Op Ed: Technology Perspective on RIM’s Decline

By Dr. Myles Vogel

Research in Motion (RIM) is synonymous with BlackBerry, its wireless solution. RIM is a classic case of a firm believing what was successful in the past will drive them in the future. This, compounded by being a technology company and totally losing sight of the dynamics of the technology S-shaped curve. This curve actually tracks costs and capabilities over time as the technology goes through an embryonic growth, mature and aging evolution with costs decreasing and capabilities increasing. The key thing is to recognize the opportunities and threats that the curve presents. Close view of rivals and the technology as it goes along this curve is critical as rivals explore other technologies. As of this writing, research and analytics firm, IDC, reports RIM’s share has fallen to 6.4%, a market that it has historically owned. All the while, much more innovative and agile firms such as Apple (iOS) and Samsung (GOOG) have 23% and 59% respectively.

BlackberryRIM’s share has steadily decreased because success often breeds complacency and they totally ignored Apple and its iPhone in 2007. The BlackBerry was the icon of Washington, Hollywood, and Wall Street; but now sees its financial picture in decline with risky alternatives. Apple got rid of the buttons, focused on simplicity, and made a screen its focus. RIM appeared to deny that this could happen to them. In this case, Apple’s success has been disruptive and threatens death to RIM.

The issue for RIM is the stock has fallen 93% since a high of June 2008, and their strategy has consisted of three things: desperately focusing on reducing costs, banking on an ill-conceived new BlackBerry and a call to help to the piranhas in investment banking. RIM’s basic strategies are to keep the status quo – hoping the new phones will be successful or that they will find a partner with deep pockets, or sell.

Anyone want a rotten BlackBerry?

See the business perspective on RIM’s decline – view Dr. Emad Rahim’s op-ed post.

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