Stephen Foley: BlackBerry's products will be in high demand – from museum curators
Stephen Foley is a former Associate Business Editor of The Independent, based in New York. He left in August 2012. In a decade at the paper, he covered personal finance, the UK stock market and the pharmaceuticals industry, and had also been the Business section's share tipster. Between arriving with three suitcases in Manhattan in January 2006 and his departure, he witnessed and reported on a great economic boom turning spectacularly to bust. In March 2009, he was named Business and Finance Journalist of the Year at the British Press Awards.
Saturday 31 March 2012
US Outlook Research in Motion even managed to screw up the admission that its business is a screw-up. Ten weeks into the job, chief executive Thorsten Heins had decided to admit what everyone else knows, namely that the company needs a major rethink if the BlackBerry isn't to go the way of Palm and other pioneering tech brands and become a museum piece.
But in promising to refocus the company on what it has historically done best – satisfying corporate customers – Mr Heins managed to give analysts the idea that he was giving up RIM's strategy of designing and marketing trendier phones directly to consumers.
Everyone woke yesterday to an email clarifying his remarks. "Whilst we announced plans to re-focus our efforts on our core strengths, and on our enterprise customer base, we were very explicit that we will continue to build on our strengths to go after targeted consumer segments," says Patrick Spence, who is in charge of RIM's global sales operation.
So that's clear, then? Of course it's not clear. Since there are no good options for BlackBerry, we will just have to put up with this waffle on the way down.
The confusion does illustrate an important point, though. If RIM really does "focus on its strengths", it is effectively deciding to become a very much smaller company. Some corporate customers will continue to want some or all of its historic offering: secure data networking, executive-class handsets and the operating software to support it. But whatever size this niche might be now, it is shrinking alarmingly.
The trendy term is "BYOD", or "bring your own device". Since consumer smartphones can now do everything an employee needs and more, businesses are deciding in droves that they don't need to buy phones for their staff and can install any corporate software on their own devices.
So "focusing on its strengths" suggests a weak future for BlackBerry. Focusing on its weaknesses is also an unlikely path to salvation. For the best part of three years it has tried and failed to capture the public imagination with consumer phones like the Bold and the Torch, and now the tablet Playbook. Yet as we saw in Thursday night's results, RIM is haemorrhaging sales and accumulating warehouses-full of unsold devices.
BlackBerry phones and tablets are not just less desirable in themselves than those from Apple and HTC and the rest, they are also increasingly less functional than their rivals because app developers are concentrating on building services for the iPhone and Android devices.
Nokia abandoned its own operating software and adopted Microsoft's Windows in an attempt to create a third ecosystem of apps to rival Apple and Android. RIM is still wedded to a don't-join-'em-beat-'em strategy and has placed a long-odds bet on a new operating system coming out later in the year, and on app developers adopting it enthusiastically.
Between now and then, it plans to slash the price of its phones, so that it has the greatest number of people possible that it can try to persuade to upgrade. In an ominous sign, the company says it will stop giving sales and profit forecasts to Wall Street. The only thing you can say for sure is that profit margins are going to be trashed this year.
The Great BlackBerry Giveaway starts today. I expect high demand from museum curators. From the rest of us, not so much.
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