[FoRK] Anatomy of failure: Mobile flops from RIM, Microsoft, and Nokia

Stephen Williams sdw at lig.net
Mon Apr 25 13:46:37 PDT 2011

Disagree?  What is going to sway the market?  Where are the surprises?

> Research in Motion's BlackBerry PlayBook is so bad 
> <http://www.infoworld.com/d/mobile-technology/rim-blackberry-playbook-unfinished-unusable-534> that Verizon Wireless may not 
> bother carrying it -- a spokesperson said so the day after the PlayBook debuted to customers. AT&T won't let BlackBerry users 
> download the essential app <http://www.infoworld.com/d/mobile-technology/why-att-undercutting-the-rim-playbook-363> (BlackBerry 
> Bridge) that brings email and communications apps to the PlayBook. Carriers are arms dealers, selling weapons to anyone for a 
> price, but even they are drawing the line at the PlayBook.
> That's a huge fall given that the PlayBook's creator, RIM, is the successful patriarch of the mobile market -- inventing the 
> smartphone category, in fact. And RIM is not alone.
> Like RIM, after lots and lots of promises leveraging its Windows savvy and market strength, Microsoft produced its own disastrous 
> mobile platform, Windows Phone 7 <http://www.infoworld.com/d/mobilize/windows-phone-7-why-its-disaster-microsoft-912>. It's not as 
> bad as the PlayBook, and if you really want one, a carrier will sell you a unit. Dell too jumped on the Android bandwagon and 
> produced a series of awful tablets, after a failed foray into making its own smartphone. (Remember the Axim 
> <http://www.infoworld.com/d/hardware/dell-folds-axim-may-be-eyeing-palm-purchase-506>?)
> Why are such established technology powerhouses failing so spectacularly in mobile? How can they not see the self-destruction in 
> their approaches? For RIM and Nokia, the failings threaten their medium-term existence. For Microsoft and Dell, the failings 
> prevent them from growing where the market is moving.
> There are several reasons, and one of them is not Apple. Sure, Apple worked its design magic on first the smartphone and then the 
> tablet, bringing to market the same zeal, elegance, consistency, and ecosystem advantages that have made the Mac the only PC with 
> a growing market share <http://www.macrumors.com/2011/01/13/apple-boosts-market-share-in-slumping-u-s-pc-market/>. But Apple had 
> done that with the original Mac, yet was still beaten by others. The fact that Apple's mobile products are truly the best 
> <http://www.infoworld.com/mobile-calculator> doesn't explain why the competitors' products are generally so bad.
> The answers have to do with an essential flaw found in most companies: They can't easily change gears because doing so means 
> dropping the focus on what has worked and brings in the money now for an unproven, untested, risky shift. Clayton Christensen 
> captured and described this phenomenon wonderfully in "The Innovator's Dilemma 
> <http://www.amazon.com/gp/product/0060521996/ref=as_li_qf_sp_asin_tl?ie=UTF8&tag=ergo-20&linkCode=as2&camp=217145&creative=399353&creativeASIN=0060521996>," 
> an often-cited business book most businesspeople don't seem to actually follow.
> When Apple introduced the iPhone in 2007, it seemed to be a left-field change for the Mac maker, a bet that it could enter and 
> succeed in an alien market. That wager paid off, with Apple now the highest-valued public technology company in the world. But in 
> 1999 or whenever CEO Steve Jobs decided to shift from being a PC maker into a consumer device maker (2001's iPod was the result, 
> which led Apple to the iPhone and now the iPad), that proposition had very long odds. At the time, Apple was in critical 
> condition, so the company had the freedom to take its chances.
> RIM, Nokia, Microsoft, and Dell haven't been desperate enough to truly think different. When the iPhone came out, they all 
> pooh-poohed it as a toy that would at best appeal to Mac loyalists. (Never mind the example of the iPod.) Today, iPads already 
> outsell Macs 4 to 3 and iPhones outsell Macs 5 to 1 -- that shows why mobile is so important to computer vendors. In addition, 
> iPads are credited with torpedoing the netbook market and shrinking the PC market.
> *Why RIM, Nokia, and Microsoft blew themselves up
> *RIM particularly played up its cozy relationship with security- and control-minded CIOs who would never let such toys into the 
> enterprise. Nokia and Microsoft had the same paternalistic, insular point of view. (Dell's story is more like that of the OEMs -- 
> I'll get to that shortly.)
> They were talking to the wrong people. CIOs and IT managers are generally conservative, risk-averse, and traditionalist -- 
> especially at large companies and even moreso at regulated ones. In their worldview, change is bad, and so is user freedom. These 
> Neanderthal IT leaders are a lagging indicator of what's really going on. They dismissed the PC, the Internet, and e-commerce, 
> too. But betting on them -- and the large checks they kept writing -- let RIM, Nokia, and Microsoft blindly traipse into irrelevance.

