RIM CEO On What Went Wrong

AZA43 writes "After releasing some very ugly financial numbers in late June, BlackBerry-maker RIM went on a media blitz to downplay the significance of its latest earnings and counter increasingly negative media attention. ... But a new Q&A with BlackBerry chief Thorsten Heins offers a unique take on what exactly went wrong at RIM — Heins blames the company's downfall [partly] on LTE in the U.S. — and he actually seems genuine in his answers." A peek into the mind of RIM's upper management.

Comments

LTE? How about Android and IPhone

[Terry Pearson]

Just thinking that Android had to put up with LTE and it did just fine. Maybe Blackberry's problem is user interface, tight control of apps, and now a crowded market with better products.

Re:LTE? How about Android and IPhone

[noh8rz5]

The problem is BYOD - bring your own device. people would rather use their own gear than RIM. Actually, the real problem is that consumer electronics have been growing leaps and bounds, and business electronics have been stuck in the past. It used to be that businesses could afford the real stuff, while consumers got the cheeps. Now, my computer at home is faster and more pleasing to use than my POS at work. RIM fell into the "POS at work" category. People's eyes were opened by the iPhone, and they began to have a higher standard.

Re:LTE? How about Android and IPhone

[h4rr4r]

On both iOS and Android the telephony and normal OS are quite seperated. It has nothing to do with open or closed source, just that they treat it as yet another device like the touch screen or the camera. I am not sure how BBOS handles it, but to not do it that way would be stupid.

Even ICS needs closed source drivers for GSM/CDMA radios and often wifi. Hardware companies as always are a huge PITA. The big news with ICS is that all Nexus devices save for Sprints Galaxy Nexus are supported via closed source but publicly available drivers for this kind of hardware. The Nexus S 4G(sprint) and the Verizon branded Galaxy Nexus were the two just recently added back into the AOSP fold.

Re:LTE? How about Android and IPhone

[Anonymous Coward]

It shows how clueless they actually are. LTE has nothing to do with it. The problem was after the iPhone the phone became a "computer in your pocket" and RIM still had "Email in your pocket" - which suddenly looks a lot less compelling.

RIM can't just do "something like an iPhone" that isn't going to wash. They need something radically new, clearly communication needs to be at its core (what were they thinking with the Playbook v1 - no email?!) Probably they need something with a keyboard (though how do you make THAT exciting?) as so many of their customers want that. They need excellence in industrial design. Personally I think they need the "blinky light" that shows you have a message. They need a far better UI (using the current Blackberry UI is an exercise in irritation). Most of all, "covering the bases" isn't enough, they need a "killer app" - being "competitive" can't save them, they have no momentum.

And they need integration with a mobile device (like an iPad or Ultrabook - Blackberry users are keen on those keyboards).

Can they do it? Hmm... seems vanishingly unlikely.

Re:LTE? How about Android and IPhone

[JohnnyBGod]

Do you think he doesn't know that? This is politics. So you're the CEO of a company. Are you really going to come out to your shareholders and say "We're in the shit 'cause our competitors have done better? We'll one-up up them now! Promise!" Of course not! This raises nasty questions like "Well, why didn't you do better before it was a problem?" or "Oh yeah? And how are you going to do that?", questions which either aren't productive or can't be answered without showing your cards to your competition. No... instead, you make up some silly excuse that sounds plausible to anyone who isn't in the know.

Re:LTE? How about Android and IPhone

[bondsbw]

RIM needs to give up on the OS.

Due to the traditional enterprise focus of Microsoft, I personally think it would be in RIM and Microsoft's favor to join forces by releasing a few good WP8-powered Blackberrys.

Re:LTE? How about Android and IPhone

[h4rr4r]

I am not sure the blind leading the blind is the best method for RIM to survive. If WP7/8 actually sold a large number of devices it might be worth it. Instead they need to support ActiveSync on their own devices and offer their software/services on non-BB devices as well.

Re:LTE? How about Android and IPhone

[jbolden]

Give up on the OS? RIM has the only real time kernel on the market. Everyone else is using a server kernel adjusted for the desktop and then readjusted for the phone. The OS is one of their few remaining strengths.

Re:LTE? How about Android and IPhone

[Anne Thwacks]

The difference is, if you don't believe Ballmer, he can throw a chair at you.

