RIM To Refocus On Enterprise?

One if the items that appeared today in the RIM earnings call is RIM’s desire to refocus on the enterprise market. Apparently, they have decided that the consumer space isn’t really open to them, and they have realized that without content, BlackBerry will continue to struggle. Apparently they didn’t get the memo about consumerization of IT.

Lines Between Enterprise and Consumer Blurred

Some companies have started to a move toward letting employees use their personal devices for corporate purposes. It has come about, in part, because people no longer want to carry both a corporate device and their personal device. While smartphones are still a small minority of mobile devices, their use and presence in increasing, and people have started to integrate them into their daily routines. Having to keep a second, corporate-owned smartphone around becomes awkward, cumbersome and annoying. More and more people don’t want to have to do it.

The result is an increase in the number of personal devices that are used for both work and personal purposes. This “consumerization”, where employees basically bring their own technology, appears likely to increase over the next few years. The result: if you want to be in the enterprise, you have to have a consumer presence. While there will still be a market for enterprise-only devices (not all companies are prepared to deal with a variety of devices for support and maintenance), that portion of the market may be shrinking over time. If you want to be part of the enterprise, your access to the company may no longer be through the CTO or CIO. It is through the employees walking into BestBuy, the Apple Store or a carrier store looking to buy a new smartphone, or upgrade their existing one. Instead of selling to thousands of corporations, they have to sell to millions of consumers. It won’t be enough to tick all the right boxes when it comes to security, durability, management and tracking. These are going to be personal devices first, and corporate devices second. That means the same mantra I’ve sounded for the past couple of years: apps and content. Ultimately, it comes down to the ecosystem.

RIM Yearning For The Past While Peering At The Future?

What this sounds like is RIM is hoping that a focus on enterprise/corporate will mean a return to the “good old days” when RIM ruled that space, at least in North America. However, they’ve lost the lead even there. iOS now represents the majority of corporate mobile devices in the United States. Companies haven’t adopted Playbook, and they are starting to drift away from BlackBerry. Part of that is certainly due to consumerization. But part of it is simply because companies have decided they want iPhones instead of BlackBerries.

In the mean time, they are betting a lot on BB10. The issue there is that, even if BB10 is more “advanced” than iOS or Android, the people buying these devices won’t care. BB10 will hit the streets with an app inventory that is substantially smaller than either iOS or Android. It will still have less content. In short, it will still have the same ecosystem problem the current Blackberry has. As RIM’s CEO said, BlackBerry strengths don’t seem to matter anymore. That tells me something about their mindset: while the earnings call and the language used finally shows an acknowledgement that things are bad, it still sounds like there may be blindspots. If the so-called “advantages” don’t matter, they they aren’t advantages anymore.

This still leaves the BlackBerry with a gaping hole when it comes to ecosystem. Now, that may change, depending on how this “licensing” concept materializes within RIM. Does it mean putting key technologies like BBM on iOS and Android? Does it mean offering BB10 on devices from other companies like Samsung and HTC? So far, it isn’t clear exactly what this means, and what attraction it would have to other players in the market.

Enterprise Focus May Be Too Little, Too Late

RIM had put a lot of faith in their dominant position in the North American enterprise market, and the ability to grow the enterprise space globally. It appears, though, that they got complacent and took it for granted. The result is that it has slipped away from them, and with the shift in IT for mobile devices, that change could be irrevocable. The momentum for mobile devices in the enterprise space has started to shift, and that shift is away from BlackBerry. There is little that RIM can offer that isn’t already adequately addressed by iOS and Android. Rather than defending the space, RIM now has to go back and reclaim it, and this time they are up against formidable foes. This isn’t the greenfield (or near greenfield) it was back when smartphones were brand new.

The problem for RIM comes back to ecosystem. The reality is, the BlackBerry ecosystem is thin. Back in 2003, that didn’t matter. The device did more than what was available from most others. Until the iPhone came along, apps for mobile devices was a pretty tiny market, limited largely to the Palm and Windows Mobile space for people determined enough to seek out the apps available. The iPhone and the iTunes App Store changed that, and now apps matter. They matter a lot. And volume is what counts. No one cares that BlackBerry App World contains most of the apps people or companies will “need”. What these purchasers know is that the iTunes App Store and Android Market are likely to contain all the apps they will “want”. Customers want to know the the choices are there, even if all they do is install the mainstream app anyways.

I think that, ultimately, an attempt to refocus on the enterprise is borne more out of wishful thinking than a realistic strategy. It also isn’t exactly a bold plan for rebuilding, and RIM needs bold and rather risky plans to truly remake themselves. Any recovery will be about rebuilding the company, not just refreshing the paint and pictures. The enterprise refocus sounds more like going back to whatever shade of beige they were happy with before. It isn’t visionary, and it likely won’t matter.

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