Research In Motion at a Cross Roads

Once upon a time there was a behemoth in the smartphone industry.  Research In Motion (RIM) and the Blackberry set the standard that all other devices and services were measured against.  In recent time, however, RIM’s market share has declined to a level that has made the blackberry nearly irrelevant to financial markets.  Recently, RIM reported its first loss in corporate history, which was surprising in that it was their first since the iPhone was released, and all indications point to a divestiture of RIM’s assets consisting of its Patents, Hardware, Software and their greatest holding, the immense private network used to interconnect every Blackberry device across 90 countries securely and reliably.  Unless they can shift their business model to and be accepted by a consumer market, the outlook appears inevitable.

How could a technology leader fall so quickly, in such a short time span?  The simple response is that RIM created their demise with their own technology and a lack of understanding the consumer.  With the initial deployment of the Blackberry product, centralized administration of technology was a building trend among IT personnel.  The Blackberry Exchange Server allowed for a single point of control with fine granularity from all users or to an individual device.   The ability to secure communications added to the interest in the Blackberry platform.  System administrators slept well at night knowing that their devices, and the data on them, were secure. 

Unfortunately, this focus on the administration of the device, while the key factor in its adoption, is the root cause of the failing long term sustainability of the platform.  By focusing on the Enterprise, RIM forsook the “consumerization” of their target demographic and the rise of the Bring Your Own Device (BYOD) movement.  They believed endorsements by the Government and large corporate dominance would sustain RIM through that pesky flash-in-the-pan, the iPhone.  Now, the iPhone is the new standard all other devices are compared and Android devices, while not considered equal to the iPhone’s capability depending on who you talk to, are taking over market share, the Blackberry is a distant third in market.  The Blackberry has become the Oldsmobile of the smartphone industry. 

The single saving grace that RIM has had in its steady decline has been its private network.  This is the infrastructure by which all Blackberry devices are connected and provides the secure connectivity capabilities that RIM has touted over other devices’ use of ActiveSync.  Several consumer groups in Europe and Asia have kept the Blackberry alive due to the Blackberry Network.  Each Blackberry has a PIN identifier.  Knowing the PIN for a particular individual allows a Blackberry user, utilizing Blackberry Messenger (BBM), to send SMS type messages that are extremely secure and  for free. On top of that, you can group participants in BBM, which creates a powerful communications tool as observed during a London riot last year. 

Now Microsoft has entered the ring after several mediocre attempts.  Windows Phone has matured to a competitive level and, along with its Metro platform tying into Windows 8 and truly linking the mobile and desktop experience, there is debate on the ability of Windows Phone being a realistic challenger to iPhone and android as the standard.  Additionally, Microsoft has announced that their new Windows Phone 8 devices will include Trusted Platform Modules (TPM).  The TPM is a hardware component that is the DNA of a device.  It takes all of the components of the whole device and creates a Hash value or checksum that represents it.  Should someone make a change to the hardware or break the integrity of the system, the Hash value would change and easily be identified as compromised.  Using TPM, an organization can securely link its devices together with confidence.  Also, this takes the human factor out of the security aspect of platform administration.  Instead of the user entering their user-name and password, which is regularly simple to guess or get through with brute force, the TPM is registered with the data center and the user credentials are a second keyset in a two-factor authentication.  This additional hardware component will mimic the ability of Blackberry to encrypt the device, ensure secure connectivity to services and establish secured data links across the open internet.   The significance here is the merging of secure hardware with network encryption and a platform that consumers will adopt.  Could this be the last nail for RIM?

Make no mistake; RIM has revolutionized mobile access technology.  The technology has driven productivity and advanced business capabilities beyond the desktop.  Without the Blackberry, some would say there would be no iPhone, iPad, Android, or what comes next.  The world has moved on from the centralized archetype from 15 years ago.  Perhaps, the Blackberry will find new life in Blackberry 10.  Until that proves true, Apple, Google and Microsoft will continue to widen the gap through a clear understanding of the consumer market and allowing the consumers to drive the BYOD movement.