Bye Bye BlackBerry. How Long Will Apple Last?

Just five years ago, “BlackBerry” was virtually synonymous with “smartphones.” It was well on its way to becoming a generic trademark, like Kleenex or Band-Aid, that would seemingly forever be associated with its entire sector. “For many, the Blackberry is a must-have gadget, a wireless hand-held computer that can send e-mail and make phone calls,” noted a 2005 NPR story on the “CrackBerry,” as some BlackBerry addicts referred to the device. (Incidentally, the story compared the BlackBerry to the Palm Treo, an equally popular device at the time.)

 

Today, however, Research In Motion Ltd. (RIM), the maker of BlackBerry smartphones, is a financial basket case that has come to symbolize just how turbulent life in the modern digital economy can be. On Thursday, RIM announced that it was laying off top execs as revenues continued to plummet and the firm’s stock price hit its lowest mark since 2003. Industry analysts are lowering their projections for the firm and wondering if any corporate suitor—Microsoft is commonly mentioned—might be willing to step in and save the day by taking over the company.

 

As a New York Times headline from earlier this year noted, “The BlackBerry [is] Trying to Avoid the Hall of Fallen Giants,” joining the infamous ranks of the Sony Walkman, the Palm Pilot, the Atari 2600 gaming console, and the Polaroid instant camera. The article noted that “Over the last year, RIM’s share price has plunged 75 percent. The company once commanded more than half of the American smartphone market. Today it has 10 percent.” Both metrics continue their downhill slide.

 

If RIM can’t pull a rabbit out of the hat, the BlackBerry will become the latest case study exemplifying just how fast “information empires” can rise and fall in today’s rapidly evolving information technology marketplace. I’ve devoted numerous installments of this column to documenting how Joseph Schumpeter’s “perennial gales of creative destruction” are blowing harder than ever in today’s tech economy and laying waste to those who don’t innovate fast enough.

 

Nowhere is that more true than in the mobile phone handset and operating system marketplace, which has undergone continuous change over the past 15 years and is still evolving rapidly. Like the BlackBerry, Palm smartphones were also wildly popular for a brief time and brought many innovations to the marketplace, but the company underwent many ownership and management changes and rapidly faded from the scene. After buying Palm in 2010, HP announced it would use its webOS platform in a variety of new products. That effort failed, however, and HP instead announced it would transition webOS to an open source software development mode.

 

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Microsoft also had a huge lead in licensing its Windows Mobile OS to high-end smartphone handset makers until Apple and Android disrupted its business. It’s hard to believe now, but just a few years ago the idea of Apple or Google being serious contenders in the smartphone business was greeted with derision, even scorn.

 

Read the full article: Forbes.com