Crunch time for once-dominant BlackBerry

NEW YORK: The launch of BlackBerry 10 on Wednesday in the US is seen as the last roll of the dice for the ailing Research In Motion and its attempts to revive the once-beloved “CrackBerry”.

BlackBerry was the dominant player in smartphones just a few years ago, but millions have since deserted the platform in favour of Apple’s iPhone and Google’s Android.

Where once IT managers selected staff mobile devices and many workers kept a work and a personal phone, today employees expect to bring their own personal devices to work and have them connected to the corporate network. When they are given a choice of phone by their employer, BlackBerry is far from the top of their wish list.

Qantas, IBM, Woolworths and Dell are just some of the Australian organisations that have reportedly dumped BlackBerry recently. Australian public servants have also been gradually moving towards Apple, and this trend is mirrored by government workers worldwide including the US Department of Defence and US Immigration and Customs Enforcement.

Qantas announced in July last year that it would save millions of dollars each year by retiring its 1300 BlackBerry models and switching to iPhones, as well as a worker “bring your own device” policy.

A Qantas spokesman said the move was made “in response to feedback suggesting a strong preference for the Apple device”. Since the replacement program was carried out in September and November last year, “98 per cent of employees said they were happy with the process and outcome”.

Analyst firm Gartner reported that BlackBerry captured just 5.3 per cent global smartphone market share in the third quarter of 2012, down from 11 per cent a year earlier. In that period Android has climbed from 52.5 to 72.4 per cent.

RIM hasn’t had a significant new product in more than a year and its last major device, the PlayBook tablet in 2011, tanked. BB10 has been beset by several frustrating delays.

“This first quarter, January to March, really is make or break for RIM because if the consumers don’t like BB10 then enterprises won’t commit, and this means that the bankers will really move in on RIM,” said IBRS analyst James Turner, who recently filed a research note on BlackBerry.

Jan Dawson, chief telecoms analyst at Ovum, believes BB10 will provide only a temporary boost in performance “but no salvation” for RIM.

“RIM continues to face the twin demons of consumer-driven buying power and a chronic inability to appeal to mature market consumers,” Dawson said. “There is nothing in what we’ve seen so far of BB10 that suggests it will conquer the second of these demons, and the first is utterly out of RIM’s control.

The core BlackBerry advantages – great keyboards, real-time email/messaging and security – have become less pronounced as competitors have caught up. Where BlackBerry Messenger once stood out, the functionality has been replicated by dozens of apps such as WhatsApp, while real-time email and the ability to hook up with corporate networks is now a standard feature.

Meanwhile, BlackBerry has fallen far behind in such areas as apps, fast internal hardware required for multimedia, web browsing experience and camera quality. This has been a deal-breaker for many consumers who want one device for both work and play.

At its launch event in New York on Wednesday, RIM is expected to unveil at least two devices running its new, completely revamped BlackBerry 10 operating system. One will reportedly be a 4.2-inch full touch-screen device, while the other will have RIM’s trademark hardware keyboard.

The company has been leaking like a sieve ahead of the launch, with several documents, pictures and internal training manuals appearing on the web.

RIM has also held dozens of developer events around the world, hoping to flesh out its app store. It has guaranteed certain pre-approved apps will generate $US10,000 ($A9600) in revenue in the first year or the company will make up the difference.

Several RIM executives appeared in a music video last year designed to butter up app developers, which was set to REO Speedwagon’s Keep On Loving You. It was widely ridiculed but it may just work, with the company promising at least 70,000 apps available at launch.

RIM is gearing up for a major marketing blitz for BB10, including a reported $US3.8 million US Super Bowl ad.

Turner said RIM was taking a page out of the Apple playbook and going to “extremes with the hype” ahead of the launch, which he said “smacks of desperation”.

He said ultimately consumers need to love BlackBerry 10 or it will fall flat in the business world – a huge shift from RIM’s previous focus on the enterprise.

Turner has spoken to several Australian organisations about their switchover from BlackBerry. While refusing to name names, he gave several examples of what he found:A financial services organisation began giving employees the option of either an iPhone or a BlackBerry a year ago and iPhones now account for 40 per cent of the fleet.An IT executive from another organisation said staff were being moved to iPhone or Android as their phones came up for renewal and now only 20 per cent – those on two-year contacts – remained on BlackBerry.Another executive said that after offering both BlackBerry and iPhones to staff, the iPhone now accounted for 90 per cent of the fleet.

In what feels like the blink of an eye, smartphones have become a two-horse race.

While Samsung dominates mobile phones globally – shipping one in four mobiles or 396.5 million handsets last year, according to Strategy Analytics – Apple still has a strong hold on Australians.

Apple pulled in a record $5.99 billion revenue in Australia in the year to September 2012, up 22.9 per cent on the previous year, according to results filed with the Australian Securities and Investments Commission.

Not everyone is deserting BlackBerry, though.

NAB told Fairfax Media that the BlackBerry “fits our purpose” by offering “a combination of being able to make calls and emails backed by good security”. Some staff were using them alongside devices such as the iPad.

ANZ told Fairfax the BlackBerry remained its “corporate standard, but we are continuing to track and assess the market”.

RIM’s board ousted co-founders Mike Lazaridis and Jim Balsillie last year amid the BlackBerry freefall and several horror quarters, such as one that generated a whopping $US643 million loss.

The CrackBerry has now become an expensive habit for RIM, as consumers debate whether to give it up for good.

Asher Moses travelled to New York as a guest of RIM.

The original release of this article first appeared on the website of Hangzhou Night Net.

Related Posts

Comments are closed.