I personally hold that RIM failed because it ignored it's winning demographic (government, military, enterprise and business users) and attempted to create a device for the broader consumer market.
The Storm was rushed out, as the article says, in part because RIM thought it had to compete where I don't think it had to compete. Now I'm no savvy analyst, but it seems to me like RIM got tricked into picking a fight on Apple's terms and lost terribly.
Would enterprise and business users really be using Blackberries today if only they had stuck with hardware keys forever?
I can't imagine it happening. Enterprise IT isn't isolated from the rest of society (although it sometimes feels that way). When the rest of the world moved on to touchscreens, Blackberry would have been left behind anyway.
No, RIM failed because government, military, enterprise, and business users are also normal consumers when not working. Sure, they had great messaging, but apple and google had decent messaging with web browsers, games, and applications
The reason MS made sure you could Windows at home "for free" is that it would carry to the business world (where the money is).
I find it very hard to remember something that went from business to the home market successfully.
Nobody wants their clunky office app/device to be used at home, what they want is to use their consumer app/device on the office which is usually better and easier to use.
> I find it very hard to remember something that went from business to the home market successfully.
The Personal Computer.
Remember that mainframe you have at work that can crunch right thru spreadsheet numbers? Now you can have that same convenience at home. And this one can play Frogger too.
Not only this, but people became addicted to their phones. Use of one's phone now comes in first place, right ahead of sex, of things people couldn't live without, according to surveys. So people cared deeply about the phones they were using, unlike say when a company issues you a laptop.
This plus Bring Your Own Device enterprise plans. Nobody wants two different phones to carry around.
Enterprise/business is merging with consumer phones.
Their mistake was not getting into the enterprise app market for iOS and Android. They still could since the software sort of sucks still (or maybe my firm is cheap).
RIM didn't pick a fight on Apple's terms or turf; instead, Apple (and Android to a lesser degree) made RIM's turf the fighting ground, and trounced it with comparatively stellar UX.
Although I can't talk about enterprise and business users, I was involved in a project targeted for government that, if released, would have made the Storm look elegant in comparison. The expectations of the government around the time of the biggest iPhone growth was that government contractors need to make hardware the same price as the iPhone, but meeting fairly stringent MIL-STD-810 standards.
Not only are devices aimed for government purchase going to be sold in smaller numbers than consumer devices, they have higher environmental standards (drop it in jet fuel and have it survive, let it sit out in a sandstorm, etc.).
Fewer sales and more requirements means higher costs, not lower, and the government was happy to simply buy five iPhones instead of buying one device that would probably cost 5X the cost of a single iPhone, and still get pretty decent lifetimes out of them.
Yes RIM was right to see that the iPhone was so powerful that it was breaking down all the (up till then) norms around how corporate IT purchased hardware and software vs consumer. But they could have panicked less because they had a big install legacy base to feed off for 2 - 3 years to get a more consumer friendly version right.
It's worth noting that Apple is in the same position today as RIM only 10x or 50x larger but still vulnerable to a brand new device upending their entire company.
By the time the iPhone came out, they were already innovator dilemmaed to death. They could either choose to double down on their existing customers and be slowly nibbled to death or leap across the chasm to mainstream customers and fall into the pit.
The only way they could have survived was if they had started 5 years before and came up with the iPhone themselves, which wasn't going to happen. Faced with two bad paths, the path I would have liked to see them take is to accept defeat and organize the slow windup of the company over the next 20 years, returning as much cash back to the shareholders as possible. But good luck convincing a CEO to ever do that to their career.
I disagree. RIM never realized they were never selling pagers or phones. They were selling business communications. They should have made their software run on devices built by others. They could keep their high-end devices and market them as status symbols.
I'd say RIM was superior in messaging, but lost because they kept the platform closed - and inferior in photos and music, which made them lose as a multi-use device.
Sarcasm tag needed? I think OP makes a good point. If RIM would have cross-platormed BBM sooner, they would of incredibly early to the messaging platform war
Enterprise and business users were increasingly getting used to and demanding iPhones and iPhone-like devices. Apple and Android phones changed the way people used phones and Blackberries went from being the "how cool is it that my work got me this awesome phone that lets me do so much" device to the "ugh, my workplace still forces me to use this crappy device with a tiny screen and a funky physical keyboard" device.
