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So Long, And Thanks For All The Quantum Research

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dodo

I’d like to be an optimist, like Matt Burns. I really would. Like Research In Motion itself, I was born and raised in Waterloo, Ontario. Like its former co-CEO Mike Lazaridis, I studied electrical engineering at the University of Waterloo. I’ve seen RIM transform my home town over the years, giving it new parks, new buildings, huge bequests for the university, and the Perimeter Institute for Theoretical Physics. I’d love to see it survive its current dire straits and somehow thrive. But I just can’t see it happening.

I guess it’s still just barely possible to maintain optimism. This was the first quarter since their rise that they’ve reported a loss; they can still spin that into a Rocky-esque down-but-not-out narrative, as long as they rearrange a few deck chairs. But as Paul Graham recently pointed out, “revenue is a lagging indicator in the technology business.” Revenue down 25% year-over-year, for a tech company of RIM’s size, in one of the hottest markets in the world? That’s not a setback, that’s a catastrophe.

Realistically, what are their possible futures now?

  1. They mount an Apple-like comeback;
  2. They limp on, maintaining a 5-10% market share;
  3. Somebody buys them, or at least, their crown jewels;
  4. They slowly diminish into distant irrelevance.

Any other options? Not that I can see.

We can write number 1 off immediately. Apple did it! people say. Yes, but that’s the exception that proves the rule. Even if BB10 is to RIM what OS X was to Apple, that won’t be near enough. OS X alone wouldn’t have turned Apple into a winner. Apple transformed itself from doormat to behemoth by creating not one, not two, but three megahit brand-new markets — iPod, iPhone, and iPad. It’s hard to imagine RIM coming up with even one new game-changer. I suppose it’s possible, just, but I sure wouldn’t bet on it.

Limp on with a 5% market share? How? They’re not even the third choice any more; Windows Phone is. Their only bright spots are emerging markets, where cheap Android devices will be eating their breakfast, lunch, and dinner before long, and those businesses so security-conscious that they still see RIM’s private secure network as an advantage rather than a liability.

But secure email, even if it’s the best secure email in the world, just isn’t enough to be competitive these days. You have to be able to do more, and to do it at least as well as the competition. RIM’s most fundamental problem is their technical ineptitude. Remember when they released the PlayBook? I do: my very first TechCrunch post was about its inevitable doom. How sadly right I was. Remember David Pogue’s NYT review?

You read that right. R.I.M. has just shipped a BlackBerry product that cannot do e-mail. It must be skating season in hell. (R.I.M. says that those missing apps will come this summer.)

Note that last line. That review was written in April 2011. When did those “missing apps” finally arrive? That’s right: last month. Let’s not even talk about the ongoing debacle of their third-party apps. How about the BlackBerry Colt, the new BBX – I’m sorry, BB10 – device that was supposed to have launched by now? Oh, that’s right; it was cancelled.

So when will those BB10 devices arrive? In the second half of this year. Maybe. You know, just in time to compete with the iPhone 5 and Galaxy S III. Meanwhile, bring-your-own-device policies grow ever more popular, and Android/iOS enterprise solutions get better and better. Every passing month feels like another nail in RIM’s coffin.

I keep hearing people talk about RIM as if a management change, or a strategy change, might be enough to save the company. But I believe the reason their products are vastly inferior to their competitors, and are regularly crippled by huge schedule delays, is that RIM’s technical braintrust is simply not up to the job of competing with Apple and Google. It’s not a question of direction, or focus; it’s a question of ability. And that’s a predicament no new CEO can solve. “BlackBerry cannot succeed if we try to be … all things to all people,” he says — but their real problem is that they’re well on their way to being nothing to anybody.

So forget about them coming back like Apple. Forget about them maintaining third-choice market share; Microsoft — which knows a thing or two about selling to businesses — is busy elbowing their way into that role while RIM dithers, swoons and languishes. So we’re left with survival option 3, someone buying them. But who? Their patent trove, sure. But their operations? Who wants to splash out billions of dollars to catch this falling knife, especially after HP’s WebOS debacle? Samsung apparently kicked the tires and walked away. Who else? I can’t think of a single name.

Which leaves us only option 4: softly and silently withering away, until they’re small enough for carrion eaters to pick over the bones of the carcass. It’s a damn shame, but it now seems to me inevitable. You had a great run, RIM. Thanks for all your good work back home. Sorry it couldn’t last.

Image credit: Dodo bird, by mwanasimba, on Flickr.

Article source: http://feedproxy.google.com/~r/Techcrunch/~3/yW0tu0a80fw/

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