Tuesday, November 17, 2015

What Happened to the BlackBerry?
(Ben Peters)

In one of the assigned articles for this week, “Seven Ways to Fail Big”, the author details seven common strategic mistakes that can eventually doom a company. As I read through the list, I couldn’t help but think about the company RIM, famous for its BlackBerry smartphone, who I think was guilty of several of these mistakes. Ten years ago, I can remember almost everyone had a BlackBerry device, and now it would be nearly impossible to find anyone who still uses one. I can’t think many other products in my lifetime that have vanished from relevance so abruptly. We can now look back on RIM’s strategic missteps and learn a valuable lesson.

One mistake RIM made was not following a coherent strategy. In 2007, more than 1 out of 3 smartphones purchased were BlackBerrys. The phone had the reputation of being the best available, and was the preferred smartphone in the business world. Rather than continuing to build on their strengths in the mobile phone market, RIM put development and marketing aside for the BlackBerry and focused on building a tablet. As a result, the BlackBerry lost some of its steam in the smartphone world, and the tablet project turned out to be a failure. The first iPhone was released shortly thereafter and began stealing RIM’s market share.

Another mistake RIM made was “Staying the course”. RIM’s CEO didn’t see the iPhone as a big threat, and couldn’t anticipate the changing smartphone market. The iPhone had touch screen capabilities and allowed third-party apps, putting it years ahead of the BlackBerry.

Once the people at RIM realized that they were losing serious ground to the iPhone and Android, they began to make a series of “quick fix” strategic moves that tried to copy the features of the iPhone. They released a touch-screen BlackBerry device with an OS that wasn’t optimized for a touch-screen phone, causing poor performance and negative reviews. RIM also launched its own app store, about a year after Apple, which failed to differentiate itself and never caught on. At this point, the BlackBerry was too far behind its competitors and had little hope of competing.    

In the end, RIM’s downfall was that it severely underestimated its competitors, and it made the wrong technology bets. Surprisingly, RIM has not gone bankrupt yet and is supposedly scheduled to release a new version of the BlackBerry next year. It will be interesting to see how the product turns out and whether or not the company can make a comeback.

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