The creators of the Blackberry were sure that customers loved the keyboard. That’s what they heard all day from their users, and it must have been right since they had a huge share of the mobile phone market.
When the iPhone came out, it wasn’t seen as a threat because it had no keyboard. Blackberry was in the keyboard business, the iPhone sold something else.
We make this mistake more often than we imagine, and it’s worth looking at.
RIM, the makers of the Blackberry, didn’t actually sell keyboards. They sold the network. It’s easy to see this if you realize that a single Blackberry (with no one to connect to) was worthless, but an iPhone with millions of users and no keyboard is priceless.
Within three years, RIM went from dominating the market and reaping huge profits to essentially zero market share.
Instead of defending the keyboard, they could have defended the network.
They thought they made little boxes with batteries, but they actually made a network and gave their IT customers a story.
The heart of their customer base was business people, using business funds to pay for a business device. They wanted connection, success, and security. Freedom from fear dances with affiliation and status all day.
RIM could have offered IT departments exactly what they wanted–the chance to tell their bosses that they had control. Deniability. Security. The ability to monitor traffic and retain (or delete) information.
- Encrypted transit
- Server-side authentication and revocation
- Audit logs of who accessed what when
- Compliance documentation for regulators
By defending the network, they would have made it difficult for any of these users to eagerly switch to a different network, one that their peers weren’t on.
Instead of selling devices, RIM could have sold seats. At $45 a month (bring your own device), it would have been a bargain.
The hardware process was a sunk cost, a warehouse full of liability that felt like an asset.
We get hooked on our past wins (and our fears of past losses) instead of understanding the value we’re able to provide.
A Blackberry iPhone app would compete with their own devices in a way where RIM couldn’t lose. Feed the network first. Give people what they actually wanted (connection and status) not what said they wanted (a faster way to type).
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