Government/military users of course have long been accustomed to using whatever device wins the RFP, but even there the change in how people use mobile computing devices had to be felt.
I'm not sure a focus on the broader consumer market was the problem. I believe the problem was they tried to do a Blackberry copy of an iPhone instead of a Blackberry for the consumer market.
A low priced Blackberry with a nice keyboard for messaging and a decent camera to go along with the horizontal screen would have staked out an area. Making deals with pay-as-you go groups would have gone into an area Apple didn't go and Blackberry might have dominated. Horizontal screen and camera could be an advantage.
That's just blog spam of the AP piece which itself is pretty short. There's really no new insights here, just "the Storm was rushed, it failed, so we gave up." That's the entire content of the original article, a single short quote.
It's also false. I still have two in a drawer at home. We were getting trade ins on upgrades (after 2+ years of use) of Storms while I worked at Verizon.
I don't know where they came up with that number. I'd believe 100% of users were dissatisfied, but there was obviously not a 100% return rate. That would mean every phone ever sold came back as a return.
I noticed the link to the AP article after I posted and it had been upvoted. But to be honest, the 'blog spam' actually says everything that is interesting in the AP article, in about half the wordcount.
At the store, I thought the clickable screen was "neat" but would probably become annoying after a few days. 100% return rate confirms this. RIM had to know it was going to fail.
Problems were they ignored Apple and at a time in which they themselfs were moving more towards the consumer market with the perl and Bold models, dropping the nice easy to use jog-wheel which still can't be beat for scrolling up and down fast with one hand, imho.
They then got complacent upon the business side and then ended up going in a panic as they used the share price as a indicator and not feedback of how things were going and with that had extra delays in seeing what was wrong.
They also had some nice wifi VOIP features but telco's prevented those from coming live in 2007 and would of helped greatly for business and consumer side at a time in which hotspots and wifi was becoming fruitful.
This alienating of business users and many missed opportunities, for one being rolling there own datacentre box instead of an expensive bolt-on for microsoft Exchange would of opened up other non Exchange based markets more and also given a firmer presence and toe-hold in a company.
Sad part was I was working there upto 2007 and had chatted with a director (late 2006) about the alienating the business market chasing the consumer one and we know how that went. But still pains me how the management were more into being seen to be good than actually being good and with that was two types, those who were technical and those who were not and the latter sadly had more say and less ears.
Then the other big aspect that hit Blackberry would be 3G, on 2G they beat everything with their own data protocol optimised for low-usage and needing telco's to have there own server to handle the custom UDP packets, which upon a device you would find under the books, which was there teminology for protocol handler/translation upon the device.
Now when 3G started the whole pulling emails become more easier, less need for high cost 2G usage, and whilst 3G not as cheap it allowed more saturation very quickly to reduce those costs and mature at a time just right for Apple in many parts as well as others.
Another avenue they had was blackberry connect which would run upon other devices (windows phones, nokia's and the like) which would handle the blackberry custome protocol to allow emails using as little 2G data as possible, this whole area was one they did not invest in and started cutting back at a time when things were about to change. Again more aggressive deals and less arrogance about position in the market would of done huge favours and they could of been the go to email provider of Apple and the World, but they did not.
It is if almost they went thru a phase of picking the bad decisions at the worst time and hd they rolled dice would of had better luck in direction.
Still, to admit failure is good for a CEO, albeit few many years late. But Jim was one of the better ones, managment wise.
>They then got complacent upon the business side and then ended up going in a panic as they used the share price as a indicator and not feedback of how things were going and with that had extra delays in seeing what was wrong.
What does share price as an indicator and not feedback mean?
Means people would tell managment things were wrong and they would ignore it as the share price was doing well. So instead of using metrics to gauge how well they did they were in effect ignoring those and going the share price is alright, have another beer.
In a Dunkin Donuts, I once saw two strangers (strangers to each other) commiserating about the problems they were having with their Blackberry Storms and how much they both hated it and wished they had gotten iPhones. I wish I could say it was a revelation but I feel that the writing was on the wall as soon as the iPhone was announced.
