10 Mistakes That Contributed to BlackBerry's Long Decline
10 Mistakes That Contributed to BlackBerry's Long Decline
Not only is BlackBerry dropping the BlackBerry Classic, but the U.S. Senate is dropping BlackBerry phones. How did BlackBerry, which once dominated the smartphone market, fall so far from grace?
Failing to Recognize the Potential of Consumer Smartphone Market
When it launched its iPhone in 2007, Apple understood something BlackBerry apparently didn't— that consumers would have a big role in shaping the smartphone market. Before the iPhone's advent, consumers were using basic flip phones and high-end smartphone buyers were mainly businesses that handed them out to their employees. But after the iPhone's launch and the rise of Google's Android mobile OS, consumers started driving smartphone sales and handset makers designed their products to suit consumers' demands. After that, those Apple and Android handsets started showing up in large numbers at corporate offices.
Underestimating Apple's Influence
In countless interviews over the years, BlackBerry executives acknowledged that they failed to see how influential Apple would become in the smartphone market. They believed that Apple wasn't a real contender and would ultimately lose its position in the marketplace. The reality, however, was that Apple captured handset buyers' attention, made strong sales deals with mobile carriers and delivered innovative devices that people were willing to pay a premium for.
The BYOD Trend Knocked BlackBerry Out of Business Offices
For years, the corporate world was hearing about the so-called "BYOD," or bring-your-own-device, craze. CIOs, who had picked the hardware employees would use, were now seeing those same employees demand to use their own smartphones for work. The corporate world ultimately relented, and consumer-friendly devices, like the iPhone, Samsung's Galaxy S line and others, all entered the office. BYOD was a boon for Apple and Samsung and tragic for BlackBerry.
Physical Keyboards Just Didn't Make Sense
It took BlackBerry too long to realize that physical keyboards were outdated and unappealing to smartphone users, who quickly got used to touch-screen keyboards. The company defiantly sold products, like the Classic, that featured physical keyboards in the hope that customers would come around and see it as a better tool for communicating. What happened, however, is that the physical keyboards made BlackBerry handsets look and feel outdated. BlackBerry's market share plummeted the longer it stubbornly hung onto the physical keyboard.
Management Shake-Ups Were Difficult
For a long time, co-CEOs Jim Balsillie and Mike Lazaridis were successful mobile company chief executives. But after the bottom fell out of BlackBerry, shareholders lost faith and, in 2012, Thorsten Heins was appointed to the top seat. Heins thought he could turn the company around by focusing on its fundamentals and delivering new hardware and software. He was wrong and ultimately was replaced with a so-called "turnaround expert" in John Chen. Under the leadership of Chen, BlackBerry is trying to become more of an enterprise-focused software company than one driven solely by hardware.
The Long, Slow, Delayed Road to BlackBerry 10
BlackBerry 10 was arguably one of the biggest mobile gaffes in the past decade. The operating system, which was supposed to be the platform that could compete with iOS and Android, was hobbled by countless delays and repeated apologies by BlackBerry. By the time BlackBerry 10 launched in 2013—nearly three years after the company acquired QNX, the firm that built the software—it was too late. BlackBerry 10 was met with largely positive reviews, but the poor press and the rather unappealing Z10 and Q10 devices it ran on were enough to scuttle any chance it had at breakout success.
BlackBerry Lost Its Way in Hardware
In an interview with Fortune last year, BlackBerry's former co-CEO Jim Balsillie admitted that the company made a mistake with the BlackBerry Storm, a device that was supposed to compete with the iPhone but quickly failed. It was the first in a long line of devices that failed to attract customers. In fact, from the BlackBerry Classic to the Q10 to the Z10 and beyond, BlackBerry somehow forgot how to make appealing hardware. And customers turned to other devices because of it.
Don't Ever Forget How Much the Brand Matters
BlackBerry failed to see what its missteps were doing to its brand as consumers and enterprise users stopped believing that BlackBerry could deliver appealing hardware and software. BlackBerry's brand, in other words, couldn't stand up to Apple, Google or Samsung, and it was viewed as second-rate compared with those companies. It was an issue that BlackBerry has yet to overcome.
The Developer Gap Was an Issue
The developer gap was another problem for BlackBerry. While Apple and Google were signing on developers who produced the kinds of apps that grabbed users' attention, BlackBerry was left behind. When the company could finally offer some appealing apps to customers, it was too far behind to catch up. BlackBerry eventually offered users access to Amazon's Android Appstore, but it was too little, too late. Third-party apps are critical to a platform's success, and BlackBerry couldn't keep pace.
Don't Forget About the Ecosystem Effect
One of the main reasons Apple and Google have been so popular in the smartphone market is their ability to keep customers locked into their ecosystems. Apple is especially good at it. The company gets users to sign up for iTunes and iCloud, allows them to synchronize data across devices, lets them share data between apps and more. All of this makes leaving an iOS- or Android-based product difficult. BlackBerry doesn't have that advantage, which added to the company's troubles.