John Collins is still a “BlackBerry guy.”
Like many business people thumbing out e-mails to clients and employees, the managing director of NeatFreak Group Inc. prefers the BlackBerry’s keyboard. He just can’t picture himself tapping out all those messages on a glass-touchscreen device like the iPhone.
“I’m not sure the touchscreen is my bailiwick,” he admits lightheartedly.
But as someone who influences his firm’s technology-buying decisions, it is very much Mr. Collins’ bailiwick to understand trends in the wireless market. And he knows that a lot of the people who work for him prefer to use smartphones manufactured by Apple Inc., Samsung Electronics Co. Ltd. and other giants that have clobbered BlackBerry maker Research In Motion Ltd. in the marketplace.
NeatFreak, which makes home-organization products such as laundry baskets and shoe racks, has about 60 employees in Canada. Roughly half of them use BlackBerrys. But the company’s design team in Lyon, France? They’re all on Apple’s iPhones. And Mr. Collins, who sits on several international boards and travels constantly, is also well aware that many of his suppliers and clients allow employees to bring their iPhones and Android devices into the workplace.
As RIM prepares for a crucial moment in its history – to launch its new lineup of BlackBerry 10 smartphones next Wednesday – it will be relying on businesses like Mr. Collins’s company to, quite literally, buy into its comeback story. Corporate and government clients have long been the cornerstone of RIM’s global expansion; they are still the customers most loyal to the BlackBerry, and the most lucrative ones the company has. Analysts estimate that business users number about 20 million people – about one-quarter of RIM’s global subscriber base of 79 million users. But they contribute a bigger percentage of its revenues than that, because they tend to buy higher-end phones and pay fees for enterprise software. “They’re more valuable to RIM – there’s more revenue lines that they contribute to,” says Cormark Securities Inc. analyst Richard Tse.
So while BlackBerry 10 is aimed at a mass audience – RIM is buying Super Bowl airtime to promote it – it is business customers who may well decide whether the phones, and the company that is betting its future on them, succeed. The BlackBerry brand has lost so much of its cachet with consumers, it will take a long time to win them back. But if RIM can persuade a large number of those 20 million business clients to upgrade to BB10, it can at least arrest its downward spiral, build a profitable business around its core customers, kill the perception that the BlackBerry is dead, and buy itself more time.
That is a big if. RIM is launching BlackBerry 10 into an altered reality. Many corporations still rely on RIM, of course, but over the past few years, smartphones have become commoditized, and Western consumers’ preference for iPhones and Android phones has slowly spilled over into the business world. The delays in BB10 caused some businesses to supplement or replace their aging fleet of BlackBerrys with other, non-RIM devices.
Moreover, the line between business users and consumers has blurred. More companies are adopting “bring your own device policies.” This means, instead of buying a BlackBerry for employees, they’ll allow them to get their corporate e-mail on their own personal phones, often sharing the cost. That’s part of a broader trend that chief information officers call the “consumerization of IT,” in which devices, software or trends that are popular among consumers spread to the business world. For CIOs, it means happier and more productive employees if they can use the phone they really want – and it may also lower costs, if workers are buying their own devices.
The stakes for RIM now are much higher than ever. This isn’t just a phone; BlackBerry 10 is an entirely new smartphone platform launching in an era of furious smartphone competition. If it fails and perhaps even if it achieves only mild success, RIM may have to explore the more ominous options in its strategic review, including a sale or break up of the company. For months, RIM’s top brass has been able to defer the hard questions about the company’s future by saying, in essence, “Just wait for BlackBerry 10.” That wait is now over.Report Typo/Error