Rudderless RIM Must Get Back to Business Roots
The news from BlackBerry maker Research in Motion just gets worse and worse. Last month, the company suffered a three-day email outage that had millions of users around the world unable to send or receive e-mail from their phones. Last week, the company announced it had delayed the next version of its tablet operating system, PlayBook OS 2.0, until February. Last but not least, a group of consumers announced they were filing a class action lawsuit for the outage.
This week we learned that the company’s U.S. market share has dropped to just 9 percent from 26 percent a year ago. BlackBerry users now account for just 2 percent of mobile web visits compared to 4 percent last December. The company’s stock now sells at $18, where it sold for more than $56 a year ago. So what is the company doing to staunch the bleeding? Ignoring what made it a success in the first place, of course.
Based on recent initiatives, RIM is refocusing on entertainment, launching BBM Music, a $4.99-per-month service that lets you have 50 songs a month from its catalogs and also listen to your friends' 50 songs. RIM is also working closely with a number of game developers to bring their titles to the PlayBook tablet. Like Justin Bieber trying his hand at acting or Mr. T rapping, RIM's attempt to rebrand BlackBerry as a play platform will not end well. The company needs to go back to its roots and focus on what mobile business users need in 2011 and beyond.
Don't bother telling anyone at RIM that they have bigger problems than how many high-res games you can buy in the BlackBerry AppWorld store. I was at the company's BlackBerry DevCon two weeks ago, where I got a sense of the company's new direction. During a two-part, three-hour keynote, RIM showed demo after demo of games and social media apps running primarily on its tablet. But the company spent only a few minutes talking about security in the form of a demo showing how work and personal data can be segregated on the PlayBook tablet.
The Outage Outrage
If you attended the keynote and didn't know better, you might think selling business-friendly smartphones is a small side business for RIM, as the company didn't unveil any new handsets and barely showed phones on stage. Company CEO Mike Lazaridis spent exactly 30 seconds talking about the very serious e-mail outage that had occurred just a few days before. He said only:
"The world-wide outages we experienced this week were unfortunate. We restored full service as quickly as we could. Now we’re focused on the root cause analysis, our internal systems audits, and making this right for more than 70 million BlackBerry users around the world."
But for businesses that outfit their employees with BlackBerry phones, losing e-mail access for several days is more than "unfortunate," it's downright dangerous. According to one survey, 19 percent of BlackBerry users lost business as a result of the outage! Imagine if you're a stock broker and a client tries to e-mail you to initiate a trade or if you're a real estate agent and someone sends a bid on a home. If those messages arrive late, your clients will go elsewhere. Receiving a free copy of Shazam, a music app that already comes free on iOS or Android, won't make up for your loss. Even getting a few dollars off of your phone bill—something most users aren't getting—seems like cold comfort to someone who has lost thousands.
The sad truth is that, in 2011, RIM's method of routing all mobile e-mail messages through its own servers creates too much risk for too little reward. Businesses like BlackBerry Enterprise Server because it provides stringent security and gives the IT department tight control over users' handsets. Some BlackBerry fans like that BIS—the consumer version of BES—allows them to filter e-mail before it even gets downloaded to their phones. But by allowing RIM to handle all their messages, both groups are introducing another point of failure into the critical e-mail delivery chain.
Isn't it risk enough that your corporate Exchange could go down or your ISP could experience an outage? No other mobile platform requires you to trust your handset maker with your data. Apple could go out of business and you'd still be able to get all your e-mail on your iPhone. Google's server farms could burn to the ground and you'd still be able to connect your Android phone to your company's Exchange server. In fact, with Exchange, IT departments can now exert fine control over users' Android phones, even remotely wiping them if necessary.
Outdated Hardware and Software
If its 1990s-era method of e-mail delivery wasn't bad enough, RIM's 2009-era handsets are even worse. It's as if Lazaridis and company have been living in a bubble where they can't see what the competition is offering. Just this week, BlackBerry unveiled its Torch 9810 on T-Mobile. For $249, you get a 3G keyboard slider with a whopping 3.2-inch screen, a 1.2-GHz single-core CPU, and a 5-megapixel back-facing camera. Apparently, nobody in Waterloo, Ontario has heard that you can get the dual-core, 4.3-inch-screened HTC Sensation 4G for just $99 on T-Mobile, or that the iPhone 4S costs $199.
Even the company's popular BlackBerry Messenger service, which many see as a selling point, feels dated in 2011. Why rely on BlackBerry for real-time messaging when you can always chat on Gtalk, Facebook chat, or any of a dozen other mobile IM clients—all of which work across multiple platforms?
Perhaps the company wants to be known as a maker of classic nostalgia technologies rather than current ones. At a press event for the PlayBook last spring, the company gave each reporter an odd goodie bag filled with an expensive array of old-time swag. Each reporter received a leather-bound journal, a 35mm vintage Lomo-style camera, and a blank plastic figurine to draw on. At its DevCon party, the company filled a room with vintage toys such as Rock 'Em Sock Robots and air hockey tables. Is RIM trying to compete with Apple and Samsung or rotarydialphones.com?
Business Communications: The Next Frontier
If RIM wants to stay relevant, it needs to make a compelling case for itself with productivity-oriented users, not gamers and media mavens. BlackBerry's killer app has always been communication, but e-mail and instant messaging have become commodities that most people are happy to get from Google, Microsoft, and other vendors. However, there's still a very important niche that's wide open to RIM: mobile conferencing.
Look around the industry and you'll see a lack of serious video conferencing or mobile meeting solutions. FaceTime on iOS provides a smooth chat experience over Wi-Fi, but doesn't offer business-level security features or the ability to share much more than your face. Video talk on Android is a bad joke, with Gtalk, ooVoo, Qik, and Skype all providing blocky, jerky images and unstable connections in our tests.
Business users are just waiting for someone to bring telepresence-style video and fantastic remote meetings. You can already run Citrix GoToMeeting on a tablet or handset, but what if RIM supercharged mobile communication by making it faster, more secure, and more IT-manageable than ever?
In order to provide the world's best mobile conferencing/meeting solution, RIM would need to leverage its already-taxed servers for video, write some pretty compelling video meeting software, put front-facing cameras on all its devices, and it would need to finally support 4G. I won't hold my breath.
Refocusing on providing the best business communication experience would help RIM stop the bleeding, but right now its executives are too busy gaming while Waterloo burns.