Why I Think RIM Will Succeed… The QNX Powered Comeback (very good QNX analysis artile)

by BBA Brian on September 12th, 2011

        The last 12 months for RIM and the Blackberry brand have been HELL.  I trace the free fall back to the day the Torch 9800 was released just over 1 year ago.  I call that wake up day. That is the day for me that started RIM on the path that it currently finds itself in, with stock prices in the toilet, media/public perception being eroded and the RIM faithful having their loyalty tested.  It’s when the critics and bloggers really started to RIP into RIM.  It is the day the public, including fans, started to grow inpatient with RIM.

        We all know what happened since, the buggy OS 6 launch, the lackluster 9780 update… the Style… the Playbook without BBM/Email/Calendar, the delayed OS 7 launch etc etc… finishing off with where we are today, with the latest batch of OS 7 phones being on the market for a couple weeks.  Today we find RIM is in the middle of a rebuild, yet, the analysts keep calling out that RIM is dying and many blog sites keep perpetuating these stories, furthering the problem of RIM’s image reconstruction.

       There is no denying RIM deserved the criticism it got and needed the wake up call, but, I feel that wake up call has been heard and that the valid criticism and analysis has turned into rampant miss information and creative reporting by people who don’t understand the future plans of RIM and how RIM is making the transition for the future.   I feel we are past the point of reflecting on why RIM got to this position, it has been beat to death, and it is clear RIM has already started to turn things around.

       That is now why I write this piece.  I write this piece because… I feel…. things are different now since the OS 7 releases.   I feel that RIM is literally half way through turning the corner.  I feel that the majority of analysts either do not fully understand the mobile landscape as it stands today, are operating on months old information or have up to date information but don’t understand it.  I also feel that there are some out there that know what RIM has in store, know the potential RIM has; however, they want to short the stock price and keep it down in an effort to make money for themselves or those they associate with.

       What set me over the top and inspired me to write this opinion piece was the numerous articles that referenced Mr. Misek’s analysis of all things RIM that came out a couple days ago.  It was such a brutal and out of touch analysis of RIM’s situation.  It made Mr. Misek seem like he hadn’t read any of the new news about RIM over the last 4-6 weeks.  The fact that it got so much play all over the internet bothered me.  Mr. Misek’s analysis got so many thoughts running through my head that I felt compelled to write this piece… and what I want to write about is

WHY I THINK RIM WILL SUCCEED

       This is purely my own opinion and it 100% relies on RIM delivering a solid QNX phone, the Colt as it’s called today.  Given a solid Colt……. this is why I feel RIM will RISE.

OS 7 phones were not expected to make record sales

• The main thing that critics are harping on these days with respect to RIM is the relatively moderate sales of OS 7 phones.  This is something that bugs me.  No one should have expected the OS 7 launch to set record sales, or get every iPhone/Android user to switch to Blackberry. The OS 7 launch should have had two goals: stop the bleeding of users switching away from Blackberry to iPhone/Android and keep RIM relevant in the consumer market.
• As far as I can see, based on my observations, the OS 7 launch has achieved that goal.  Blackberry users are, by and large, choosing to upgrade to OS 7 phones, thus staying with Blackberry and the majority of positive reviews, especially around the 9900/9930 has given Blackberry a brief injection of coolness that it so desperately needs.  The OS 7 launch needed to keep Blackberry relevant, and, in the minds of consumers so far, it did that more than any other launch in Blackberry history.
• Critics who don’t understand the OS 7 launch goal, will look at the OS 7 launch as a slight failure and this is just plain wrong
• The OS 7 launch has given Blackberry the extension of life it needs to take it to the Colt launch in early 2012

RIM has a loyal following in Canada, Europe and 3rd World countries

• The haters like to discount the fact that RIM is still going very strong in Canada, South America, Europe and Asia.  They only look at the USA and then magically extrapolate to the rest of the world.  This is wrong and misguided

• The critics like to use the example that the rest of the world will eventually move away from RIM, just like the USA has begun to, because they will realize Blackberries are too far behind the competition.  Given the upcoming Colt this assumption is wrong and this is how I break it down:

