Blackberry squished: former industry leader will no longer make mobiles

29 Sep 2016

BlackBerry will no longer make mobile devices. Image: Got Video/Shutterstock

The once dominant smartphone maker BlackBerry says it will no longer design and produce smartphones.

The very first phone most people ever held that could be deemed in any way “smart” was a BlackBerry. Yes, Nokia ruled the roost for the first few years of the 21st century, but it was BlackBerry and its clever email messaging technology that made us mobile workers in the early days.

Sadly, after 17 years of making mobile devices, BlackBerry is conceding defeat to Apple, Samsung and the plethora of Asian smartphone makers who now rule the market.

‘The company plans to end all internal hardware development and will outsource that function to partners’

Future Human

BlackBerry CEO John Chen officially brought the curtains down with the announcement that the company will no longer be involved in hardware.

“Our new Mobility Solutions strategy is showing signs of momentum, including our first major device software licensing agreement with a telecom joint venture in Indonesia,” Chen said.

“Under this strategy, we are focusing on software development, including security and applications. The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,” he said, ending a pivotal era in an understated fashion.

BlackBerry kickstarted the mobile revolution in 1999, first with smart pagers and its BlackBerry Messenger service, before moving onto phones in 2003.

A broken connection: the steady demise of BlackBerry

BlackBerry’s advance was unprecedented and its devices were ubiquitous throughout the business world, threatening the then mobile leader Nokia.

By 2007 BlackBerry, or Research in Motion (RIM) as it was known then, was at the zenith of its power.

Devices like the BlackBerry Pearl were selling well. Nokia was an annoying, ever-present, but playful foe, and operators all over the world were selling BlackBerry devices like hot cakes to security-conscious executives.

Not only that, but fickle youth were warming to its BBM messaging platform.

It looked like plain sailing.

And then in June 2007, everything changed.

At the Apple Worldwide Developers Conference (WWDC), the late Steve Jobs unveiled a predictable array of Apple Mac products before a baying crowd of adoring Apple fanboys.

Close to the end of his keynote, he intoned the immortal words: “oh, one more thing …”

Out of his pocket, he produced the first iPhone, and the mobile world was transformed forever. Apple did what BlackBerry and Nokia never thought of doing: it created a mobile device designed to be easy for consumers to use. It caught like wildfire and within a year, the App Store transformed how most people consume software.

Microsoft’s CEO Steve Ballmer scoffed at the iPhone’s one button, while RIM’s co-CEO Jim Balsillie labelled it as a mere entrant to an already crowded space. Nokia also arrogantly dismissed the iPhone as a threat, responding with shiny touch screen devices but unwieldy software.

Today, only Microsoft remains of the iPhone’s detractors. Microsoft has pretty much abandoned its own mobile ambitions after its failed acquisition of Nokia cost it billions of dollars in losses.

But Google, being no slouch in 2007, refocused its efforts on a “mobile first” strategy and doubled down on a company called Android Inc, which it bought in 2005. It also cleverly facilitated the founding of the Open Handset Alliance for open standards with smartphone development.

For BlackBerry, the writing was on the wall but it didn’t read the signs.

The company brought out its first touchscreen device, the BlackBerry Storm, in 2008 as a half-hearted retaliation.

Unfortunately, it was a Storm in a teacup as critics gave it mixed reviews, highlighting its clumsy haptic feedback and variety of bugs.

In 2013, BlackBerry smartened up and revealed a new generation of devices including the Z10 and the Q10 with their own app store.

The gamble failed and by August of that year, BlackBerry agreed to be acquired by equity player Fairfax Financial for 2013.

The signal of the demise of BlackBerry’s hardware ambitions was eerily similar to that of Nokia.

While the end of Nokia came in the abandonment of its own proprietary operating systems for the Windows Phone, the demise of BlackBerry could be seen in the meek, lacklustre way it brought out the BlackBerry Priv in 2015, a device that ran on Android 6.0 Marshmallow.

If there is a lesson to be learned from the collapse of BlackBerry and Nokia, one that players like Google and Apple also need to be mindful of, it’s this: you can never be too big to fail.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years