RIM was a super-efficient machine for selling a story to CTOs, and that story required a device for people to carry around. That market is insignificantly small in comparison to the larger market of human beings; when Apple started selling to humans, there was one thing RIM could've done: blow their entire company apart and sell the same service without the handsets, by bringing the features that CTOs wanted from the Blackberry ecosystem to the world of BYOD.
But that amount of change would have been suicidal for a lot of management, and would require changing the entire company on a relative dime. It's hardly surprising that they tried to muddle through and got crushed.
1) They should have embraced a decent appstore and given developers the proper tools to not just build great apps, but also make money (same thing happened to Nokia)
2) Yes, they rushed production of the Storm. They should have NOT tried to make BB OS more iPhone/Android like and focused more on #1
BB hardware, security and power efficiency is where BB is king. I really wish RIM would disappear and merge with Windows Phone. Nokia/BB HW + WinOS/Android would be a killer combination.
I was at this event. It was hosted at the Empire Club of Canada in Toronto and featured the two authors of Losing The Signal: The Spectacular Rise and fall of Blackberry, interview Jim Balsillie. Jim was excellent; gracious, humble, insightful, kind. These were my big takeaways (very loosely quoted):
On hiring:
Q. How did you attract talent to the small city of Waterloo?
Jim: We found kids that were excited to come to the BIG city of Waterloo. Small town Valedictions. I love hiring them. Give them two years to mature and they'll knock your socks off.
On the iPhone début:
Jim: Perhaps overlooked was the significance of having the exclusive deal with ATT. Steve Jobs used to describe the carriers as the "four orifices" - everything had to go through them. This partnership was far more significant than people realized.
On Blackberry:
Q. What phone do you have in your pocket?
Jim: I have a Blackberry, I read my newspaper every morning on a Blackberry Playbook. I love them both, and you'll have to pry them out of my cold dead hands if you want me to change!
A few things I wasn't aware of (from Jim):
- In it's heyday, RIM (Blackberry) was the fastest growing company 5 years in a row.
- There was a patent battle that nearly killed RIM (Blackberry) in it's early days, before they major growth (I would like to read more on this).
I still wonder if their handset business could have survived if they had swallowed their pride and became just another Android vendor.
Their hardware was at the very least competitive with the rest of the market, and I believe they would still have great appeal to the niche of users that prefer physical keyboards today.
BYOD has always been a huge thing but until the iPhone it was hard to justify because many phones simply contained your personal phone numbers and MAYBE email with no good way to keep company stuff separate (Windows Mobile was really the only one that did this...kinda).
When the iPhone came out it showed how more personal a phone could be; of course everyone is going to want to keep their personal assistant with them all the time!
Many seem to think RIM competing in the consumer market was a bad choice but I argue that no matter what direction BlackBerry went after the iPhone's release they had no choice but to compete in the consumer market. Nowadays there are plenty of holdouts but it's getting difficult to find a place where you can't use your personal phone and have your work stuff on it but separated.
no wifi. Simple, very simple, bad business decision, to pander to the carriers.
By simply adding the HW and disabling by default they would have appealed to geeks and devs; instead in 2006 we were importing at top dollars grey market nokia e61s from europe. (canadian dev here)
Because the local carriers were offering a variant of those phones without the wifi here.
Iphone with wifi was the paradigm shift, carriers are still reeling from this one.
If RIM's developer tools now are an indication of what they were like back when Apple released XCode for iOS, I am not surprised how things turned out. I had to do the tiniest of an app as a starting point for someone else recently. Horrible IDE, compile errors in sample code that mysteriously go away if you mash "run" a few times, need to install support components but what exactly isn't defined, documents where you aren't sure right away what version of BlackBerry they are for. And when you find the docs, you find the writer is in love with acronyms. I decided very quickly I would never touch the platform seriously, there is no joy there.
Also, if Objective-C is deemed 'too hard', what is C++ + Qt considered?
It's as if RIM consists of hard core business people and hard core engineers, both wearing blinders while cheering each other on. There are no 'normals' to care about how one feels about developing on the platform, to care about initial experiences, documentation that doesn't frustrate. If it's like this at the developer level, who is there is care about the end user?