Re:LTE? How about Android and IPhone

[ArhcAngel]

RIM's immediate problem is BlackBerry faithful holding out for BB 10 devices. Up until this last quarter RIM hadn't had a sizable reduction in sales. Their stock has taken a beating because they hadn't grown at the same pace as the smartphone market leading to sensationalist headlines decrying their impending doom because they were losing market share. While technically true it is like saying the baker on the corner is going bankrupt because 500 people moved into the neighborhood and the baker is still selling the 100 cakes a week he had for the last decade while 2 other bakers opened up shop and are selling 200 cakes a week each. The iPhone opened the smart phone market up to a new demographic. RIM was created to serve a completely different demographic and their culture has struggled to reach the new market. That market has started to erode their core market so they are indeed in dire straights if they don't do a course correction and they are well aware of that. They are doing what needs to be done just slower than the market would like. There are a lot of factors that will determine if RIM remains relevant but to count them out would be foolish at this point. Did you bet against Apple in the 90's? I bet you did...

Re:LTE? How about Android and IPhone

[jbolden]

I was talking about QNX. Real time helps them because it makes the system much more responsive. Phones because of weak CPUs, network interference and limited memory often have noticeable lags. A real time kernel allows the phone to always be responsive to the end user while handling those tasks effectively.. It also allows for vastly more sophisticated power management which can result in much longer battery life.

And you are right desktop OSes don't use them. All the desktop OSes since the days of OS9 have been designed for servers. Which means they focus on throughput not responsiveness, and then adjusted for the desktop to some extent.

Re:LTE? How about Android and IPhone

[TXG1112]

I was mostly happy with my BlackBerry Bold, but the real issue for me wasn't apps, it was the shitty web browser and small screen. The killer app for smart phones is the Web. If they managed to get that to work seamlessly, they would have kept their customer base and app developers. What did them in was that the Torch was a buggy piece of crap. The UI for email and contacts and all the other communication functions is already superior to the the iPhone.

Re:LTE? How about Android and IPhone

[h4rr4r]

That is not exactly what a Real time OS does. Given not enough CPU to handle all the tasks it abandons any that take too long. Users really don't like those sorts of things. Real Time operating systems are really only good for that environment, where late means worthless.

Re:LTE? How about Android and IPhone

[Anonymous Coward]

I can assure you, without a shadow of a doubt, that the API for managing communications over the radios on BlackBerry devices is one of the stupidest things ever created. In particular, it requires the application developer to handle the idiosyncrasies of the hardware/physical layers while communicating over the transport layer.

Need a TCP connection over cell network? Write this set of software. Need a TCP connection over WiFi? Oh, there's a completely different set of APIs for that. Neither Android nor iOS puts developers through those idiotic hoops.

Net result: the software devs at RIM appear to be complete fools.

Re:LTE? How about Android and IPhone

[presidenteloco]

It's probably because IOS and Android+Linux were complete, general OS stacks designed for, you know, computers, whereas RIM s/w was designed to run on low-end electronics like pagers and early cellphones, so is much more limited and specialized, then added to in an adhoc fashion as the hardware got faster and more memory.

What really happened here is that the cellphone got replaced by a portable computer that happens to be able to phone people. RIM and to be fair many others got caught napping when that happened.

Re:LTE? How about Android and IPhone

[SydShamino]

I've said it elsewhere, but what I think is that they need to release an Android phone that has the same back-end security as a BlackBerry. Sure, let users download apps and play with them in user land, but launch a corporate app and its content is locked down and protected. This is what Trusted Computing is for. (I'm not saying I would buy one for myself, but were my company to issue a phone I had to carry, having it act like a standard fully-featured Android phone plus have corporate support would make it better than a regular Android phone for sure.)

Re:LTE? How about Android and IPhone

[jbolden]

You are at 100% CPU and RAM usage. The user tries to do something that needs more CPU. Do you drop the old task, which is no good he needs that done, or the new task which cannot complete in time?

You schedule it this way.

1) The user always has a high degree of responsiveness. The system never lets itself get to 100% CPU and RAM unless the user hasn't been hitting anything for while.
2) The task the user is currently looking at gets priority and all the CPU and RAM it needs
3) Other tasks split up the remaining generally using something like a most recently used bias. Their may be a notification when a large task in the background completes.

RTOS don't magically create more CPU, they may even effectively decrease it, but that's not the point. What they do is make sure the system is always responsive to the user regardless of load. And absolutely things like postponing tasks are key.

