15 years back BlackBerry was considered one of the most popular Smartphone devices. At its peak and at the very initial stage of Smartphones, Blackberry was adopted by many as a premium Smartphone Device, the way Apple devices are treated today. During that peak time, BlackBerry owned 50% of the US Smartphone industry and 20% of the Global Smartphone industry. It has even sold 50 Million devices in only one single year. But sadly despite its popularity in the beginning phase, BlackBerry failed to hold its popularity. Currently, it holds 0% of the global Smartphone industry. So how did this happen and what was the reason behind the failure of BlackBerry?
History of BlackBerry
BlackBerry was established back in 1984. At its beginning stage, it only produced pagers and modems. But it wasn’t until the year 2000 when it first launched a phone. The name of the phone was BlackBerry 957, which came with features of sending push emails and surfing the internet. During those years BlackBerry was considered a premium brand by business executives and anyone who valued data privacy and security. BlackBerry did not have any competition until the year 2007 when Apple launched its own smartphone and in 2008 when Google launched Android. But even then nobody thought blackBerry was capable of failing the way it did. In fact, back in even 2010, BlackBerry held 40% US Market and 20% of the Global Market.
Factors for the Failure of BlackBerry
The first reason was the Slow Market Reaction. After Apple launched its first touchscreen device, BlackBerry was reluctant to even entertain the idea of a touchscreen device. However, when BlackBerry executives saw that the market had a positive outlook for the Touchscreen phones, they immediately launched their own Touchscreen phone (BlackBerry Storm). However, they didn’t completely believe in the prediction that consumers will start to prefer a complete touchscreen device compared to one with a key-board.
As a result, they kept on launching phones with a keyboard even when Apple was transforming the smartphone industry with their full touchscreen phones, and they launched phones which had both a touchscreen and a keyboard. ( BlackBerry Blod) This clearly exhibits BlackBerry’s slow market reaction and insight into where the smartphone industry was headed.
The second factor was focusing on the wrong end market. BlackBerry valued its enterprise-level consumers, and honestly, it was the only consumer base it had. BlackBerry was built on the concept of providing internet access, data privacy and tight security to corporate clients. BlackBerry was making most of its money from them. So it kept its focus on that specific market-tier.
On the other hand, Apple and Android were trying to bring Smartphones to households. They had the idea of producing smartphones that anyone can afford. BlackBerry failed to recognize that these household consumers will become the most important one for any smartphone company trying to survive in the market.
The last factor was misunderstanding the smartphone’s value proposition. BlackBerry was against the concept of open source development of mobile apps. In fact, BlackBerry was against the idea of Apps. BlackBerry insisted on security, they failed to recognize that the Smartphone was slowly going to become a source of entertainment and full customization.