Is it time to ditch your Black-Berry? Research in Motion Ltd., the company behind this iconic product, has been suffering from negative market opinion lately. The price of its shares has been down, its products have failed to wow users and, most recently, it suffered from a global service outage that lasted for days and caused co-CEO Mark Lazaridis to apologize publicly. What does all this mean for users?
It may be time to reconsider the Black-Berry. A look at recent technology-related events may help you make a decision.
Things started to go sideways for RIM in the run-up to the launch of its Playbook tablet computer. In June, the company published financial results that fell short of expectations. Sales simply weren’t up to par, causing the market to slash its share price dramatically.
When RIM launched its long-awaited Playbook, people had been hoping it would be a viable alternative to the incumbent, Apple Inc.’s iPad. The reviews, sadly, have been less than glowing.
The Playbook uses QNX, a new operating system that RIM had bought from Harman International Industries Corp. in April 2010. RIM had made the acquisition because its existing BlackBerry OS was beginning to look a little antiquated, especially in the shadow of Apple’s iOS, which powers both its iPhone and iPad devices.
The Playbook was the first RIM device to use QNX. Unfortunately, it was hurriedly released with no built-in email client or calendar components. These shortcomings have proved to be a sticking point with analysts and others reviewing the product.
Getting tablets to market quickly has been the stumbling block for more than one company. Motorola Mobility Holdings Inc. suffered from “premature product release syndrome,” pushing out its Xoom tablet this past February before it was really ready. Then, Hewlett-Packard Co. struggled to release its TouchPad in July and then suffered from poor sales. In August, it discontinued the tablet and sold off all remaining inventory at a heavily discounted price.
Software updates have fixed some of the tablet vendors’ problems. RIM has since unveiled an email client and calendar for the Playbook, but the damage has already been done. And HP has announced that it will be selling off WebOS, the software behind its now discontinued TouchPad, soon.
RIM is now in the unenviable position of having to leapfrog from one operating system to another. At the time of writing, all of its smartphones are still running BlackBerry OS, but we know that it is preparing QNX smartphones for release early next year. The first is likely to be the BlackBerry Colt.
RIM’s first QNX product having been such an early disappointment, the company will have to work extra hard to convince customers of the QNX OS’s benefit for RIM’s next generation of smartphones. In the meantime, RIM has to persuade customers to continue buying BlackBerry OS smartphones in the knowledge that the operating system’s days are probably numbered.
Microsoft Corp. had to go through similar problems, when it shifted from Windows Mobile to Windows Phone 7. The company has taken a battering in market share, but it had the advantage of other revenue streams, giving it some leeway as it rebuilt its mobile phone business.
All of these business challenges will have an inevitable effect on RIM’s products — and, therefore, on its customers.
To cap it all, Lazaridis had found himself sitting uncomfortably in front of a video camera in mid-October, making a humbling public apology for the global service outage, which prevented people from accessing up their BlackBerry email. “I’d like to give you an estimated time of full recovery around the world,” Lazaridis said, “but I cannot do this with certainty at this time.”
How humiliating for a company that prides itself on its position in the enterprise market — a market that values reliability and quality of service. The service has since been restored, but it had left customers in limbo for four days.
So, what’s next for RIM? And, perhaps more important, what’s next for you? Should you buy a BlackBerry smartphone the next time that you upgrade, or are you considering other options?
Apple has achieved stunning success with its iPhone product, which was launched primarily as a consumer device. But both the iPhone and the iPad are targeting the enterprise space, too.
A survey of 4,000 enterprise customers by mobile enterprise app vendor Good Technology Inc. found that the financial services sector is adopting the iPad as a business tool more than any other market. For several years now, Apple also has been poaching RIM enterprise sales staff as part of an initiative to capture “corporate mind” share.
In any case, for financial advisors, the enterprise angle is less important. There is a good chance you work in an office with 10 people or fewer, and have autonomy over the smartphone that you choose.
Even in larger organizations, “consumerization” is affecting the way technology is purchased, giving users more leverage when it comes to choosing their devices.
Outside of the iPhone, which Apple just upgraded with an interim “4S” release, Google Inc.’s Android operating system represents an alternative. Google recently announced its purchase of Motorola Mobility, which gives the former access not only to a large proportion of the cellphone handset market but also to a broad base of patents that will be a useful part of its arsenal in the intellectual property war that is brewing between the various handset vendors.
Some key investors in RIM have called for a change in leadership. Vic Albioni, CEO of Toronto-based Jaguar Financial Corp. and an activist investor in RIM, says that action must be taken now, lest the worst happen and the firm be forced into a sale, or worse.
Says Albioni: “What’s worse: having RIM suffer a declining fate and, however unlikely, bankruptcy; or selling it? We should be proud to wave the flag and see if we can fix this. But if the board says that it can’t fix it and it needs to be part of [another company], then so be it.” IE