RIM's BBX has all the logic PlayBook should have had
BBX converges BlackBerry and QNX, and beefs up enterprise features
RIM is a frustrating company right now. The massive outages that affected BlackBerry email users on three continents last week may have been a miracle of bad timing, just after the iPhone launch, but they were only the most publicised of a string of more avoidable mistakes which are leaving users and developers at the end of their tether.
The most serious has been the botched operating system migration strategy – and only now, probably a year too late, has the firm addressed those errors, unveiling a hybrid BlackBerry/HTML5/QNX platform called BBX. This will not catapult RIM into the apps major league with Google and Apple, but it may preserve its core user and developer bases a little longer, perhaps long enough to carve out a new position in the evolving mobile web/cloud world.
That is, however, if RIM executes better on BBX, and the devices which will run it, than it has on QNX. The decisions along the way to a new operating system have been wrong so many times, that faith in the company is dwindling, despite some promising technologies and a very real affection for the BlackBerry service. But RIM has apparently learned nothing from the painful OS transitions of its rivals – Palm's to webOS, Nokia's to open Symbian and now WP7.
Yes, a new platform was needed to update the ageing BlackBerry OS for the world of the cloud, the browser and web apps. QNX was a good candidate and there was logic to keeping RIM's own system rather than following the Android route towards non-differentiation. But moving to a new OS was a huge gamble – QNX was more modern and web-oriented, to be sure, but incompatible with the existing apps base and, on its first product (the PlayBook) not even supporting the famous native email.
Palm had made the same gamble and lost, but RIM had some advantages over its former rival, notably the still-fierce loyalty of much of its business market. So, among several success factors, one was an obvious condition for the migration to succeed – RIM needed to keep its vital enterprise base happy.
This would enable it to introduce the new platform to a friendly audience, with the promise of new delights to keep corporations away from the Apple temptation; having kept its core base largely intact, it could then continue the process it has started, with offerings like BlackBerry Messenger, of building on its old strengths to attract consumer fans.
Instead, it went with a dual-OS strategy, upgrading BlackBerry OS, with all its creakiness, for the most important products, the phones, and showcasing QNX on the PlayBook tablet. This confused the developer base, especially as it became clear that there would be very few bridges between the two OSs. The leap to a new and incompatible platform is always one that requires great developer faith, and the PlayBook certainly did not instil that – it was a beta product rushed to market without RIM's absolute killer app, its native email, still the main reason anyone buys a BlackBerry product (even teenagers are seduced, mainly by the devices' excellent messaging capabilities, dressed up in less corporate clothing).
Having gambled that its customers wouldn't notice that email on a phone is no longer considered cutting edge, RIM has been playing catch-up with other features of the modern mobile web experience. Tablets were supposed to be the its saving grace, but it managed to launch PlayBook without native email – an idea which will probably sit alongside "Hey, let's merge with AOL" as one of the worst corporate decisions of all time. At the same time, many faithful BlackBerry users are increasingly suffering from app envy (Angry Birds anyone?) and more banks and law firms are starting to use rival iPhone and Android-based devices.
BBX debuts for phones and tablets
With this appalling history behind it, BBX can certainly benefit from far lower expectations than those which attended QNX and PlayBook. It plays many of the cards which RIM should have played for QNX, but frustratingly, a year too late and amid significantly deteriorating developer and carrier relations. It addresses the issue of the corporate base far more effectively than RIM did be-fore, preserving a life for legacy BlackBerry apps, supporting native email, and adding new and heavyweight features in key areas such as security and cloud services.
The new hybrid OS combines features of BlackBerry OS and QNX, co-CEO Mike Lazaridis told the BlackBerry developer conference in San Francisco. It will be the foundation of the company's software platforms for the future, along with BlackBerry Cloud Services. Developers will be able to choose RIM's native SDK and open source tools, or HTML5 with RIM's WebWorks, to build apps for BBX.
The company hopes that the move will help address the dearth of applications for QNX, which is due to replace the older OS on smartphones over time. It also puts to rest rumours that the PlayBook, and its standalone QNX system, would be killed off after disappointing sales. RIM hopes confidence in the tablet's future, and native email, will reawaken interest in the product (though confidence in the firm's own future would be helpful too).
However, even BlackBerry OS cannot boast anything like the range of programs of its main rivals – the wider choice for Android and iOS is one factor luring consumers and even RIM's heartland enterprise customers away from the BlackBerry family, whose share of the US smartphone sector fell to 20 per cent in the quarter to August, down from 25 per cent a year before.
RIM had intended to address the apps problem on QNX devices by allowing Android software to run in emulation mode, and that is still part of the strategy, but it clearly decided a longer life for native BlackBerry programs was required, even while the convergence of the tablet and handset platforms is accelerated to attract more developers.
A unified OS was not expected across the range for another year, but with Google re-harmonising Android and even Microsoft looking to Windows 8 to span PCs and tablets, simplicity is the order of the day. "Everything you build for BBX will run on everything we offer in the marketplace,” Lazaridis said.
He played up traditional RIM strengths such as enterprise class security. BBX also majors on cloud services, a hallmark of QNX, and has 100 open source libraries in its native environment, while also supporting Posix for a more open developer environment. The key bridge between BlackBerry OS and BBX will be HTML5, which RIM believes is the "future mass application platform".
The positive reaction from attendees at the conference must have been music to RIM's ears after months of little but criticism on all sides.
