BlackBerry has finally stated the obvious in it latest SEC Filing a few days ago – that Android and iOS helped bring down the once mighty BlackBerry, formerly know as Research in Motion (RIM). BlackBerry was once on top of the mobile phone world, shipping their first device in 1999, a two-way email pager. In 2003, the more conventional smartphone was introduced and supported push email, mobile telephone, text messaging, and web browsing, although BlackBerry mainly concentrated on push email. Throughout its history, BlackBerry maintained a certain amount of arrogance, as though they were untouchable, and it is this way of thinking that caused Mike Lazaridis and Jim Basillie, co-founders of RIM, to start their downward spiral from king to pauper.
In April 2011, when RIM released their first tablet, the PlayBook, Mike Lazaridis thought that apps were unnecessary, and believed that if you could access the internet there was no reason for apps…nobody could believe they were listening to the co-founder of RIM saying something so stupid. When confronted with the question of what RIM was going to do about the hoard of former BlackBerry owners leaving for higher performing phones, he basically said that smartphone users were a fickled bunch and would always run to the next best thing. And once BlackBerry came out with these great new BB10 phones that they would come flocking back for their BlackBerry…again, nobody could believe what they were hearing.
By the time RIM reorganized and renamed themselves BlackBerry, the writing was already on the wall. The new Chief Executive Officer, Thorsten Heins, was given the daunting task of trying to keep people excited about BlackBerry until the new BB10 Operating System (OS) was released on a new line of smartphones. BB10 OS was delayed from a promised launch of late 2012 (which went from October to December) to Q1 2013 (January or March) and ended up being announced on January 30, 2013 with the Z10, followed closely by the Q10. When asked why there was such a delay in their BB10 smartphones, in true BlackBerry fashion, Thorsten Heins stated they were only 2 months late, and once again, nobody could believe what he was saying. Below was his answer:
We wanted to make one thing really really clear Matt. And this is this product has to be of the highest quality so there is no compromise on quality. Could we have rushed it out? Probably yes. But the point is, it’s a new platform for the next 10 years. We want it to be stable. We want it to be reliable. We want it to be of high quality. And in light of this, I think a delay of two months is disappointing, and the whole team is disappointed, but they will continue working hard and get it out in the first quarter and we’ll get it right.
Quite the salesman trying to explain it all away. The first straight answer from BlackBerry came out in their annual SEC filing:
The smartphone market is maturing, resulting in lower growth rates, particularly in the higher-end segment of the market. The Company has experienced a decline in demand for its products and in its overall market share. The intense competition impacting the Company’s financial and operational results that previously affected demand in the United States market is now being experienced globally, including in international markets where the Company has historically experienced rapid growth. The increase in competition encountered by the Company in international markets is due to the recent entry into those markets of global competitors offering high end devices that compete with the Company’s BlackBerry 10 devices, as well as other competitors targeting those markets with lower end Android-based devices that compete with the Company’s lower cost devices. The decline can also be attributed to consumer preferences for devices with access to the broadest number of applications, such as those available in the iOS and Android environments.
I feel sorry for the BlackBerry employees and the reputation that BlackBerry once had – I was once a proud BlackBerry owner for a few years, but simply could not wait for them to catch up to the other OSs and hardware, so I switched to Android and never once thought of going back to BlackBerry. They had their time, they had control of the industry, but they were too arrogant to properly make adjustments to their hardware and software when the iPhone came out in 2007 and changed the playing field. They also ignored the Android OS in 2008, but it has now grown to over 70-percent of sales worldwide. It will be interesting to see where BlackBerry stands after the dust settles – they were just ill-equipped to fight the little green robot.