Mac Musings

Is This RIM's Macintosh Moment?

Dan Knight - 2012.01.25 - Tip Jar

It was the best of smartphones. It was the worst of companies.

Before the iPhone debuted in 2007, the BlackBerry had become the smartphone of choice for businesses because it was designed especially for email - and its network was secure, separate from the Internet.

It was never the dominant smartphone brand or operating system. Symbian holds the distinction of most popular smartphone OS, and from 2007 through 2010, it dominated the smartphone landscape. In 2007, Windows Mobile held the #2 spot, followed by BlackBerry just slightly ahead of Linux - and the iPhone a distant 5th. In 2008, BlackBerry doubled sales to take the #2 spot from Microsoft, a position it retained in 2009 as well.

Android took the #2 spot in 2010, followed by BlackBerry and then the iPhone.

But in 2011, Android displaced Symbian as the most popular smartphone operating system, with Apple's iPhone holding third place at 18% and RIM dropping to just 12%.

Two big changes took place in 2011. First, Nokia announced in February that it would switch from its Symbian operating system to Windows 7, which could catapult Windows to the #2 spot - or alienate a lot of Symbian users. Second, there was the Great BlackBerry Outage of 2011. For 3-4 days, BlackBerry users were unable to access email due to a "failure in RIM's infrastructure", which is separate from the Internet everyone else uses.

In addition, RIM made some very bad moves in 2011, such as releasing its PlayBook tablet with absolutely no support for email unless it was tethered to a BlackBerry smartphone. (They did address this with an operating system upgrade earlier this year.) This past week, its co-CEOs resigned, and there are rumors that RIM is trying to find a white knight to swoop in and rescue the company.

If you followed Apple in 1996, a lot of this should sound familiar. Starting in 1995, Apple had attempted to grow the Mac market by licensing the Mac OS and authorizing Macintosh clones, a move that ended up eating into the most profitable part of the Macintosh product line. Although Apple sold 4.5 million Macs in 1995, it dropped to 4 million in 1996 and 2.8 million in 1997 - the year Steve Jobs pulled the plug on authorized clones.

The term beleaguered was widely applied to Apple, and prior to Steve Jobs' return at the end of 1986, the big question was whether Apple would close its doors or be bought out by Sony or IBM or Sun Microsystems or Oracle or Motorola.

Instead of that happening, Apple made a $400 million gamble on NeXT, bringing Steve Jobs back to the company he helped found, and the rest is history. Jobs eliminated unprofitable products, streamlined the Macintosh product line, slowly growing Mac sales and turning the company from quarterly losses to profits.

The big change is that Jobs turned the focus from market share and competitive pricing to building a superior user experience, even if that cost a bit more. And that's what kept Apple alive, selling product at the highest margin in the PC industry and totally dominating the market for computers priced at $1,000 and higher.

If RIM is going to survive without being acquired, it needs to follow Apple's example and go back to creating the best possible experience for its users. No more outages. No more smartphones that don't work like they expect. Do not eliminate the keyboard for touchscreen - keep it going on at least one or two models. No more following the market, but learning to lead it again.

Can new RIM CEO Thorsten Heins pull it off? Is he any kind of visionary at all? Or will he watch helplessly as RIM become the next tech failure?

With its history and installed base, there's no reason RIM has to disappear, but some poor decisions and poor communication coupled with customer panic could easily sink the company.

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Dan Knight has been using Macs since 1986, sold Macs for several years, supported them for many more years, and has been publishing Low End Mac since April 1997. If you find Dan's articles helpful, please consider making a donation to his tip jar.

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