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BlackBerry 10 signals new round in smartphone war

This is the debut edition of Signposts, Arthur Goldstuck’s new weekly column for the Sunday Times Business Times. It is archived in The Big Change a week after appearing in print.

On 30 January 2013, BlackBerry served notice that it had rejoined the smartphone wars.

The spotlight was on the first phone sporting its new BlackBerry 10 operating system, the Z10. But, between the scripted lines of the launch event, the company formerly known as Research in Motion (RIM) sent out many signals of a newly fortified brand.

On the surface, the Z10 is merely a high-end device playing catch-up with all the high-end devices from rivals like Apple and its iPhone 5, Samsung with the Galaxy S III, and Nokia armed with its Lumia 920. These three phones also happen to run on the three major rival operating systems, respectively Apple’s iOS, Google’s Android and Microsoft’s Windows 8 Mobile.

The older BlackBerry 7 operating system, which underpins the current ranges of Curve, Bold and Torch phones, could never be mentioned seriously in this company. The founders and former joint CEOs of RIM, Michale Lazaridis and Jim Balsillie, would not bring themselves to admit it – one of many reasons they needed to step aside and make way for the current CEO, Thorsten Heins

While his predecessors had paved the way for BlackBerry 10, Heins instantly set about changing the way the organization thinks about its customers and its technology. One of the many outcomes of his new-broom approach was the announcement, on Wednesday night, that the RIM brand would be killed off, and the company would henceforth be known by the same name as its core brand, BlackBerry.

Symbolically, the new branding buried RIM’s recent past and its one-time culture of attempting to dictate to customers what it thought best for the market.

The Z10, said Heins at the launch in New York, viewed via webcast at local launch venues around the world, including Johannesburg, was a result of listening to what users were asking.

While previous phones were designed on the basis of what the hardware and software allowed, this phone could be said to have been built “from the user up”, making the user experience central to device strategy. This represented BlackBerry coming full circle from the period after Apple had launched the first iPhone in 2007. At the time, it was a tenet of faith within RIM – as it was at Microsoft – that no one wanted a touchscreen phone. They thought they knew better than the market, even while Steve Jobs was leading Apple into a new era by giving users what they really did want.

The death of the RIM brand also spells the end of the arrogance that almost destroyed BlackBerry. Ironically, the lessons that BlackBerry learned from Apple are ones that the latter would do well to learn again. iOS 6.1, released the day before the BlackBerry 10 launch, on the surface shows very little evolution from what was, in 2007, a revolutionary operating system. How easily we forget that BlackBerry itself was once revolutionary, with its powerful e-mail and security applications.

For South Africans, the BlackBerry revolution was driven by the fixed-priced BlackBerry Internet Service (BIS), which allowed near-unlimited Internet use on the phone for R59 a month. Its popularity among youth was fuelled by the appeal of BlackBerry Messenger (BBM), while the enterprise market was enthralled by the extent to which it was designed to link up with corporate networks and mail systems.

BlackBerry 10 retains BBM, and builds on it: voice chat, video chat, and video-conferencing are built in. It also builds on corporate appeal, especially with a feature called Balance, which allows companies to control the aspects and usage of a phone that is linked to the corporate network, while personal features and usage remain private.

Of the three “killer factors”, only BIS has not fully survived BlackBerry’s reinvention. While it will still be available on BlackBerry 7 phones, which will continue to be developed, the data-intensive environment of BlackBerry 10 would not flow comfortably through the encryption and compression network that makes BIS possible.

But BlackBerry has a potential secret weapon to counter the bleats of the BIS-less. The text chat component of BBM will still be managed through the BlackBerry network that made BIS possible. So, while the Z10 and its successors will be sold with the same kind of data plans that come with most high-end smartphones, it is possible to bundle that with a low-cost BIS subscription that covers unlimited BBM text usage. This kind of text chat uses so little data, it is even possible for networks to offer its use for free, as long as there is a data plan in place.

While the devices are important, it is this versatility of the new operating system, from both a user and network perspective, that signals Blackberry’s re-emergence as a contendor on a crowded battlefield.





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The Big Change is a business strategy blog and newsletter published by Arthur Goldstuck, managing director of World Wide Worx, a leading technology research organisation based in Johannesburg, South Africa.

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