BlackBerry and Nokia were once the most powerful smartphone companies in the world and even now, with over a year after their comeback, they have yet to excite or make a dent in the smartphone market. While neither company can ever expect to reach its previous sales – back in 2009, BlackBerry held 20-percent of the market share that has now shrunk to a minuscule 0.1-percent and Nokia held 40-percent, down to 1-percent – it was thought that BlackBerry and Nokia would put out a desirable product by now. Francois Mahieu, BlackBerry Mobile’s chief commercial officer said, “[With] Nokia and BlackBerry, there’s an expectation that they will take the world by storm in just a few months and dominate the market once again”, but he was much more realistic when he said that Samsung and Apple dominated the market, and BlackBerry and Nokia’s comeback would take time.
BlackBerry’s downfall was the direct result of its original management that thought the consumers would buy anything it produced because it was a BlackBerry. Management was not willing to increase the screen size, up the RAM and memory capabilities, and overestimated the importance of BlackBerry’s QWERTY keyboard. Older buyers loved the physical keyboard, but younger buyers loved the new touchscreen keyboard. Make no mistake, BlackBerry put a lot of design effort into its Storm and Storm 2 ‘click’ screens, but they were not received well and continued to use a small 3.25-inch display with little RAM and only 2GB of expandable memory up to 16GB. BlackBerry also misjudged its corporate partners into thinking that corporations would stick with BlackBerry because of its name and security features – only to find out that employees wanted to use their own smartphones and most corporations either allowed them, or purchased the more popular Apple or Samsung devices for them to use. This collective of events saw BlackBerry quickly dwindle from the corporate market share.
Nokia’s downfall stemmed from a well-orchestrated move by IBM CEO Steve Ballmer in which IBM sent Stephen Elop to take over as CEO for Nokia. Rather than switching the Nokia operating system to Android – the most popular OS in the world – Elop opted for the Microsoft Windows Phone platform that was going nowhere. The Windows Phone platform did not help Nokia grow, despite building some solid devices with outstanding cameras. With little market support for the OS when it came to the popular apps, the Nokia name dwindled into almost oblivion. Make no mistake that having a competing BlackBerry and Nokia device is a good thing for Android owners. Their relativancy gives more competition to Samsung, LG, and Apple. Their existence gives buyers more choice to a quality product – BlackBerry and Nokia always did put out a well-built product – and in many ways the companies were innovative for their time. BlackBerry messenger (BBM) and the Nokia Lumia 41-megapixel camera are perfect examples.
Back in December 2016, in an effort to save the BlackBerry name, it sold most of the rights to Chinese manufacturer TCL to design, manufacture, and sell BlackBerry-branded devices. This is not TCL’s first rodeo into buying other smartphone brands – back in early 2016, the purchased the rights to Palm devices, but never did anything with them. However, with the launch of the BlackBerry KeyOne at MWC 2017, TCL was calling BlackBerry’s return a triumph. With average annual sales revenue of about $16.5 billion, TCL is willing to give the BlackBerry name a few years to grow, but the time will come when BlackBerry will have to contribute to TCL’s bottom line. The elephant in the room begs the question, how long will it take for BlackBerry to be a real success.
Also in 2016, HMD Global took over Microsoft’s licensing agreement, but they were unable to generate much excitement even though they used the Android O/S – even the higher end Nokia 8 was a blimp on the radar. Nokia’s 4G flip phone is doing well in some global markets, such as India and some of the emerging nations where cost is a major consideration, but there is no grand jester being sold in the US. In order for any smartphone to exceed, it must have great distribution channels and the ability to distribute effectively the device. TCL has a very robust network of distribution, although sales for the BlackBerry brand has been poor with only 850,000 in sales in 2017. Even the KEYOne, whose sales were sluggish, helped BlackBerry by receiving a lot of media attention and brand recognition. Nokia has good distribution in the global markets in India and China, but BlackBerry has more US (Sprint and AT&T) and European (Orange and Vodafone) carrier visibility. Nokia needs the European and US markets and carriers, as most users buy their phone through their carrier. A high end device with the Lumia 41-megapixel camera would be a great start to capturing the eyes of buyers.
Both companies have a good global presence in the Far East and India, especially BlackBerry, but both really need to establish their US footprint if they ever want to regain some of their sales from yesteryear. Selling a cheap phone in third world countries could generate lots of low end sales, but a real flagship device – including a foldable phone like Samsung is working on – released on all US carriers could potentially help bring back the BlackBerry and Nokia legends – and a contribution to the bottom line.