• • Today a guy in India/Pakistan/Vietnam (somewhere in Asia) is rocking a 9700 or 9300 (even an 8520 or 9000).  The critics like to make us think that in 2012 when he goes to get his new phone upgrade… he will see the current line up of Blackberries and decide they are too far behind the Android or iPhone offerings available to him and he will decide to switch to Android/iPhone…… THIS IS WRONG.  Why do I say this?  Well, because next year there will be a QNX phone that will rival the competition!   Critics like to think that somehow new Blackberry offerings like the Colt will not be available to the foreign markets, that old models like the 9700/9300/9800 will be the only models available in these markets and that the only high end offering available will be Android/iPhone offerings and that’s plain wrong.  The Colt and other QNX offerings will be available!   Whether this is by RIM design or just RIM luck, second/third world countries will not be ready to buy high end products, like iPhone/Android offerings, until after RIM has their high end QNX phones on the market.   Thus, I conclude, that when these second/third world countries are able to purchase these phones and upgrade to the standards of phones used in North America, they will quite possible (and likely) stay with Blackberry, with whom they have lived with and have been happy with for so many years.  To suggest otherwise is without merit and goes against all current second/third world trends up to now
  • The critics like to think that RIM won’t ever make a device that rivals or even leads the competition.  The Colt brings that hope and brings into doubt these complaints by critics

• In addition to having a strong following overseas, one cannot discount the rabid and loyal following in Canada.

• • While us Canadians are limited by our small population when compared to the USA or overseas, we do support Blackberry more than anyone else and that is not going to stop anytime soon
  • The major carriers continue to push Blackberry and Blackberry continues to dominate the advertising landscape in Canada.  One only has to look to the current sponsorship of the Toronto Blue Jays and Rogers Sportsnet ( ESPNish for Canada)…. guess who….Blackberry.
  • Canadians are no where near turning on RIM and are out buying OS 7 phones based on my observations.  There is a huge buzz about the 9900 in Ontario for sure!!  This rabid following is not going away anytime soon and when the Colt hits, it will be devoured by the Canadian masses.

RIM still carries cache, tarnished cache, but still cache

• Critics like to bring up numbers of how many users have left the Blackberry brand to go to Android/iPhone and these same critics like to assume that these users will NEVER come back to Blackberry.   I think they are wrong
• I think they are wrong because Blackberry still, despite the last 12 months, has a lot of cache, identity, prestige, track record and reputation.  I think many people who left Blackberry, actually enjoyed the Blackberry experience and even miss certain aspects of Blackberry (email, keyboard, BBM etc.) but wanted a more robust app catalogue and media capabilities and are trying out the competition.  It is my opinion that many of these users are overall unhappy with the trade off of losing the benefits of the Blackberry OS while moving to iPhone/Android and would gladly come back to Blackberry if Blackberry is able to offer a quality, high end QNX phone that gives them all the media/app content as iPhone/Android has.  Since the Colt will hopefully have the android catalogue on launch and be able to deliver native apps easily, this shouldn’t be a problem.  The rumoured additions of a front facing camera and BBM Video chat are also features that caused people to leave Blackberry for the competition.
• I think this is especially the case with users that have switched to Android.  I have been of the opinion for a while that Android and Android users have no tech identity beyond a very small rabid tech programming geek community.  The average  Android user doesn’t identify with the Android Platform nor does the Android Platform identify with the average user.  I think Android users are the ones that are most likely to switch back to Blackberry.  Android carries NO cache, no history, no track record and no loyalty in its users
• In summary, while Blackberry won’t be able to get everyone who left to switch back, I do feel they have a good chance to get a solid percentage to come back into the fold and become Blackberry users again

Android development will skip a beat

• This is my personal opinion and as the days and weeks go by, my thoughts are being more and more confirmed.  Android development will slow in the next 12-24 months.
• Ice Cream Sandwich, ICS, will hit in the coming months, and, we generally know that it will not be anything revolutionary, just incremental.  Beyond ICS, we don’t really know what’s coming.  With all the lawsuits and problems Android is having and given that they need to start running a hardware company all of a sudden, it is very much up in the air how much resources will go into Android going forward. Since the rumor mill is usually 12-16 months ahead of release dates, I am going to go out on a limb and say that Android 5.0 won’t hit the masses until mid 2013 to late 2013.
• This means that the QNX OS will have significant time to establish itself and compete with the Android OS before Android 5.0 comes out with any significant upgrades.  Given this, one could extrapolate that the QNX OS has the opportunity to leap ahead of Android with updates in late 2012, early 2013

