RIM hitting speed bumps

by www.rim.com/ screenshot

Research in Motion current product line contains Blackberry phones and the Blackberry Playbook. The Blackberry phones have been highly popular in the business market. By offering phones that were easy to sync with corporate networks, and having a physical keyboard, they offered a lot of value to the business world. RIM was also able to get reasonable market share in the consumer space.

But now it seems that more and more current Blackberry users want to switch from the Blackberry platform to either an iPhone or an Android equipped device (54% as of May 2011 in the US). Blackberry’s current market share has fallen to 27% in the US. That is at the same percentage as the iPhone, from which sales have been stable, and below Android with its 29% market share. Sales of Blackberry phones have been dropping from 11 to 6 percent during the first quarter of 2011, and the company’s expectations of future sales do not indicate any recovery soon. Why are people not buying RIM’s products, and are they able to turn their strategy around in both the business- and consumer market?

Over the years both Android and iOS gained functionalities for which made Blackberry popular before. For example, the sync ability with corporate networks over Exchange, or for consumers, the famed Blackberry Messaging service.  Now both iPhone and Android have similar functionalities, and according to many users, have a better user experience.

And that is what it is all about: user experience. The user interface of Blackberry products have not changed much in the past 8 years, while Android and the iPhone are revolutionizing the industry. Even the products that should have been the company’s turnaround are not well received. Their Blackberry Torch, the first phone by Rim with a touchscreen, has been camping with low performance and mediocre touchscreen responsiveness. Also RIM’s first tablet device was not well received by the press because its software was still flawed at launch.

Developers are becoming more and more important in the phone industry. Who wants a phone without the ability to install apps? How many apps do you use on a daily basis? Developers are not excited anymore to develop for the Blackberry platform due to a declining user base and more limitations because of mediocre hardware performance.

It seems RIM’s management is slowly waking up, and realizing things have to change. Especially 2000 employees are going to be laid off in the near future. According to an anonymous letter from a high level employee, the company is only looking at what functionalities their competitors offer, and are too busy implementing those into their products. The thing they are forgetting, again, is how consumers would like to use their products.

Author: chapp