BlackBerry Ottawa

BlackBerry Ltd (NASDAQ:BBRY)’s former executives like Mike Lazaridis and Jim Balsillie, have mostly been quiet since they left the company. But in a new book detailing the rise and fall of BlackBerry, the two shared their views. They talked to The Globe and Mail reporters Jacquie McNish and Sean Silcoff.

A book detailing the rise and spectacular fall of BlackBerry will be published this week in the U.S. In the book, former BlackBerry executives broke their long silence and shared their views of the company in its heydays and how poor execution almost took the company out of business.

It was Apple Inc. (NASDAQ:AAPL) with its iPhone that nearly wrote BlackBerry’s obituary. The reason Apple achieved perhaps more than it hoped for was because the guys at BlackBerry dismissed iPhone as a device dead on arrival.

The iPhone disruption

According to Mike Lazaridis and Jim Balsillie, BlackBerry somehow blundered by dismissing the iPhone at a time when organizations like Google Inc (NASDAQ:GOOGL) quickly realized that things had changed and adjusted to the new reality. BlackBerry didn’t have a near-term strategy to counter the iPhone.

One of the major issues disclosed by the former BlackBerry executives is how they felt that the iPhone couldn’t go anywhere because its design could not be sustained by the carrier networks. BlackBerry was loved by carriers for its handsets that work optimally with their networks. However, little did they know that high consumer demand would push carriers to upgrade their networks and such a move would favor the iPhone.

Verizon pressure

Since the iPhone was first being offered exclusively through AT&T Inc. (NYSE:T), Verizon Communications Inc. (NYSE:VZ) pressured BlackBerry to come up with a handset to counter the iPhone. BlackBerry developed the BlackBerry Storm, which was hurriedly done and missed the point by a significant margin, becoming a disaster for the company in the end.

When the Storm failed, Verizon demand $500 million in compensation from BBRY to cover the losses. BlackBerry objected but later paid more than $100 million to Verizon to cover various damages.
With the iPhone, Apple not only succeeded in shrinking the fortunes of rivals like BlackBerry Ltd (NASDAQ:BBRY), but has also been able to dilute the influence of carriers. That can be seen in the way smartphone users spend a lot of money on apps and other content than the carrier bill.

The shaken BlackBerry

The BlackBerry Ltd (NASDAQ:BBRY) that has been left to John Chen to steer is a company that is still struggling to stabilize revenue. As much as Chen seems to be doing things the right way, it will take quite some time before the company can rely on new revenue from software to offset the impact from the hardware market.

Source: bits.blogs.nytimes.com

7 COMMENTS

  1. Wow, you really are smoking the Crackberry aren’t you?

    With Apple getting higher margins every year, and having sold almost 75 million last quarter alone (a record), their phones are not a “wash business”.

  2. yes, even the tense switches from current to past regularly. It’s old news and and the work Chan has done has in fact made Blackberry profitable ($28 Million last quarter), so that said, Blackberry is back in business and offers some outstanding options now with its BB10 OS that allow it full access to Android apps (Amazon and Google). However, although Blackberry now has the most number of apps for its OS, it does not have the means to monetize those apps. Good thing apps are not its key source of revenue as it is with Apple. Hardware devices are a wash business. Apple knows this along with all the others: Samsung, Sony, Motorola, Nokia, Windows, etc. All of these companies have seen a consistent squeeze of margin on hardware and have struggled to find their margins in other channels. Blackberry on the other hand, has had this domain dialed in for the last few years (MDM and Security). The future is bright for Blackberry, and a great time to watch Apple for a short or better yet, a LBO takeover with $80B plus in untaxed liquidity off-shore as they continue to screw USA tax payers royally. Something honest companies like Blackberry have never done.

  3. You’re welcome, not my website, but I have sent them email before and they did request that I send them feedback whenever possible…so I’m kind of helping them!

    I have to say that you have good eyes, I read it quickly and did not notice the quite word 🙂

  4. I was thinking that “have mostly been quite since they left the company.”, should read “quiet”. I thought I saw another further along, but can’t find it now. Sorry.
    Thanks for your concern about your content and for your prompt response. It’s a good sign!

  5. Can you ‘please’ have someone proofread these stories before publishing? The poor grammar and spelling detracts from the impression of quality of the publisher.

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