Apple and Google hardware didn’t kill BlackBerry — their app stores did
It was THE status symbol for anyone in the early 2000s, and its physical keyboard made it instantly recognizable, but now the BlackBerry is dead. But it wasn’t the slowdown in the smartphone market or intense competition from Chinese companies which killed the BlackBerry, it was apps.
When Apple released the iPhone in 2007, Microsoft’s then CEO Steve Ballmer famously laughed at its chances. A decade later, Apple dominates and Microsoft is nowhere. But BlackBerry’s announcement on Wednesday that it would not longer be making its own hardware, shows that it too completely missed just how important software, apps and the ecosystem surrounding them would be.
BlackBerry has been making phones for 14 years but just like Nokia, the company failed to spot the significance of the introduction of the iPhone and subsequently Android smartphones from the likes of Samsung which now dominate the market.
For a few years after the introduction of the touchscreen smartphone, BlackBerry continued to grow, but this was down to enterprise customers being tied into its platform and younger users who loved the free BlackBerry Messenger service
But with the growth of apps likes Messenger, WhatsApp and dozens more, BlackBerry was losing its edge. Yes it retained its class-leading security, but as more and more people used their phones at home as well as work, the dearth of software and apps for BlackBerry’s phones soon became a problem.
At the height of its powers, almost a decade ago now, BlackBerry controlled 20 percent of the global mobile phone market, just behind Nokia. Today that figure stands at a fraction of 1 percent. BlackBerry’s most recent attempt to keeps its hardware division alive was the launch of Android-based smartphones, including the Priv, which featured a physical keyboard, long the most recognisable aspect of the BlackBerry phones.
But that was too little too late.
“The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,” John Chen, BlackBerry CEO said in a statement accompanying the company’s latest financial results.
The company’s stock price jumped more than 5 percent when the market opened on Wednesday following the announcement of the news as the company says it will focus on its growing software and services division.
BlackBerry has not said when or if it will release any more devices bearing the iconic name which may be built by third parties, but if they do, they are likely to remain niche players in the market.