If I was a developer on BlackBerry back then, I would have jumped on the iOS opportunity. Today, you can't even pay previous BB developers to work on BB, they have moved on and want to enjoy their work. The few sticking it out know they can charge pretty much whatever rate they want.
A smart phone without apps is a dumb phone.
53 comments
[ 3.1 ms ] story [ 120 ms ] threadThe Storm was rushed out, as the article says, in part because RIM thought it had to compete where I don't think it had to compete. Now I'm no savvy analyst, but it seems to me like RIM got tricked into picking a fight on Apple's terms and lost terribly.
I can't imagine it happening. Enterprise IT isn't isolated from the rest of society (although it sometimes feels that way). When the rest of the world moved on to touchscreens, Blackberry would have been left behind anyway.
The reason MS made sure you could Windows at home "for free" is that it would carry to the business world (where the money is).
I find it very hard to remember something that went from business to the home market successfully.
Nobody wants their clunky office app/device to be used at home, what they want is to use their consumer app/device on the office which is usually better and easier to use.
The Personal Computer.
Remember that mainframe you have at work that can crunch right thru spreadsheet numbers? Now you can have that same convenience at home. And this one can play Frogger too.
Enterprise/business is merging with consumer phones.
Their mistake was not getting into the enterprise app market for iOS and Android. They still could since the software sort of sucks still (or maybe my firm is cheap).
Although I can't talk about enterprise and business users, I was involved in a project targeted for government that, if released, would have made the Storm look elegant in comparison. The expectations of the government around the time of the biggest iPhone growth was that government contractors need to make hardware the same price as the iPhone, but meeting fairly stringent MIL-STD-810 standards.
Not only are devices aimed for government purchase going to be sold in smaller numbers than consumer devices, they have higher environmental standards (drop it in jet fuel and have it survive, let it sit out in a sandstorm, etc.).
Fewer sales and more requirements means higher costs, not lower, and the government was happy to simply buy five iPhones instead of buying one device that would probably cost 5X the cost of a single iPhone, and still get pretty decent lifetimes out of them.
It's worth noting that Apple is in the same position today as RIM only 10x or 50x larger but still vulnerable to a brand new device upending their entire company.
The only way they could have survived was if they had started 5 years before and came up with the iPhone themselves, which wasn't going to happen. Faced with two bad paths, the path I would have liked to see them take is to accept defeat and organize the slow windup of the company over the next 20 years, returning as much cash back to the shareholders as possible. But good luck convincing a CEO to ever do that to their career.
And, obviously, their phones should run Android.
Government/military users of course have long been accustomed to using whatever device wins the RFP, but even there the change in how people use mobile computing devices had to be felt.
A low priced Blackberry with a nice keyboard for messaging and a decent camera to go along with the horizontal screen would have staked out an area. Making deals with pay-as-you go groups would have gone into an area Apple didn't go and Blackberry might have dominated. Horizontal screen and camera could be an advantage.
They tried to build an iPhone not a Blackberry.
http://www.theglobeandmail.com/report-on-business/excerpt-ho...
(it's an excerpt from a book)
I don't know where they came up with that number. I'd believe 100% of users were dissatisfied, but there was obviously not a 100% return rate. That would mean every phone ever sold came back as a return.
The current URL makes you pick your city, etc, first.
http://www.wsj.com/articles/behind-the-rise-and-fall-of-blac...
A link to get around the paywall: https://www.google.com/search?q=The+Inside+Story+of+How+the+...
They then got complacent upon the business side and then ended up going in a panic as they used the share price as a indicator and not feedback of how things were going and with that had extra delays in seeing what was wrong.
They also had some nice wifi VOIP features but telco's prevented those from coming live in 2007 and would of helped greatly for business and consumer side at a time in which hotspots and wifi was becoming fruitful.
This alienating of business users and many missed opportunities, for one being rolling there own datacentre box instead of an expensive bolt-on for microsoft Exchange would of opened up other non Exchange based markets more and also given a firmer presence and toe-hold in a company.
