We’ve all lost at something before. Sports, love, business – whatever it may be, we’ve each lost something somewhere throughout our lives. It’s not like we didn’t see it coming – there are warning signs all around us and I think our rational side knows the end is near, that the loss is happening. Our emotional side, however, holds a grudge, hangs on too long, ignores the rational and prolongs the pain. We’ve all drunk-dialed our ex’s or feigned success when we know it not to be true. We simply can’t let go. We can’t move on.
As hard as it is to say, it must be said. RIM has lost this game.
The numbers (PDF) speak for themselves: 52% declines in sales quarter over quarter, a quarterly loss of over $500 million, 7000 layoffs – bringing the total to almost half the entire company gone in one year. Staggaring. But as staggering as that may be, the impact this inglorious fall has had on the value of their brand may be more troubling. According to BrandZ’s annual report (PDF) on the most valuable brands on the planet, RIM’s brand value fell 75% in the last 12 months alone, with no sign of improvement.
These days it is easy to dump on RIM and proclaim it dead as everyone else seems to have done – with joy I might add. Whatever its fate may be, the lessons to be learned from RIM’s plight are many and should not be ignored. The largest of these lessons seems to be in what RIM didn’t do while its competition was emerging – RIM simply stopped innovating and started reacting, they stopped pioneering and offered incremental improvements based upon past success. This happens. As whurley so duly noted at UNTETHER.talks in late June, technology is a cycle and companies ride those cycles – up and down. RIM’s competitors – be they Google, Samsung or Microsoft – have responded to the changes in the market place brought on by Apple, instead of reacting. That is the difference. Case in point: QNX.
A failure to respond
BB10, built on the QNX platform, was to be the future of the company. The basis of this new OS has been in the hands of RIM since its acquisition of QNX in April 2010. That is OVER two years and three years after the first iPhone hit the market (and punched everyone in the gut, repeatedly). It will not arrive until 2013.
The inability to move to a QNX-based platform in what could be three years makes me think RIM has missed its chance. Not because the technology isn’t good. Not because what RIM is trying to achieve is strategically flawed. It’s because RIM has squandered its window to transition its technology without destroying brand loyalty. RIM is taking its lumps long after Google, and Microsoft, and Samsung took theirs.
Microsoft provides the best counterpoint to RIM. It takes time to transition technology, to make it right. Microsoft realized this almost three years ago. It looked at the iPhone, looked at its platform, looked back at the iPhone, looked back at its platform and realized what it had could never compete. Perhaps Microsoft realized it could spend the next 10 years running on a treadmill, following Apple’s lead and still never catch up to its competitors – let alone surpass them. Microsoft admitted defeat, went into hiatus, and reinvented its future without baggage (Nokia might disagree about the baggage part, ed.). If, like RIM, Microsoft continued to react rather than choosing to respond, it would be less relevant today across all brands, not just mobile. Now, Microsoft has a (mostly) unified platform across mobile, tablets, and desktops, and licensing agreements with an army of hardware manufacturers.
Compare this to RIM’s last three years: see the success of the iPad and announce a tablet solution in October of 2010, long before it is ready, on a platform incompatible with BlackBerry smartphones currently in development; delay the release of BlackBerry 7 smartphones to dedicate resources to PlayBook development; release the PlayBook six months after initial announcement without core functionality like email; release delayed BlackBerry 7 smartphones four months later in August of 2011; announce new QNX-based mobile platform two months after BlackBerry 7 launch, which will be incompatible with BlackBerry 7 and all other in-market BlackBerry devices; fail to release a QNX-based BlackBerry within a year of announcement, with revised launch time 18 months after last device launch.
Which company would you rather be?
Launch BB10 or save the company – they aren’t the same thing
Timing is everything in business and does the timing for BB10 – early 2013 – make a difference? Is RIM just on the same treadmill it has been on since the smartphone market got competitive? Like that kid that sprints the first 100 meters of a long-distance race but can’t finish, RIM is playing catchup in a race that it can’t win. It is putting so much emphasis on a new platform that won’t have an impact on its bottom line for at least another year. Based on what we are seeing in the industry, will this BB10 be relevant or even wanted a year from now? Is RIM building for today, slightly passed today or 1-2 years down the road? Does RIM know the answer to that question?
There comes a time for reassessment and that time is upon RIM. RIM’s goal needs to be to save the company first – this is an obligation. These decisions will determine the final outcome of a once venerable Canadian bastion of innovation. Whatever RIM does, the path it is on is one that leads to obliteration. The company simply cannot continue “holding on for BB10”. It needs to take a stand, make a statement, innovate in the gut. It needs to get off the path it is meandering down because the cliff is approaching. We see it. The vultures see it.
It’s time for RIM to change. The industry has.
Edited with additional reporting by Douglas Soltys.