What’s really wrong with BlackBerry, and a parallel?

A fascinating blog post by Michael Mace expounding on where issues lie at Research in Motion (RIM, the manufacturer of Blackberry devices):

Business Week has joined a large and distinguished group of experts taking jabs at RIM. Morgan Stanley recently downgraded RIM’s stock, saying it’s going to lose share faster than previously expected (link). Gartner reported that Android had passed BlackBerry to become the most popular smartphone OS in the US (link). And CNET said RIM is about to be kicked out of the enterprise market (link).

I’ve been getting very tired of the criticisms of RIM, because most of them seem superficial and some are petty. Yes, Android is doing well, but neither RIM nor Apple is giving away its operating system, so it was close to inevitable that Android would eventually get the unit lead. It’s the default choice for most smartphone companies, so of course it moves a lot of units in aggregate. But there is room in the market for several mobile platforms to succeed. The companies Android is hurting most are Microsoft, Access, and others that were hoping to sell mobile operating systems.

The author makes some great points throughout and has some impressive charts showing how RIM is in decline.  Well worth reading the whole article – this section seems to sum up RIM’s issue very clearly:

This one’s a little disquieting as well. Five years ago, RIM was getting .7 new subscribers for every BlackBerry sold. In other words, most of its sales were to new users. Today, RIM is getting .37 more subscribers per BlackBerry sold, and that figure is at an all-time low. To put it another way, RIM now has to sell more than two and a half devices to get one more subscriber. Either RIM is selling most of its units to its installed base, or it is having to bring in a lot of new customers to replace those who are leaving for other devices. My guess is it’s a mix of both.

However, a few paragraphs jumped out at me for an altogether different reason:

Yes, RIM’s not good at sexy marketing, but it has always been that way. People have been predicting its imminent doom for as long as I can remember (do you recall when Microsoft Exchange was supposed to destroy it?). My guess is that the folks at RIM are shaking their heads at all of the bad press and assuming it will once again blow over in a quarter or two.


In my opinion, RIM’s real problems center around two big issues: its market is saturating, and it seems to have lost the ability to create great products.


To keep a platform viable, you need to focus on two tasks: Keep the customer base loyal, and add adjacent product categories.

and finally:

On the other hand, if these customers and developers drift away, there’s virtually no way you can grow something else fast enough to offset their loss. The trick here is that the supporter base for a computing platform is like a herd of cattle. They move as a group. When the herd is contented, it tends to stay in one place. But if the herd gets restless, even a small disturbance can cause a stampede in which they all run away at once.

Sound familiar?

Poor marketing, saturated market and customers/developers drifting away.

So what does Michael think RIM should do?  Well you’ll have to read his post to get that, but his closing paragraphs again chime with me…

As the founders of the company, Jim Balsillie and Mike Lazaridis could probably pull this off without losing their jobs. And I know they have the courage to make big changes. But I doubt they can see the need, or especially the urgency. Their current processes and business practices got them to $15 billion in revenue; why should they change now? It’s much more prudent to focus on making the numbers for next quarter.

That’s probably just what RIM will do. And if it does, that’s why the company will probably eventually fail.

BES Express

RIM formally announces free BlackBerry Enterprise Server Express Software for IBM Lotus Domino

Volker hinted that this news was coming a couple of weeks ago, but I’m very pleased to note that RIM has now made it official:

BES ExpressResearch In Motion announced today BlackBerry Enterprise Server Express for IBM Lotus Domino – free server software that wirelessly synchronizes email, calendar, contacts, notes and tasks between BlackBerry smartphones and IBM Lotus Domino without compromising security. The software is available today at www.blackberry.com/besexpress.

BlackBerry Enterprise Server Express uses the same robust security architecture of the market-leading, premium BlackBerry Enterprise Server, and includes more than 75 of the over 500 smartphone controls and IT security policies available with the premium version of BlackBerry Enterprise Server software. It supports BlackBerry smartphones on business data plans as well as most personal data plans*.

“BlackBerry Enterprise Server Express is a free download that is designed for businesses of all sizes. It provides an easy way for businesses to get started using BlackBerry smartphones with IBM Lotus Domino and it’s also an ideal no-cost software solution for businesses that want to allow their employees to connect their personal BlackBerry smartphones to their work email,” said Jeff McDowell, Senior Vice President, Enterprise and Platform Marketing at Research In Motion.

“There’s tremendous growth in work force mobility, from small businesses through to major corporations, and there is clear evidence that shows how smartphones can increase organizational responsiveness, improve productivity and help employees make the most of their time,” said Ed Brill, Director, Messaging and Collaboration, IBM Software Group. “BlackBerry Enterprise Server Express is a great opportunity for businesses to cost-effectively extend Lotus Domino to more employees on BlackBerry smartphones.”

This solution fills a major hole in the RIM product line, and is essential if RIM want to maintain their share of the Lotus Domino market – Traveler has been putting some serious pressure on them over the past year or so.  Having said that, its also massive for IBM – this will be a significant reduction in the cost of a Blackberry-enabled Domino environment for SMBs.  Great news all round!

However, there are some limitations you should be aware of:

BlackBerry Enterprise Server Express works with Domino Enterprise Server and Domino Messaging Server. It can support multiple Lotus Domino domain environments from a single Web-based administration interface and can be run in parallel with the premium BlackBerry Enterprise Server software for the same instance of IBM Lotus Domino.

The premium version of BlackBerry Enterprise Server for IBM Lotus Domino provides more extensive mobile device management capabilities, over 500 smartphone controls and IT security policies for more granular control, and is required for add-on solutions such as BlackBerry Mobile Voice System, Chalk Pushcast Software, the BlackBerry Clients for IBM Lotus Sametime, Lotus Connections, and Lotus Quickr, and other enterprise-grade systems. The premium BlackBerry Enterprise Server is ideal for managing company-issued BlackBerry smartphones, whereas the free BlackBerry Enterprise Server Express is an ideal option for securely connecting employee-owned BlackBerry smartphones to the corporate network without adding software licensing costs to the company.

Seems reasonable to me, but may catch some out.  More info on RIM’s site.