RIM has a vision for implementing services outside the superphone/tablet space that no one else has

• There has been a trickle of information coming out RIM campus, specifically involved in the integration of Blackberry products outside the superphone/tablet space.  The primary spot of development is in relation to in-car computer systems.
• QNX has a long standing relationship with car manufacturers and have the track record and relationships that no other top mobile tech company has.  Cars companies are approaching a period where they want to be technology leaders and not technology followers.  Having integrated medic and car systems with access points in multiple locations in the car is the goal.  QNX is uniquely capable of this.
• Given the 10’s of millions of cars sold EVERY YEAR, this is a huge market that I feel Blackberry is very close to getting involved in.  Imagine every new BMW or Mercedes with an integrated Blackberry QNX system.  When you seriously take a step back and realize how HUGE this market is, its really exciting.  When you think of the millions of cars that could have Blackberry QNX systems in it… it is staggering, it really is amazing no mobile tech company has gotten into the industry yet.
• Whoever is first to this race will likely be the winner and really, the two main players would be Apple and RIM.  Android is in no way remotely stable enough to get into this business and Microsoft’s OS is way too new and unpopular to enter the space.  If RIM can get into this segment of the industry first, they have a strong chance of being the dominant force in the industry.  QNX gives them that head start that Apple doesn’t have

RIM just revamped the team

• Critics like to still write articles that RIM is behind the times, stubborn in their ways, old ideas, stale ideas etc etc, this simply is not true.  There have been several high ranking changes in leadership in the last 60 days and several more slightly lower ranking changes .  With additional moves likely to come in the next 2-4 months, RIM is on its way to having a whole new talent pool in senior positions so critics claiming RIM is stale, are just off base.

The above 6 points lay the foundation to allow RIM to make their comeback; however, lots of hard work and execution needs to happen with the QNX phone launch to capitalize on these foundations.    There are some key areas they need to execute on:

1. The Colt needs to hit in 1st quarter 2012
2. The Colt needs to have high end specs in every area.  That includes:
   • Dual core
   • HD screen
   • 8 MP camera (with autofocus lol)
   • 1 GB of RAM or more
3. The advertising campaign has to be aggressive and new
   • With the Colt, RIM needs a brand new image, and with that comes a new advertising campaign.  Already we have seen the news that RIM is looking for a new ad company to run this campaign.  The Colt advertising campaign is where they need to invest the billions of dollars they have sitting in the bank.
4. The Colt must come with a robust app catalogue.
   • With the the Android App Player and a more developed QNX OS app catalogue, this is very likely to happen
5. The Colt’s design and UI need to differ from past design, yet, be unique Blackberry
   • I am still of the opinion that the Colt should be a mini Playbook with all its textures and angles.  The majority of people feel the Playbook is the best designed tablet on the market, RIM needs to capitalize on that.  I feel the swipe UI of the Playbook needs to somehow be transferred to the Colt as it is a major plus and would set it apart from all other phones, just like the Playbook swipes set it apart from all other tablets.  We know ICS and iOS 5 will not have swipes of this nature, so the window is open

In summary, I believe the combination of the above 5 factors in RIM’s favour and the execution on the above 5 areas will lead RIM into the future and beyond.

There are a great many people out there who have switched to Android/iPhone and want to come back to Blackberry, they just need a good reason, and the Colt has the potential to be that good reason. When putting things in perspective, RIM still has a huge fan base in North America and abroad.  This will not go away in the next 12 months, thus giving RIM its window to complete its turnaround.

The critics forget that the public, especially the American public, are very fickle consumers.  While it may not be in fashion now to support Blackberry, with a solid QNX Colt, it can still go back to being in fashion, just as it was before.  In the end it all comes down to execution.  RIM has a window of opportunity here that they are lucky to have:  Steve Jobs stepping down at Apple, HP shutting down webOS, Android under siege with lawsuits, this is the time for RIM to bust through with the Colt and take back the industry.

I for one will continue to anxiously await the next leaks of the Colt and all the new products put out by RIM.  I have faith that RIM understands its mistakes and is turning things around.  The next 12 months should be interesting!