Re:LTE? How about Android and IPhone

[jellomizer]

I actually think that is the case.
Blackberry had 2 things going for it.
1. A really good keyboard. I never owned a Blackberry, however I was handed on a after I had an iPhone, and I found that keyboard was really nice to use... Better then other phones with a physical keyboard, or good touch screen keyboard....

2. A secure method of sending emails and other messages.

Now #2 became more of a liability then an asset, because these portable computers that happen to have phone features, supported standard secure ways to transfer data. And you could choose Wi-Fi or your Data Plan. Then what really hurt was the random Outages at RIM that left customers messageless.

For #1 They still have a good keyboard... They started to push phones without it, and failed (Because not getting a keyboard is a step back). And the phones with it, caused you to have less screen real estate making it harder to make mobile sites that work for iPhone and Blackberry. While we loved the keyboard, we found that we read more then what we typed. Having a good keyboard that takes up half your phone, isn't an efficient use of the device.

Apple happened

[oconnorcjo]

I always thought that the palm pilot was a great idea, but if it had phone functionality, it would be perfect. Blackberry never saw this idea too well. When Apple finally figured it out, Blackberry was dead man walking.

Re:Apple happened

[alen]

but come on, everyone knows that business people aren't allowed to enjoy themselves on flights. if the IT goons didn't lock down the phones so that you can't do anything on them the company will fall apart? imagine the horror of the director of something using his phone to download a non-IT approved app like Angry Birds to play while on a business trip? the client will freak and pull the business

if you take the power away from the IT goons to lock everything down what will they do? how will they get their power trip on?

Re:Apple happened

[h4rr4r]

The IT goons as you call us were the ones quite often pushing for the death of RIM.

My and my goon coworkers pushed to have RIM banned from our company. If you have our company buy you a device you can select an iPhone or Android of your desire. If you BYOD same rules apply if you want any support. We aren't total dicks, we just will not do better than best effort. If it a RIM device comes in and does not work out of the box or they have any trouble at all we just suggest they return it for something else.

We have saved tons of time not having to deal with repushing servicebooks, pulling batteries, and restarting the whole BES server. Which is a PITA since it takes out email for all its clients.

Re:Apple happened

[kdogg73]

That link led me to this Dvorak gem, too: http://www.marketwatch.com/story/apple-should-pull-the-plug-on-the-iphone

Re:Apple happened

[Swampash]

Oh yeah, that's one of the all-time great bits of self-ownage.

Tech journalists make bad calls all the time, but few tech writers have made such a blisteringly bad call as seasoned columnist John C. Dvorak, who famously predicted back in 2007 that “Apple should pull the plug on the iPhone [because it is just] going to be another phone in a crowded market.”

D’oh. $150 billion in revenue later, the iPhone is the biggest success Apple has ever had, and revolutionized pretty much every single aspect of the smartphone and even telecom business. That’s quite the missed prediction, even by tech journalist standards.

So what does Dvorak have to say to explain himself? Was it just a brain fart, or what? Five years later, Dvorak has explained why he said the iPhone would be a dud, and his excuse is fascinating: he claims he got it wrong because of a conspiracy against tech journalists like him who were too honest about Apple for their own good.

http://www.networkworld.com/community/blog/wrong-dvorak-blames-getting-screwed-over-apple

Re:Apple happened

[Xest]

Because Compaq (then later on HP) never invented PDAs (this is what they were called before smartphone became the prominent term) with phone capability called the iPaq, nor was this name used even before the iPod. Palm pilots with phone functionality is basically exactly what newer model iPaqs were.

Apple didn't "figure out" this concept, far from it, it was already well established in the marketplace. What Apple did succeed in doing however was to bring it to consumers - RIM, HP, and even Dell's devices were business oriented, and whilst some consumers liked business features enough to embrace these devices as a consumer oriented tool, they were never going to compete with devices that were targetted purely at consumers, rather than business.

It's the same reason that the likes of Netbooks sold hundreds of millions of units and took the market by storm in just a year or two - because to that point, most laptops out there were focussed either towards businesses, or the expensive high end power user like gamers, and again, whilst plenty of people bought laptops, finding value in them as a personal tool regardless, the consumerisation of them as netbooks really made the whole market explode. Tablets are again no different - the iPad was nothing new, tablets had been done in a way similar to the iPad since at least 2002 with Windows XP Tablet Edition's introduction (of course there were precursors to even that, but this is the point at which they became viable in the way they are now), but they were never consumer oriented, and so never really took off.