Julian White, CEO of development tools firm Seregon Solutions, told IDG that RIM needed to present a "coherent vision". He said that many developers were particularly impressed with Cascades, a native user interface framework acquired with Swedish company The Astonishing Tribe. Cascades, which developers hope to see applied to HTML5, is integrated into BBX and gives programmers access to low level APIs as well as higher level plug-and-play development.
Supporting the trend for "bring your own" smartphones in the workplace – a significant threat to the corporate BlackBerry contract – RIM will support a dual-profile system on all future handsets as well as the next PlayBook, allowing a "corporate partition" to keep enterprise apps and data separate from a user's personal activity. This will be integrated with BlackBerry Enterprise Server. There will also be a separate enterprise apps shelf in the BlackBerry App World store, which can be hosted by a company's BES and cannot be deleted by employees.
Like Google with its Chromebooks, RIM is looking towards a cloud-based world where users will access Microsoft applications and files from remote browser devices. It has announced a deal with Citrix to allow this to happen using the Citrix Receiver.
RIM may never be able to boast the sheer numbers of apps of the Android Market, but it claims its smartphones generate the highest ARPU per app in the market, and this is rising – BB7 phones deliver 11 times higher gross ARPU than their predecessors, while App World claims to be the second most profitable app store. RIM introduced a new developer program, BlackBerry Jam, with a Jam Community and Jam Zone, aiming to streamline the process for software writers.
BlackBerry suffers massive outages
BBX may recover some of the goodwill towards RIM, but it was launched in the friendly environment of its own developer conference, while in the world at large, sentiment remains primarily sceptical among customers because of the outages, which have compromised its reputation for sheer reliability, and among investors because of a perceived failure to address the plummeting share price with more radical restructuring or even sell-off.
Last week's meltdown of the BlackBerry service went on for three days, first hitting users in Europe, Africa and the Middle East and then moving to north America.
Vodafone latest rumoured suitor for RIM
Collapse of its email service could not have come at a worse time for RIM. Shareholder pressure is now mounting on it to do something, anything, to stop its share price from nose diving. The previous week's rumour of a new suitor for RIM – Vodafone - may have been one of the more fanciful, but the speculation continues to mount along with investor pressure for a radical solution.
The notion that Vodafone might be interested was just realistic enough to be tantalising. Despite all the conflicts of interests with other suppliers – think Google-Motorola writ large – and the poor track record of cellcos in creating their own devices or web platforms, the carriers do continue to dream of a mobile experience they can fully control.
Vodafone, has worked closely with RIM in recent years, injecting resource into the development of the BlackBerry Bold and other products and promoting the devices heavily. It is also one of the most prominent western operators in trying to adopt a Japanese-style approach, where devices are commissioned to order from tame vendors and the mobile user experience is designed and branded by the cellco. However, attempts like Vodafone 360 largely failed and even in Japan, the operators are acknowledging the rise of the vendor-branded smartphone.
Whether or not Vodafone is really interested, Jaguar Financial, which has led the call for the BlackBerry maker to be sold or broken up, claims more investors are coming support its campaign for change. Jaguar has been vocal in demanding that RIM take dramatic actions to reverse its flagging fortunes – change its management structure, seek an acquirer for its IPR or its whole business, and/or break into different divisions. Vic Alboini, Jaguar's CEO, said in an interview that its push was now supported by the owners of 8 per cent of RIM's shares (up from less than 5 per cent last month), and it was working on increasing that figure to 12 per cent. He expects to approach RIM directly with his demands soon.
Among other actions, Jaguar wants a new CEO – a “transformational leader”, no less – to replace Jim Balsillie and Mike Lazaridis, who controversially share the CEO and chairman posts. Jaguar also wants an independent chair. Other stakeholders, notably Northwest & Ethical Investments, have also called for the top management structure to be changed. But this might be the easy part – for years, RIM was too expensive to attract a buyer, despite persistent rumors and some clear strategic value for certain mobile players. In recent times, though, it is increasingly hard to see which companies would take it on, as its enterprise dominance is eroded.
RIM buys NewBay
Despite all the dark clouds, RIM remains determined to prove it is not giving up, and is pursuing a path towards a modern, cloud-based world. To strengthen QNX (now BBX), it has engaged in an almost manic (perhaps desperate) series of acquisitions to boost its software platform, including the important The Astounding Tribe. The latest is Ireland's NewBay Software, which makes a rapid service delivery platform for carriers. NewBay offers a range of tools for delivering messages, video, calendars and other types of content. Its flagship product, the LifeCache Platform, is designed to help service providers roll out new services and integrate them with their networks and billing systems.
This would see RIM seeking to be more indispensable to carriers, rather than being acquired by one – and that makes sense, since the BlackBerry has flourished partly because it provides a back-end service which drives traffic and smartphone uptake, while being famously efficient with the operator's network resources. NewBay was founded in 2002 and claims AT&T, Verizon Wireless, Deutsche Telekom, US Cellular, Telefonica O2, Orange and Telstra among its customers. RIM did not disclose the price but said the acquisition would not be financially material to the company, though the rumour mill quoted a figure around $100m.
It seems that RIM will use NewBay's LifeCache software as a foundation for future BlackBerry cloud-based content services, which could – like the email back-end – provide a back-up business model should the firm continue to dwindle in actual device sales. RIM's purchases this year have reflected a shift towards multi-platform services and cloud/web solutions.
They included video editing company JayCut, mobile social gaming provider Scoreloop, and tiny-Hippos, developer of the Ripple multi-platform mobile environment emulator. These would be clever choices for a company with a functioning web device strategy, such as Google or Apple – but are just pebbles on a vast beach for a company facing the storms that threaten RIM.
Copyright © 2011, Faultline
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