Opinion: New Hardware Is Only Half RIM's Battle
If RIM's BlackBerry 10 devices fails to bring its maker back to life, it won't be the device's fault. Rather it will be how far RIM has fallen and the extent to which that decline has left a hole in its ecosystem much bigger than hardware.
In case you've forgotten the heights from which the company credited with inventing the smarpthone has actually fallen consider that in June of 2008, shares of RIM were trading at nearly $145. By February of 2011, the stock had dropped to $70 per share. After a 3 percent loss today, the Canadian OEM is trading at just above $15.
Market share? During the first quarter of 2009 RIM controlled right around 20 percent of the global smarpthone market. Today, its slice of the pie has been nibbled down to right around 6 percent.
But that's just a quick charting of the company's course over the past four years. Beneath all that, and what has arguably been lost the hype around BlackBerry 10, is that RIM really did lose touch with what consumers wanted in a very big way. Has the entire world forgotten that?
Granted, from all the leaked videos, it really does look like RIM has made a huge step forward in the hardware and UI departments but one look at the 'Top Rated' apps in the new BlackBerry World storefront and you get a sense of how truly deprived users of the company's devices have been over the last couple years.
The top rated apps at BlackBerry World are a signal booster, an SMS blocker, and a flashlight app, among other equally scintillating items. Beyond that, many of the most popular apps on Android and iOS are completely absent. For instance, BlackBerry users don't have dedicated apps from any of the following companies: Netflix, Hulu+, Hipstamatic, Instagram, Google Maps, Flipboard, Amazon Kindle (among many others).
I'll concede two things here, but with a couple of caveats. The first is that maybe business users aren't all that interested in entertainment apps, but with this concession I have to ask whether part of RIM's big comeback by necessity must include clawing back market share from the consumer segment? The second concession is that RIM has pitched its HTML5-infused QNX-based browser as the salve for a lack of popular apps. My caveat here is a big finger pointing at Facebook and Zuckerberg's admission that HTML5 is NOT where it's at (at least not yet).
The hole in RIM's ecosystem is clearly in the content segment and the companies that are ahead in this area are dangerous. Even Amazon has a chance at pulling something out of its hat. And given Nokia and Microsoft's struggles, even on strong hardware and pretty OS, that shouldn't the whole world be a little bit skeptical that there are going to be a huge number of Android and iOS faithful jumping ship for a new BlackBerry?
Jan Dawson of Ovum backs up this point. In a recent blog post, he writes that "analysis suggests that RIM has always sold about half its devices to new customers and half to existing customers upgrading to a better phone. For much of the last two years, the portion bought by upgrading customers has significantly outweighed the portion bought by converts, and this makes it all the more important for RIM to retain existing subscribers."
Perhaps RIM's only saving grace is that it's hitting the market at a time when Apple's growth appears to be slowing. Who knows, it might even catch a few Apple faithful, bored with the status quo and on the rebound after being stung by that awful Lightning Connector.
The question for RIM is whether the Crackberry addicts of 2008 can be brought back to their original vice? Or has the world moved on? It would be great to say that consumers will buy a BlackBerry 10 device and wait for all the pieces to fall into place but the adoption of technology has never really worked that way.