Blackberry running out of juice?

June 18, 2009 by
Filed under: Technology 

Blackberry 957

Research in Motion, responsible for those of us “thumb-typing” all day long and undoubtedly king of the smart phone market announced quarterly results today. Impressive!! They beat analyst estimates again. Yet, the stock traded at some point after hours almost 10% below yesterday’s close (it has then recovered all but the last 2% or so). Is the Blackberry is running out of juice (I hate puns!) at last?

People buy things because of the things these things do (whaaat?). Applications are what sell devices, not the devices themselves. Sure a sexier iPhone will sell better than an ugly one but first and foremost you have to want to do what the iPhone does before you consider it.

Blackberries mobilized email. An applications that had been relegated to a computer and involved carving out time of your day to actually do it. RIM leveraged their know-how in two-way paging technologies to create email “push” technology that allowed devices on a cellular network to receive email in real time. They had perfected the thumb qwerty keyboard in the RIM- 950 (leapfrog) so they had a great input UI. They added a screen and a great scrolling interface. Lastly (and the most important component) they created the Blackberry Enterprise Server (BES) that made email “push” technology seamlessly integrate to Microsoft’s Outlook and voila, by April 2000, mobile email was born. In other words, they created the perfect combination of device, infrastructure, and services for the application at hand. Over the past 9 years they’ve managed to dominate the smart phone market by essentially bringing mobile email to more and more people from the corner office to around the corner soccer moms and hockey dads. Sure, you see some people running SAP interfaces, Syclo apps, Salesforce.com, and a bunch of other business apps on them, but they are really, really very good for email only and most importantly email is what lures people into buying them. Are there more people that need to mobilize email? Not really and they now have too many options to chose from. That may be the reason why Wall Street did not get excited about another blowout quarter by RIMM. They have to clearly prove a new application base in order to grow significantly.

Similarly Apple had found an amazing way to sell and distribute digital music that made everybody win: consumers, record labels, and mostly, well, Apple. When they introduced the iPhone they leveraged that, added telephony (which was no big deal anymore) and found a great way to mobilize the internet. A real browser with an awesome user interface made it really useful on the go. But forgive my heretic comment, but iPhone, 3G, and 3GS are reminiscent of the PC speeds of the 90’s and the RAZR, KRZR, ROKR sequence: essentially the same thing with an minimal evolutionary advance.

Palm is now trying to combine both email and browsing but, like I pointed out in a prior post, it is just dividing the pie further (if they are lucky) not really growing the pie or creating new pies.

In other words we need a new mobile application that will create new categories of devices and grow the market. Think about it, we started with simple telephony, we added PIM (Personal Information Managers), text messaging, media, pictures, videos, games, email, location (gps), internet browsing, books and magazines, and there may be a couple more. But the list really stops there. It is all about things that are tethered today and need to be mobilized so we can do them any time and anywhere without having to dedicate special time to them. Or things that we keep in one place and we want to take with us everywhere we go.

The app store phenomena with various degrees of success is, in my opinion an attempt to find other things to do with your device as a secondary functions. Good idea, don’t get me wrong, but if wireless carriers, device manufacturers, OS suppliers, etc. all have an app store, few are making money, and more importantly few app developers are making money too it is hardly what you would consider a market changing catalyst the way the Palm Pilot, StarTack (now I’m aging myself here), BlackBerry, or iPhone have been.

There are several possibilities here: Either someone finds something else to mobilize which I find difficult to believe at least on a massive scale (the PC industry has not found a lot of new things to automate on a fixed basis that will later need to be mobilized) or we approach this in a totally different way. The fact of the matter is that your Blackberry, iPhone, MotoSurf, Palm-pre, pro, pra, or pri are a commodity.

The point is that although there may be some innovation coming up to a device near you it is only evolutionary. It may be in the form of a sexier phone with more features. But to really be a catalyst for change the networks need to build out bandwidth and capacity. Network addressable storage has to come to a consumer simplicity, and innovation has to come in the form of services and data delivery. Why? well …. that’s a topic for another discussion.

By the way, make sure you start digitizing your entire life in preparation for it. Remember whatever you own that displaces water it is not portable. If it is stored in binary format it is.

Enjoy.

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