> RIM is most egregious in this denial: Its executives, from the two CEOs down to product managers, keep saying publicly that apps 
> are a fad, the iPhone is a fad, bring-your-own-device and consumerization trends are fads -- that the world will wake up from its 
> madness and re-embrace the BlackBerry as it was. I've also heard stories of RIM managers saying they can always retreat to Latin 
> America, a RIM stronghold that somehow is immune from the changes in mobile technology. If you don't believe in the future, you 
> can't move into it, much less succeed in it. RIM believes one thing and goes through the motions of another. The result is 
> unsatisfying to everyone. To be fair, I've heard through the grapevine that there are people within RIM really do see the new 
> world and want to succeed in it -- no company is a monolith, but for now, those with their heads in the sand are prevailing.
> Although these vendors have all brought in outsiders and even bought companies with modern technology, their leadership and their 
> staffs remain immersed in the old way. Breaking out of that box is not easy even for creative, "imagineering" people, and 
> executing outside that box is even harder. It's impossible if you don't honestly try.
> That's why most companies don't survive fundamental transitions such as the one we're going through now 
> <http://www.infoworld.com/t/mobile/2011-the-year-personal-computing-will-reinvent-itself-967>. The PC killed off Digital 
> Equipment, Silicon Graphics, and dozens of other midframe and workstation companies; only IBM and Hewlett-Packard made the shift. 
> IBM wisely sold off its PC business to Lenovo just before the PC market got too commoditized, which is why Dell is in trouble and 
> HP is looking beyond today's Windows PC. E-commerce killed off scores of retailers, such as bookstores. The Internet has been 
> killing off large segments of the music, video, and publishing industries.
> It's a rare company that can pull off the vision, execution, and timing to thrive in such transition. Apple did it, aided by its 
> desperate circumstances and a peculiar culture that honored and encouraged out-of-the-box thinking. The time for RIM, Microsoft, 
> and Nokia to make a real bet on mobile would have been in 2007 (as Google knew and did), when Apple showed the way but before it 
> set the standard -- not in 2010 and 2011, when Apple has defined the direction and Google has sopped up the rest of the market.
> That's why any company depending on RIM, Microsoft, or Nokia mobile technology should be working fast and furiously on an exit 
> strategy. Already, large companies are finding it hard to hire young people when a BlackBerry is the only option. I've met several 
> CIOs who've allowed iPhones and iPads in for that very reason, only to find that it was no big risk after all 
> <http://www.infoworld.com/d/mobile-technology/forget-the-fear-learning-love-ipads-and-androids-work-809>.
> Websites, cloud services, e-commerce, and games are all clustering on iOS and Android, and the best mobile business apps are also 
> on those platforms. This coalescence threatens to orphan businesses that are based on the "legacy" mobile technologies such as 
> BlackBerry (in North America), Symbian (in Europe), and Windows Mobile (in government).

> *It really is down to Apple, Google, and maybe the WebOS wild card
> *Still, it's possible that Motorola could pull an Apple and be the comeback darling we all celebrate four or five years from now. 
> HP could also be in that position. It's realized that making generic PCs is a dead-end business, as would making generic 
> smartphones. Instead, it bought Palm for its WebOS and now plans to bring WebOS to smartphones, tablets, and PCs 
> <http://www.infoworld.com/t/webos/hp-jumps-webos-lifeboat-sinking-windows-ship-043>, in a bold move to unify the three types of 
> computing devices. It's the kind of move that Microsoft could and probably should have tried. It'll be a stretch for HP, and what 
> HP showed recently for the forthcoming WebOS didn't inspire me 
> <http://www.infoworld.com/d/mobilize/hp-touchpad-and-pre-new-products-not-new-ideas-960>, but at least it's taking a run at 
> breaking from the past.
> Apple is clearly going to be the idea and profit powerhouse in mobile, even if Google has more market share. Google, which seems 
> to be realizing its fully open model could hurt Android 
> <http://www.infoworld.com/d/mobile-technology/googles-tighter-control-over-android-good-thing-845>, could also be more of a 
> driving force if it figures out how to lead an alliance of strong OEMs (such as Motorola and perhaps Samsung and/or HTC) rather 
> than let the OEMs damage its brand with their "slap it together" mentality. HP may have a shot of being the third engine.
> The rest are history. RIM, Microsoft, Nokia, and Dell are all toast in the mobile market -- the walking dead who should be looking 
> for burial plots. Mourn them if you must, but it's time to move on. Don't get buried along with them.


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