Sad part was I was working there upto 2007 and had chatted with a director (late 2006) about the alienating the business market chasing the consumer one and we know how that went. But still pains me how the management were more into being seen to be good than actually being good and with that was two types, those who were technical and those who were not and the latter sadly had more say and less ears.
Then the other big aspect that hit Blackberry would be 3G, on 2G they beat everything with their own data protocol optimised for low-usage and needing telco's to have there own server to handle the custom UDP packets, which upon a device you would find under the books, which was there teminology for protocol handler/translation upon the device. Now when 3G started the whole pulling emails become more easier, less need for high cost 2G usage, and whilst 3G not as cheap it allowed more saturation very quickly to reduce those costs and mature at a time just right for Apple in many parts as well as others.
Another avenue they had was blackberry connect which would run upon other devices (windows phones, nokia's and the like) which would handle the blackberry custome protocol to allow emails using as little 2G data as possible, this whole area was one they did not invest in and started cutting back at a time when things were about to change. Again more aggressive deals and less arrogance about position in the market would of done huge favours and they could of been the go to email provider of Apple and the World, but they did not.
It is if almost they went thru a phase of picking the bad decisions at the worst time and hd they rolled dice would of had better luck in direction.
Still, to admit failure is good for a CEO, albeit few many years late. But Jim was one of the better ones, managment wise.
What does share price as an indicator and not feedback mean?
But that amount of change would have been suicidal for a lot of management, and would require changing the entire company on a relative dime. It's hardly surprising that they tried to muddle through and got crushed.
1) They should have embraced a decent appstore and given developers the proper tools to not just build great apps, but also make money (same thing happened to Nokia)
2) Yes, they rushed production of the Storm. They should have NOT tried to make BB OS more iPhone/Android like and focused more on #1
BB hardware, security and power efficiency is where BB is king. I really wish RIM would disappear and merge with Windows Phone. Nokia/BB HW + WinOS/Android would be a killer combination.
On hiring: Q. How did you attract talent to the small city of Waterloo? Jim: We found kids that were excited to come to the BIG city of Waterloo. Small town Valedictions. I love hiring them. Give them two years to mature and they'll knock your socks off.
On the iPhone début: Jim: Perhaps overlooked was the significance of having the exclusive deal with ATT. Steve Jobs used to describe the carriers as the "four orifices" - everything had to go through them. This partnership was far more significant than people realized.
On Blackberry: Q. What phone do you have in your pocket? Jim: I have a Blackberry, I read my newspaper every morning on a Blackberry Playbook. I love them both, and you'll have to pry them out of my cold dead hands if you want me to change!
A few things I wasn't aware of (from Jim): - In it's heyday, RIM (Blackberry) was the fastest growing company 5 years in a row. - There was a patent battle that nearly killed RIM (Blackberry) in it's early days, before they major growth (I would like to read more on this).
Great session.
Their hardware was at the very least competitive with the rest of the market, and I believe they would still have great appeal to the niche of users that prefer physical keyboards today.
When the iPhone came out it showed how more personal a phone could be; of course everyone is going to want to keep their personal assistant with them all the time!
Many seem to think RIM competing in the consumer market was a bad choice but I argue that no matter what direction BlackBerry went after the iPhone's release they had no choice but to compete in the consumer market. Nowadays there are plenty of holdouts but it's getting difficult to find a place where you can't use your personal phone and have your work stuff on it but separated.
By simply adding the HW and disabling by default they would have appealed to geeks and devs; instead in 2006 we were importing at top dollars grey market nokia e61s from europe. (canadian dev here)
Because the local carriers were offering a variant of those phones without the wifi here.
Iphone with wifi was the paradigm shift, carriers are still reeling from this one.
It's as if RIM consists of hard core business people and hard core engineers, both wearing blinders while cheering each other on. There are no 'normals' to care about how one feels about developing on the platform, to care about initial experiences, documentation that doesn't frustrate. If it's like this at the developer level, who is there is care about the end user? If I was a developer on BlackBerry back then, I would have jumped on the iOS opportunity. Today, you can't even pay previous BB developers to work on BB, they have moved on and want to enjoy their work. The few sticking it out know they can charge pretty much whatever rate they want. A smart phone without apps is a dumb phone.