Skip to content

Causes of BlackBerry’s downfall: A cautionary tale

Blackberry phone

Quick navigation

The once-ruling mobile phone brand, Blackberry is still loved by many businessmen. The company stopped producing phones a long while ago when its market was disrupted. So what was the reason behind Blackberry downfall?

In this article, we will explore just what happened to Blackberry. 

Let’s start with a quick little history.

Blackberry Motion, introduced in 1984, is a Canadian software company specializing in cybersecurity in Waterloo, Canada.

In 1984, it was originally known as Research In Motion.

The company offered various products such as interactive pagers, smartphones, and tablets.

BlackBerry was once famous for its secure and reliable smartphones, especially among business users. (Because of its unbreakable security features)

The company’s QWERTY keyboard phones were popular for their email and messaging capabilities, making them highly preferable for professionals.

In 1999, their sales reached $85 million, and in 2000 they reached $221 million.

BlackBerry was the first company to offer push messaging on their phones. Blackberry was one of the first companies to enter the smartphone industry, controlling nearly half of the US smartphone market.

Blackberry’s line of unbeatable security features, which allowed professionals to guarantee full-proof security, helped the business become so well-known.

The phone had every feature, from crisis communication to vehicle security features.

Blackberry emerged as the ultimate solution for corporates who were constantly afraid of having their accounts hacked and their privacy violated. Hacking a Blackberry phone is still very difficult today. 

Understanding the reasons why Blackberry failed.

Not changing with the changing market:

Honestly, too many brands found themselves on the downhill path once they stopped innovating with the market. Something similar happened to Blackberry as well.

From 2008 to 2016, the mobile industry was rapidly changing, and many businesses perceived this change positively. On the other side, Blackberry was unwilling to change its philosophy.

For example, the difference between the two BlackBerry models was almost insignificant, particularly for the elites who were only concerned with their privacy.

So, the company didn’t welcome any new models. As a result, after a certain time, expanding the customer base became consistently challenging.

Consumers began to shift their preferences towards touchscreen devices which became more popular in the mobile market.

BlackBerry’s calling card was its keyboard, and the business missed the revolution that was the touch screen (spearheaded by Apple).

To amplify the mistake, the company bet the future of mobile on Flash, and its mobile OS failed.

BlackBerry’s competitor, Apple, has adopted the trend towards larger touch screens and full-screen displays.

Apple released the iPhone 4 in June 2010. Soon after its introduction, Apple’s phone sales surpassed BlackBerry’s for the second time.

Moreover, BlackBerry Motion struggled to attract customers who were accustomed to the more immersive, user-friendly experience provided by devices such as the iPhone.

These reasons led to the downfall of Blackberry in the highly competitive smartphone market. 

They rushed efforts to compete:

Many companies often fall apart when because of a lack of innovation.

But, Blackberry’s lack of innovation wasn’t the case.

In fact, they did innovate in their products but does their innovation efforts make any difference to BlackBerry’s downfall? umm…

Though BlackBerry has been popular since its inception, the company underestimated how rapidly the smartphone market was changing.

Every year, a new iPhone was released. BlackBerry attempted to stay up. It released innovative new devices such as the PlayBook tablet and Torch, but the devices were not well accepted.

The PlayBook was released without email software, making it useless to BlackBerry’s business-minded customers.

In 2008, one year after Apple had introduced the touchscreen phone, Blackberry entered the market.

The phone was called Storm, but it failed to attract customers. It had a variety of software problems and no Wi-Fi support.

Any program in the Blackberry phone could be opened by repeatedly tapping the screen, which would only irritate the user. 

So it’s clear to say that their innovation initiatives were not effective and only contributed to the reasons why BlackBerry failed.

If you’re wondering what other role did iPhones play in the downfall of BlackBerry… Let’s read ahead!

The narrowed customer base:

In addition, BlackBerry’s primary market was corporate and government clients who depended on its email and security.

The business missed out on billions of regular future customers since it was content to serve this group. Blackberry also lost out on a few excellent opportunities.

Consumers were drawn to BlackBerry Messenger (BBM), a very well-liked messaging program. But BlackBerry restricted access to the program to its hardware.

WhatsApp, which Facebook purchased in 2014 for $19 billion, demonstrated the utility of cross-platform messaging.

BlackBerry declared in 2016 that it would no longer be producing smartphones. BlackBerry Priv, which was released in 2015, was the company’s last smartphone.

According to Blackberry CEO John Chen,

“The company plans to end all internal hardware development and will outsource that function to partners.”

Jim Balsillie, a former Co-chief Executive of BlackBerry, stated in 2015 that the release of the iPhone by Apple and BlackBerry’s rushed effort to compete with it was disastrous for the once-iconic company.

In his first statements since leaving the company in 2012, Balsillie claimed that he realized BlackBerry couldn’t compete after the iPhone debuted in 2007 and after the Storm, BlackBerry’s buggy touchscreen device had a “100 per cent return rate.”

According to Balsillie,

“With Storm, we tried to do too much. It was a touch display, it was a clickable display, it had new applications, and it was all done in an incredibly short period of time and it blew up on us. That was the time I knew we couldn’t compete on high-end hardware.”

BlackBerry Downfall: What Happened to BlackBerry?

Only 207,900 BlackBerry devices were sold globally in the fourth quarter of 2016, accounting for 0% share of the total 432 million smartphones distributed worldwide.

In 2016, Chinese consumer-electronics company TCL essentially purchased the BlackBerry phone brand, resulting in the company’s exit from the smartphone market 14 years after the release of its first phone.

According to Statista, BlackBerry had a 33.2% share of the smartphone industry in the United Kingdom in December 2011.

Within two years, however, that had dropped by nearly half to 17.44%. BlackBerry has faded even further in the United Kingdom since the end of 2013.

According to the same research, BlackBerry smartphones account for only 0.01% of the UK smartphone market as of May 2021.

Lessons from the “BlackBerry Downfall” story

Blackberry’s failure can be attributed to its resistance to change, inability to keep up with evolving consumer preferences, rushed product releases, and a narrowed customer focus.

Business leaders should foster an innovation culture that encourages and rewards innovation within their organization.

This involves creating an environment where employees feel empowered to share ideas, experiment, and take calculated risks.

By prioritizing innovation, companies can stay ahead of the curve, adapt to changing market dynamics, and identify new growth opportunities.

Your first step in doing so can be – implementing an idea or innovation management tool in your workplace.

Also read: How Amazon & Walmart Contributed to JCPenny’s Downfall?

Liked our blog? Please recommend us.

Your feedback matters. Share away!