Re:Apple happened

[Scutter]

but come on, everyone knows that business people aren't allowed to enjoy themselves on flights. if the IT goons didn't lock down the phones so that you can't do anything on them the company will fall apart? imagine the horror of the director of something using his phone to download a non-IT approved app like Angry Birds to play while on a business trip? the client will freak and pull the business

if you take the power away from the IT goons to lock everything down what will they do? how will they get their power trip on?

Have you ever stopped to ask yourself why the "IT goons" lock things down? Do you REALLY think it's a power trip? Are you that much of a child that you believe that to be the case? Or are you just trolling? Have you ever actually just asked to have Angry Birds added to the approved app list, or do you just complain about it like a petulant schoolgirl?

Given that you have a low user ID, I'm going to assume you've been on Slashdot for a long time and therefore are at least somewhat technical. I'm going to give you the benefit of the doubt and assume that you truly are not a moron and that you know that things get locked down for one reason and one reason only: To protect the company from idiot users. If left to their own, users will invariably create huge regulatory compliance issues (which can easily result in fines in the millions of dollars), introduce malware into the network, lose data, the list goes on. IT is responsible for the company data. If you want to take responsibility for that data, then you can decide how to protect it.

Re:Apple happened

[Kozar_The_Malignant]

I would have thought just the opposite. Any doof can set up an active synch device, but it takes truly l33t skillz to keep a BES environment running. When the PHB's Blackberry goes down, Only You can fix it. BES makes you key personnel. Without it, you're just head count. :-)

LTE?

[headhot]

Its not being ready for LTE that kill them, it was the lack of modernizing the user interface and modern phones that killed them.

It's not a phone any more

[david.emery]

It's a pocket computer. -THAT's- the big shift that RIMM missed, and -is still missing-.

Nice summary of what the iPhone changed here: http://daringfireball.net/2012/07/iphone_disruption_five_years_in

Pre-mortem Analysis

[Sponge Bath]

"we missed on some innovation..."
"we weren't ready for it..."
"not being focused on the new, innovative technologies..."

and finally: "I would not say that we failed to innovate."

Instead of phones, RIM is now selling jets

[dingen]

I just read RIM has sold one of their corporate jets in order to stay afloat. That's pretty desperate.

Re:Instead of phones, RIM is now selling jets

[fuzzyfuzzyfungus]

At least they managed to trim a bit of fat from the top, instead of keeping the jet and firing 150 minions as part of a 'strategic realignment'...

Re:Instead of phones, RIM is now selling jets

[Anonymous Coward]

I just read RIM has sold one of their corporate jets [theglobeandmail.com] in order to stay afloat. That's pretty desperate.

Yes.

Clearly, RIM should have kept all the corporate jets and ask for a government bailout, the same way GM & Chrysler did.

RIM would get bonus points if they actually flew on their corporate jets to go and ask for a government bailout, the same way GM & Chrysler did.

Re:Instead of phones, RIM is now selling jets

[ctrl-alt-canc]

In a related news, to keep the company afloat, corporate jets were replaced with hot air balloons.

RIM Ignored the World

[SkydiverFL]

The company was over confident, overly comfortable in the business space, and simply ignored the customer base... both current and potential. While touch screens were popping up all over the place they were still pushing their tiny physical keyboard. While the competition was bumping up processor speeds to up performance RIM simply slapped on a crude semi-touchscreen which was too big and cumbersome for the core of the device. And, they offered virtually NOTHING to the developer market to foster application creation or distribution. And, finally, they simply ignored their own infrastructure multiple times. In short, they were so confident that their position in the business space was so guaranteed that they turned a blind to everything important.

No mention of ActiveSync?

[h4rr4r]

Either this CEO has no idea what he is talking about or does not want to address the elephant in the room. iPhone and Android support of ActiveSync is what did so much damage to RIM. Had BB supported that many people would have stuck with them just to avoid carrying around two devices, one for work one for play.

It also freed IT departments from dealing with restarting the phone, repushing servicebooks restarting the BES server and all the other hassle that went with BES. I know companies that moved to iPhone/Android and either fired or repurposed an full time employee that had been previously dedicated to BES.

