Last Monday, fallen Canadian smartphone titan BlackBerry announced that it was exploring “strategic options” to best direct the company’s future. To laypeople, this means that the former king of the smartphone world is in very, very deep trouble.
BlackBerry first burst into the scene in 1999 with a highly popular pager. In 2003, they debuted what was arguably the world’s first ubiquitous smartphone, supporting email, calls, texting, web browsing, faxing and push notifications for all. It was particularly notable for its email integration, a service that was otherwise unavailable in the mobile market.
Due to these unmatched capabilities, BlackBerry enjoyed a lion’s share of the smartphone market. Then the iPhone came along, with Android phones following close behind. BlackBerry quickly found it’s bulky design and dated OS rendered obsolete and unpopular, particularly as other smartphone manufacturers moved from traditional physical QWERTY keyboards to digital ones in order to increase screen real estate while BlackBerry obstinately stuck with their traditional button keys, which took up over half of the device’s front surface.
Until recently, government workers have kept the flagging smartphone company afloat. Due to BlackBerry’s remarkably strong encryption programs, they are the only company that makes smartphones that have been deemed secure enough for use by government employees privy to sensitive information. Indeed, publicity photos of president Barack Obama taken in 2008 showing the president with his BlackBerry and his glowing statements regarding the phone’s quality have been valued as a celebrity endorsement worth $25-50 million.
At that point, BlackBerry lorded over 51% of the smartphone market. Today, they command 3.4%.
It now appears as though government dollars won’t be enough to keep BlackBerry in business, at least in its current incarnation. The “strategic options” to be explored include a sale, public or private, or a joint venture with another company. The majority of industry pundits believe that a sale is in order; however, the identity of any potential buyer is a mystery, as very few parties have thus far demonstrated any interest in the failing company.
Even in the event of a sale, it will take a superhuman effort to prevent the BlackBerry brand from completely flatlining. The brand’s image is now so badly tarnished that it will be incredibly difficult to convince consumers to switch back from their iPhones and Droids.
