Cheering for BlackBerry

by Steve Wildstrom   |   January 27th, 2013

BlackBerry invitation header

On Wednesday, Research In Motion will launch its bid to save itself with the redesigned from the ground up BlackBerry. I’ll be at the launch event and I will judge the new hardware and software on their merits, still I have to admit that I am cheering for a BlackBerry comeback.

Apple reinvented the smartphone in 2007, but before that, the most important smartphone innovations came from Palm and RIM. Palm’s Treo (actually, the original version came from Handspring, a company started by Palm’s founders and later merged back into Palm) invented the concept of integrating a mobile phone and a PDA, along with third-party apps. The original BlackBerry, which was not a phone, created true mobile email and calendar. Eventually, this all came together to create the modern smartphone, which Apple took to the next level with the iPhone.

The iPhone did in Palm and nearly killed RIM. The decline of Palm was inevitable. The company was always cursed  by under-financing and a lack of stable, competent management. When Apple turned up the heat, Palm lacked the wherewithal to respond successfully with its reinvention after its purchase by Elevation Partners was too little, too late. Its demise after a horribly bungled acquisition by Hewlett-Packard was a somehow fitting  ending to a very sad tale.

RIM is a very different story. Palm knew what was happening to it but couldn’t do much about it. RIM, riding high as BlackBerry sales continued to soar well into the iPhone era, but lacked the paranoia than Intel’s Andy Grove long ago pointed out was a key to survival in a highly competitive industry. RIM co-CEOs Michael Lazaridis and Jim Balsillie were convinced of the superiority of their product and their business model and failed to respond to the market’s shift toward demanding highly capable handheld computers, not glorified messaging devices.

Fortunately, RIM, unlike Palm, had deep financial resources and significant annuity revenue streams that bought it another chance. It has two reservoirs of strength, the popularity of its low-end devices in emerging markets (where volume sales can be had, but profits are scarce) and enterprises, especially governments and others with the greatest concern about security. Success in neither is a given, but the opportunities exist. And I’ll admit to a long-standing fondness for RIM, particularly Mike Lazaridis’ uncontained enthusiasm when he talked about his newest BlackBerry or showed off a lab at RIM’s Waterloo, Ont., headquarters.

I think that both Android and Apple would benefit from some additional competition. Microsoft, despite heroic efforts, has so far failed to win much traction in the mobile market. Had Windows Phone and Windows RT taken off, there wouldn’t be much room for a RIM comeback. But they haven’t, so there is. It’s going to take a spectacularly good product to succeed in this tough neighborhood. I’m hoping that RIM still has it in them.

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.
  • FalKirk

    My argument against the resurgence of RIM has nothing to do with their hardware or software. It has to do with whether one is copying the market or leap frogging the market.

    Apple didn’t make a better phone with the iPhone. They leap frogged the existing market in smart phones by making a wholly different and disruptive pocket PC. Google quickly followed with Android and they too have enjoyed mega-success. After that, Palm, and Microsoft introduced “me-too” products. Their products were too narrowly differentiated, to cause disruption.

    I just dont’ think there’s room in the mobile markets for RIM’s latest offering. Instead of trying to do the iPhone one better, they needed to create a wholly new category of product. RIM is too far behind the iOS and Android to ever catch up. The only way to win was for them to start a whole new race in a whole new category of devices. That’s what Apple did with the iPhone and that’s what Palm, Microsoft and now RIM did not do.

    • steve_wildstrom

      In fairness, we do not yet know what RIM has done. Let’s wait until Wednesday and let them make their case.

      • FalKirk

        “… we do not yet know what RIM has done…” – Steve Wildstrom

        Quite true. My guess is that RIM’s hardware and software will be quite good. I’m trying to lay out a philosophical argument as to why even superior hardware and software might not make a difference.

      • capnbob67

        The leaks are pretty clear… fast browser, home/work sandboxing, mediocre app support (so far). Competitive but not leapfrogging.
        I stand to be corrected by Thorsten…

  • http://twitter.com/jaggubrampton Jagdeep Singh

    Roughly in 2 Days it will be clear for sure who is the winner here. If we talk about a leap frog product. Yes BB10 pretty much is.This is history in the making.

    You guys can laugh on me but i am rooting for our Canadian RIM.

    • capnbob67

      Watch out, your bias is showing ;-)

      Good luck to RIM but “hoping don’t make it so”…

  • pawhite524

    For me, too, it is hard not to root for RIM. It is not entirely rational or emotional but I root for those who do a good/great job succeeding. I have an in-borne abhorrence to flavor of the month and clever marketing without substance, i.e., current Samsung (iPhone users are idiots) and Surface RT ads (with parochial school girls looking like sex zombies and out products click!).
    So, best wishes to RIM.

    • Rich

      I thought the Surface RT ad was pretty silly. It was like Microsoft was promoting a dance routine and not a computer product.

      • jfutral

        They should have used those commercials for the Zune. It might even still be around if they had.

        Joe

    • Walt French

      RIM’s failure was, as Steve noted, that it fell in love with its own PR. I’d challenge you to show why it’s smart to judge Samsung & Microsoft by their advertising.

      To me, BlackBerry is shorthand for “a product that was laser-focused on great messaging technology” (to use current buzzwords). Hard to see why you’d root for THAT in 2013. Now, the firm that recognized the need for that tech, and built it, yes; but the very same firm that a couple of years later failed to recognize how that tech had been superseded, and decided to rest on its laurels? Not so much.

