Intel experienced it, IBM experienced it, Apple experienced it and now one of the most iconic brands of the smartphone revolution is experiencing it. Most of these brands rose to prominence amidst a tide of new technology, went on to become the market leaders, experienced calamitous decline but re-invented themselves back to relevance. Of the three, only IBM is experiencing a turmoil in its business as it seeks to avoid reverse quarter over quarter declines in revenues. This then leads me to the big question, can Blackberry really get its groove back?
2013 was a difficult year for Blackberry, then called Research in Motion. Firstly, the firm was late in launching to market a much needed OS update, Blackberry 10 operating system. Blackberry 10 OS was to succeed the Blackberry 7 OS that had propelled it to the upper echelons of the smartphone market. The delay was compounded by among other reasons the decision to rewrite the Blackberry OS 10 from scratch. Blackberry had in 2010 acquired a fellow Canadian company QNX that specialized in creating software tools to run applications ranging from call centers to vehicles software. The decision however , lagged for nearly a year eating up precious time.
Amidst the delays, Blackberry was facing an emerging threat which was the increasing proliferation of Apple iPhones launched three years earlier and the emergence of the Android operating system. These two were eating into the share market of Blackberry that was declining at a first rate. When the Apple iPhone launched, the execs at Blackberry dismissed it. The iPhone’s OS took up 700 megabytes of memory and ran on two processors. The iPhone also had a web browser with fully enabled internet capabilities.
Blackberry ran on one processor and its OS took up a mere 32MB of storage. Blackberry browser limited data usage which made it a darling of internet service providers unlike the iPhone whose browser was set to gobble up network resources of the mobile networks. A plan was soon established by Blackberry and mobile networks in the United States to launch the iPhone killer.
Blackberry launched the Blackberry Storm, a neat phone aesthetically but disastrous to use. I used the Storm around May 2011 as a freshman in Campus albeit for a few hours and it was slow and non-receptive for a touch screen device. It ran on a single processor which made it all the way buggy. The Storm failed to pick up as expected, let alone kill the iPhone. The mobile networks approached Android to create a device capable of competing with the iPhone leading to the birth of the Motorolla Droid in 2009. The droids begun stealing the market share of the Blackberry and that my friends was the beginning of the long rough road.
Still on 2013, Blackberry launched the Blackberry Z10 and Q10, two phones that failed to pick up. Initially, the phones received positive reviews from Tech blogs and major magazines but failed to live up the expectations of most consumers who had since, moved to rival operating systems. A large volume of the devices remained unsold and were later written off. The marketing campaign for the same also failed to kick off with the Alicia Keys who was to be the Global creative director using her iPhone on targeted Blackberry campaigns. The Blackberry Z10 was late, actually very late to market and this made it practically impossible to compete with the droids and the iPhones that were then beginning to reign supreme.
A series of other bad decisions were also responsible for the decline such as the launch of the Blackberry Playbook Tablet. The Playbook was to be the answer to the Apple iPad but flopped miserably. First it delayed to launch to market. A date was set for launch in Q3 of 2010 but delayed till April 2011. It also sold as an accessory to Blackberry instead of working as a standalone device meaning it lacked applications and basic email capabilities, a fete Blackberry was well known for.
Perhaps the most painful and expensive decision by Blackberry was lack of applications. With migration from Blackberry 7 to Blackberry 10, Blackberry never bothered to help its developers transfer their software to the new operating system. They actually had to rewrite the applications for the new platform if they wanted to remain on Blackberry world making them disgruntled and many never bothered to rewrite them. Blackberry also had to make a decision as to whether it wanted to continue making devices for corporate customers and the general public. It chose the former.
In fact, Blackberry invited most of its corporate clients to a meeting in 2010 and showed them a strategy that involved adding enhancements to camera, improving games and music applications offering to its devices. Most of the corporate clients were not amused having these features on these work devices and Blackberry shelved the idea for later. At the same time, the general public cared less about a Blackberry device with strong security features or saved on data but wanted applications on their devices. This led to Blackberry being left behind by apps such as Instagram (we are yet to get a stable build), Tumblr and the like.
Finally 2013 gave Blackberry hope. In 2013, Blackberry was able to get the man at the helm right now, John Chen. I must admit that unlike his predecessors, he is more aware of the reality and knows what Blackberry needs at the moment. Blackberry is no longer the hardware focused company anymore and hacking that market will be an uphill task. Even if Blackberry aped the designs of the Apple iPhone or decided to give the consumers an android powered devices, that is unlikely to work.
HTC and Huawei have some of the best designed smartphones but still have a near negligible market share. To get back in the game, Blackberry has to re-align itself and channel its energies towards the software offerings. Blackberry can now focus on providing corporates who, previously left Blackberry at the altar with ultra secure software to run their business. It can also continue to produce devices but targeted at a niche. The firm can also become a market leader in emerging technologies such as the Internet of things. It can also lead in providing mobility solutions for the developing markets. All these are strategies John Chen has laid an emphasis on.
How will Blackberry get there?
To ensure it locks in accounts of key customers such as governments, military and large corporations with regards to software solutions, Blackberry has been on a spending spree buying startups including WatchDox and Secumart seeking to provide robust solutions for enterprise and government clients. By positioning itself in this segment . Blackberry is hoping to rely on its thousands of patents as well as its market leadership as far as security goes to push uptake of its software offering. In addition, Blackberry is now providing its solutions such as BES 12 server solution in a ubiquitous model which makes them available for all operating systems which will place in the hands of more consumers.
Blackberry is further targeting the developing economies through hardware solutions such as cheap devices that include the Blackberry Z3. Many users in these countries are currently migrating from using feature phones to smartphones which makes the provision of low end devices appealing. In addition, most of the users in these nations hold multiple SIM cards. Blackberry acquired a UK based Startup Morvitu, that provides virtual sim solutions to users meaning one user sim card can represent up to 9 sim cards. This is a big boon for consumers in the developing markets.
Blackberry can still focus on hardware with devices a move that he been recently reaffirmed with the launch of the Blackberry Passport, the Leap as well as the upcoming launch of the Blackberry Slider and Oslo. The devices have focused on an out of the norm form factor and reception thus far has been more than positive. The company is also aiming at its resources such as QNX, that develops software for vehicles to drive sales and uptake. At the same time premiering solutions for emerging fields such as the internet of things.
Blackberry also has BBM. Jim Balsillie, was the former co-CEO of Blackberry who had worked out a novel plan to kill SMS using BBM. The plan was to make BBM available for all devices on different mobile networks and thus earn royalties and fees. BBM was created in 2005 to enable users to communicate by using their devices through PINs. Users would know when a message had been delivered and when it had been read, marked D and R as is the case today. The plan failed to take off and Blackberry made the platform cross platform when it was too late but still witnessed popularity in uptake upon launch. BBM has been a new source of revenue for Blackberry through BBM store that sells stickers and channels that allow for news and ads publishing. Blackberry can be a interesting choice for acquisition seeing as Facebook acquired Whatsapp for $19 Billion.
So will Blackberry rise again like the companies stated? Only time can solve that conundrum. My thoughts? the late Great Blues maestro Muddy Waters sums it up for me with Got My Mojo Working. I think Blackberry got their Mojo working. At least the fan boy in me does.