Last month, the company that pioneered the concept of the smartphone unveiled a brand new device featuring a completely different screen size from previous models as the current chief executive made a critical bid to counter the perception that the company could no longer innovate like it once did in its heyday under its inspirational leaders.
But amid all the recent hoopla over the release of the iPhone 6, what with the long lines, record-setting sales and the much-reported bendiness, it was easy to miss the the fact that Blackberry's chief executive John Chen unveiled the Passport, a peculiar-looking device with a distinctive form factor, featuring a square screen and three-row keyboard. This event was seen as a last-ditch bid for survival for a company that has seen its fortunes thoroughly reversed.
How times change. Back when Blackberry was called Research in Motion, it bestrode the smartphone space like a colossus, its keyboard-equipped devices setting the standard for multipurpose pocket computers.
That all changed with the arrival of the original iPhone in 2007 and the subsequent rise of Android, and Blackberry's subsequent fate certainly seems to be a cautionary tale, with former leaders Jim Balsillie and Mike Lazaridis departing in acrimonious circumstances while sales and revenues have maintained a steady downward trajectory, down to less than 1 per cent market share in the last quarter.
All of which has made Blackberry into a classic case study in disruption theory. What were the strategic errors that consigned them to also-ran status? The arrival of the Passport has seen no shortage of analysis on the company’s shortcomings.
Former Apple executive Jean-Louis Gassée pinpointed the part played by the Canadian firm’s failings in the software space: “At a very early stage in the shift to the Smartphone 2.0 era, RIM understood the nature and extent of their problem: BlackBerry’s serviceable but outdated software engine was against a much more capable architecture. The BlackBerry was a generation behind.”
As Gassée points out, the other multitudinous failings - “company culture, hardware misdirections, loss of engineering talent” - all stemmed from being outflanked on the software side.
More than two years ago in this column, I pointed out the parallel decline of both RIM and Nokia: "Both…are being disrupted to death - they both pioneered different areas of the mobile phone business at the high and low end, and both have been usurped by developments that they are neither agile nor technically adept enough to react to."
Last year, however, technology writer Ben Thompson made the point that Nokia and Blackberry's decline wasn't classic disruption: "In 2006, the Nokia 1600 was the top-selling phone in the world, and the BlackBerry Pearl the best-selling smartphone. Both were only a year away from their doom, but that doom was not a cheaper, less-capable product, but in fact the exact opposite: a far more powerful, and fantastically more expensive product called the iPhone. The problem for Nokia and BlackBerry was that their specialties - calling, messaging, and email - were simply apps: one function on a general-purpose computer. A dedicated device that only did calls, or messages, or email, was simply obsolete."
The Passport is gimmicky, no doubt, and numerous reviews have pointed out that the placement of the space bar in the bottom row, between V and B keys, actually makes typing more difficult than previous Blackberrys. In that sense, it brings to mind all those Nokia handsets from the turn of the century that were differentiated only by the zany designs of their number pads, usually at the expense of usability.
Despite the tepid reviews, there were some voices of praise - over at Techpinions, analyst Bob O’Donnell expressed some relatively bullish opinions about Blackberry’s latest device, saying the Passport makes more sense in the flesh than it does in photographs.
“The Passport is not something that an enormous number of people are going to want, but for the right market (mobile professionals who work for companies with strict security policies), it’s actually a pretty cool device,” he wrote.
O’Donnell and other Techpinion analysts emphasised that Blackberry now occupies a niche - those business types who must carry a second device, purely for work-related tasks. Blackberry’s strength in secure communications and business services means it continues to have relevance in this area, and the company even has a name for its target market: “Power Pros”.
“Ultimately, technology products are likely to follow the path of other mass-produced goods, such as cars, appliances and even clothing,” O’Donnell wrote. “In all those markets (and many more), the ability to specifically target different types of consumers and then create products that match the unique needs/interests of those different consumers is what allows companies to thrive.”
I remain unconvinced that creating secondary devices for that minority of people who are high-functioning workaholics is a sustainable strategy in the long-term. Most likely, Chen is striving to maintain some value before offloading the company, perhaps in a sale of parts. But it’s undoubtedly good to see a company try to do something different, try to find a niche and craft devices that are well-suited to its needs. The Passport might not be that device, but the strategy might just be the right one to allow Blackberry to survive in the medium term.