RIM Ignored the consumer

[Darkness404]

RIM ignored the generic consumer in favor of selling their products in the business space. At first it worked because no other phone could do well in the business space and back when the only choices were Windows Mobile (the old, slow, unstable Windows Mobile) or BlackBerry many chose BlackBerry even if it wasn't the ideal smartphone, it was better than the competition. Then Apple released the iPhone which was consumer focused, no longer could RIM keep the consumers who just wanted a smartphone because there was a better option. Soon Android started appearing everywhere and iPhones got a whole lot more business friendly. All the while RIM was selling outdated hardware, an outdated UI, next to no developer support, and any time they tried to innovate it was a half-hearted attempt that failed (remember the storm?).

In a nutshell, why is RIM broke? Because no one wants to buy a BlackBerry because an iPhone/Android does the job a whole lot better.

Hmmm

[AdmV0rl0n]

I have to run Blackberry Enterprise Server. Its a complete pain in the ass in terms of support and main. Its years behind, and its clunky, chunky, and we end up going through endless workload and silly upgrade games. The handsets break if users look at them. I have to do warranty on them daily, and BB now quibble over each return, making the whole thing fail.

The handsets themselves - good email platform, crap at everything else. And the world _is_moving off being email platform centric.
Blackberry messenger is a bright point, but that should be broken out and made an application layer across all mobile devices. The same could well be said for the application layer and so on.

Their network is creaking, but is the one serious advantage that they have, but leverage poorly.

The playbook should have been a blackberry in a tablet form. Instead you needed a BB and as PB to get function. = Fail. Do not now how that ever, ever, ever passed QA and system testing.

If I were BB, I would go software only, and build my whole thing as a software/API/Network package, and build on that. Make the software a package available on all main platforms (Android, IOS, Others) and sell on data packages, and data transit using BB networks. And I'd radically overhaul BB enterprise server into something cleaner, better supported and easier to install, manage, run.

If they stay in the handset market, they need a killer phone/tablet BB 10 release, and they need to cut down handsets to one cheap cheerful, and one kickass model (curve/bold) and stop shipping masses of differening handsets, and make the things robust (the current models are not robust, and are inexusably so) And whatever tablet they ship needs to be a full BB.
(For the record, the playbook was so close to being very very good, and was wrecked by a simplistically small, but incredibly important part, that the whol board and playbook team need to have their heads banged together until they realise how stupid that fail was)

Not that anyone at BB listens anymore.

Nuff said.

He's not *that* honest

[Rogerborg]

I'm curious why you decided to take the helm at RIM?

Surely it should be: Money, Al. Huge, heaving, throbbing piles of money, more money than you'll ever see in your entire life, more money than you can possibly imagine.

No matter how much of this festering dinosaur I have to carve off and throw to the dino-wolves, there will still be more than I can eat, and I'm going to gorge myself on its rotting corpse until we're down to the lips and asshole.

^^^ Exactly

[Picass0]

We only just recently turned in our pagers at work ( ! ) Meanwhile I own a Samsung Galaxy 2S (Sprint Epic Touch) which is better than 90% of the phones I see during the day. One concern is proprietary info on personal devices - most phones will play friendly with exchange servers, but companies don't want you to have that stuff on your personal device if you are fired or quit.

I think part of the reason isn't enterprises being "stuck in the past", but they are more cautious when deploying new systems and approving software for use.

The economy is another factor. The machine at your desk is already paid for.

New machines vs. someone salary - it's better to keep your job.

So if LTE is the problem....

[Karlt1]

then how is the worlds most profitable cell phone company selling only 3G phones?

Re:I blame

[MightyMartian]

Better than the first choice. Imagine calling out on your Dirty Sanchez Storm.

Re:^^^ Exactly

[stokessd]

Plus one way pagers are allowed into places that no cell phone would be allowed. like all tech, they have a place

Sheldon

LTE

[phorm]

Maybe not LTE per-se, but faster networks played at part.
When Blackberry was a shining star, most of their core functionality centered around (comparatively) low-bandwidth textual data exchange. Email, BBIM. Sometimes they might pump a bigger chunk of data but overall nothing compared to media-laden webpages and youtube, etc. Apps generally weren't all that huge either.

Then you bring out Apple and Android. Web-browser, music store, media, and apps that can be 20+MB to download (plus a few hundred for "content" at times). If we had been stuck at 2G speeds then the best phone-browser would still have been a fairly irritating experience speed-wise. At 3G browsing is fine, but faster networks have enabled "smart" devices to become media hubs for video-conferencing, tethering, movies and live streaming.

There's a lot more than just "fast networks" at play, but it may have been a contributing factor. That said, it was also a predictable one that RIM should have been prepared for.