      Tough world out there: what has RIM done for you lately? Why should you be confident (or even, hopeful) that they’ve morphed from the firm that dismissed the iPhone, and came out with the woefully rushed Playbook? Yes, they’ve made some changes, but this is a firm that’s cut a lot of its talent, going up against techdom’s giants.

      • jfutral

        Yeah, I have to agree. It is kind of hard to not see that Rim has/had fallen into the Lotus 1-2-3/Wordperfect syndrome. Maybe the new guy on top is better than his predecessors. I hope so and I hope it isn’t too late.

        Joe

      • pawhite524

        Thank you for taking the time to reply. Their are a number of points, none life threatening or earth shattering, to which we disagree.
        You have addressed these issues, IMHO, as an articulate gentleman and for that I thank you.
        In this instance, I ask that we agree to disagree. I am being neither facetious or sarcastic when I wish you all the best.

  • http://twitter.com/jwyoungy Jamie Young

    I have been reading every article I can find on blackberry and rim for the last year. In Oct. I bought stock because I have a bit of an idea of what QNX is, what it does and what it has the potential to do. FalKirk speaks of the iphone being a game changer but not this new blackberry. I phone was a game changer. It rode the boom of ipod and mp3 sales into the smart phone market. They actually make terrible phones remember, drop calls all the time. BlackBerry 10 is a game changer but it may take a couple of years to see just what a game changer it is. I suggest anyone guessing about RIM had better research QNX first. By the way, i’m up 71% on my investment and the phone is still two days from launch.

    • JDL

      It is the cell operator that drops the calls, droped calls don’t happen in western europe. BTW, in sorry for your loss ;-)

      • steve_wildstrom

        Call can be dropped by either the network or the handset. Better phones drop fewer calls, and BlackBerrys have always been specially good in the radio department.

    • FalKirk

      The iPhone was a terrible phone and a terrible emailing device but it was a superior pocket computer. This is the nature of disruption. The disrupting product usually underserves the existing market but it is superior in another realm that the incumbents view as no threat. The disrupting product is so good at what it does that customers are willing to take “good enough” in some areas in order to gain the superior capabilities in other areas.

      People learned to type on glass because they wanted the iPhone’s touch interface, the ability to view the web, and the ability to use apps. My guess is that RIM will try to improve on the iPhone, Android and Windows Phone 8. It’s nigh on impossible to disrupt an incumbent merely by being better. Better to create a new category (one of the hardest things there is to do) than to try to break into an existing category that is being served by strong and capable competitors.

  • Rich

    I think that when we talk about RIM’s future we need to specify what kind of future we’re discussing. The three broad categories are: great success; taking third or fourth place in the market and remaining there; and going out of business. My feeling, simply based on intuition, is that RIM is likely to occupy the second one.

    • steve_wildstrom

      I think you’re right. The chances of RIM unseating Apple or Android for one of the top two spots are slim. But this is a vast market, and third place isn’t such a bad place to be. Fourth is a bit sketchier, because I’m not sure there’s room long term for four platforms.

    • jfutral

      Boy if they could come up with a platform to challenge Google apps, I think they’d be the goto device for enterprise. The device would be niche, but what a niche!

      I hate using Google apps, but I can’t find a better solution.

      Joe

      • Walt French

        Gee, I wonder what OTHER phone and/or tablet company companies use since most of ‘em are abandoning BlackBerry, and find the Android security model frightening.

        On the tip of my tongue, but can’t quite remember the name…something about “Applications?”

        BTW, if you’re no fan of “Google apps,” I presume you have something besides just email that you think is better. But I’m thinking that it’ll be a tough sell to claim that BlackBerry delivers better maps. Better voice and search? Ditto. Better access to YouTube (which many business types use for interviews, news, etc., not just music and dancing baby videos).

        Or maybe you’re referring to the whole Android app library, and the bad news just keeps coming: very few developers will attempt native BB10 apps and BB will have to hope that they have a decent copy of the Android runtime engine. Also a risky bet.

        • jfutral

          Sorry I wasn’t clearer. When I said “apps” I meant what used to be called Google Apps/Docs, now called “Drive”, (which makes even less sense).

          If I were an enterprise IT guy and wanted to standardize on a platform as much as possible, I would want a platform other than Google/Android because of all the security and privacy issues. If Google wants my company’s data, they can pay money for it, not barter an exchange.

          But maybe this isn’t as compelling for BB/Rim as I think it could be. I mean, I love how platform agnostic Google Apps/Docs/Drive is. I have 50 people who all love _their_ devices. This also lets them do whatever they want with the information and I don’t have to constantly send out hard copy updates each time something changes. Not to mention all the venues we tour to (I am production manager for a touring performing arts company).

          The Google services/Android people have the least issues with my information mapping/dissemination. But I hate Google getting data from my company, and quite frankly I hate them getting data from me. I don’t even get the option to pay instead.

          Microsoft’s solution only works with MS products, no Mac/iOS allowed or only marginally so, never mind Android. Apple doesn’t really offer anything in this space. Dropbox really only handles file sharing well, not really this kind of information sharing. We have a VPN, but hat isn’t always accessible, and again is really only about file sharing at best.

          This is a solution I wish someone other than Google would address.

          Joe