would have not stayed on the board but thats just my opinion.

And thanks for clearing up the date thing, makes sense now

[rkennedy01]

I think the article sounds rather reasonable and even handed. Nobody's questioning whether or not RIM screwed up - rather, it's those who predict the company's inevitable demise that we all take issue with. Could RIM have done a better job responding to the iPhone/Android? Of course. Do their earlier missteps preclude them from making the necessary adjustments and delivering compelling products that will recapture some of their lost market share? I don't believe so.

Just because we still believe in RIM doesn't mean we can't be honest about what they did wrong and how badly they executed against the competition.

RCK

[lotuslanderz]

Wonder if Malcolm Gladwell (a self-admitted PC/BlackBerry guy) will write a "rebuttal"

Actually, this is the perception of RIM and only RIM can change things. Bring out a good product (on time) and people will praise it. If BB10 is all it's, um, cracked up to be, then people will pick it. Look at the PlayBook threads. Many are from new owners and most are positive compared to what we saw in the ... summer... This is because today's PlayBook is much improved even without the OS2 goodies. The discounted prices (great marketing) has also helped sway the perception.

[Thunderbuck]

Originally Posted by rkennedy01

...Just because we still believe in RIM doesn't mean we can't be honest about what they did wrong and how badly they executed against the competition.

RCK

Absolutely. I've said it many times before; I believe there are enormously talented people at RIM in many areas. They need good, decisive management. I think they started getting it in October.

And it's imperative that we recognize where the company has faltered. If they can't learn from their mistakes, there's no way they can bounce back.

[bsmith151]

The consumerization of IT and mobile devices will continue to grow. Gartner estimates that by the end of 2012 20% of companies will eliminate their IT departments in favor of cloud platforms and services, and companies will continue to look for ways to eliminate the costly traditional company paid mobile smartphone devices. Security will become less of an issue with Mobile Device Management and custom apps / software, and as mentioned in the article the "always on" possibilities of squeezing more out of salaried workers in off hours with personal devices linked to company resources will make corporate chieftains giddy.

RIM has made recent management changes and is making moves in product, platform and OS to be part of this changing landscape, and those individuals and programs need to be allowed to prove themselves. But with a loss in enterprise value of 70+% in the last year RIM will continue to be a media target.

[Palmless]

Originally Posted by Economist101

Which facts aren't "straight"?

I made it to the second-from-last paragraph before the story switched from a recitation of inarguable facts, to the introduction of an opinion.

[Economist101]

Originally Posted by Palmless

I made it to the second-from-last paragraph before the story switched from a recitation of inarguable facts, to the introduction of an opinion.

Let's not get caught up in the details. No opinion is allowed in a piece on RIM unless the author acknowledges the inevitable Apple-like comeback that the Thorsten-ator is setting up.

[Thunderbuck]

Originally Posted by Palmless

I made it to the second-from-last paragraph before the story switched from a recitation of inarguable facts, to the introduction of an opinion.

Well, it IS an opinion. It's well-articulated, even well-considered, and I respect the author's right to it.

It does, however, imply an air of inevitability that I do not share.

I do not anticipate an "Apple-like" rise from the ashes, because RIM isn't actually "ashes". It's nowhere near as bad as Apple was in 1997, because their customer base is actually continuing to grow. The problem is that it isn't growing as quickly as it used to. This "consumerization of IT" definitely plays into that, but I believe RIM is addressing this with an improved app infrastructure and some pretty good media opportunities. 7digital is actually a viable alternative to iTunes for music, and I have high hopes for the coming Video Store.

There's also been that nasty execution problem. I think that can be attributed fairly easily to confused management and a consensus decision-making style that left nobody accountable for blown deadlines. Again, I firmly believe that senior management began to address that back in October, because RIM has done a pretty good job of meeting expectations since then. I think Jim's and Mike's departures were decided on at that time, and the transition has been quietly underway since.

This article is fair, and represents an analysis that looks pretty reasonable, but it assumes that RIM has no awareness of what it has to do, and I don't agree with that conclusion.

[Economist101]

Originally Posted by Thunderbuck

I do not anticipate an "Apple-like" rise from the ashes, because RIM isn't actually "ashes". It's nowhere near as bad as Apple was in 1997, because their customer base is actually continuing to grow. The problem is that it isn't growing as quickly as it used to.

Actually, RIM's customer base now is growing faster than almost every point in its history other than 2008-2009. The problem is that they've significantly cut prices to get there, which is why profit isn't where it should be.

Originally Posted by Thunderbuck

This article is fair, and represents an analysis that looks pretty reasonable, but it assumes that RIM has no awareness of what it has to do, and I don't agree with that conclusion.

On the contrary, to outsiders the selection of Thorsten Heins and his initial, post-change statements suggest an absence of awareness of what RIM needs to do. Heins may yet make his critics look foolish, but neither he nor RIM can help the fact that outsiders weren't very impressed.

[sosumi11]

Originally Posted by Thunderbuck

This article is fair, and represents an analysis that looks pretty reasonable, but it assumes that RIM has no awareness of what it has to do, and I don't agree with that conclusion.

The bigger problem is that RIM is in the Tech Industry and Innovation drives the Tech Industry.

RIM has to prove they can innovate again. This does not mean by coming out with a "me too" operating system that runs on "me too" devices. This means they need to come up with an earth shaking product(s) that will indeed change the world.

The BlackBerry changed how we do business.

Now all RIM has to do is change it again.

Why is this so hard?

[Thunderbuck]

Originally Posted by sosumi11

The bigger problem is that RIM is in the Tech Industry and Innovation drives the Tech Industry.

RIM has to prove they can innovate again. This does not mean by coming out with a "me too" operating system that runs on "me too" devices. This means they need to come up with an earth shaking product(s) that will indeed change the world.

The BlackBerry changed how we do business.

Now all RIM has to do is change it again.

Why is this so hard?

You have just nailed the reason why RIM actually has a shot here: I think they already ARE innovating again.

They have been for awhile, but it was hard to see under all the mismanagement. TAT's work on the PlayBook suggests the prospect of a cool but distinctive (and uniquely functional) UI for BB10. The app infrastructure is finally taking shape. The media infrastructure is finally taking shape. I think that RIM seems to have a much broader vision of NFC than anybody else right now.

Add in the prospect of deep integration with QNX stuff in cars and home controls, and I think we're really on to something.