The CEO of Research In Motion Ltd (NASDAQ:BBRY) kicked up a storm last Friday. Thorsten Heins argued that tablets will be obsolete in five years. BlackBerry’s hasn’t done that great of a job at predicting the future in the past, which is why the company was so unprepared for the Tablet, touchscreen-enabled smartphone, and with mobile applications. In summary, the company wasn’t prepared whatsoever for the Apple Inc. (NASDAQ:AAPL) ecosystem of products, services, and software. The three combined is what dismantled Research In Motion Ltd (NASDAQ:BBRY), not just the new gizmo gadgets themselves!
Case against BlackBerry
I believe that the CEO already acknowledges that he has no significant edge in tablets because a tablet device is not meant to be a standalone device. The device has to be united with an ecosystem of products. Apple Inc. (NASDAQ:AAPL) makes it extremely easy for consumers to interchangeably share data between devices with iCloud making it not only possible, but feasible for users to upgrade to the next device or transition from one device to the other without the loss of user experience.
In fact, Apple Inc. (NASDAQ:AAPL) understands the consumer so well, it leaves me scratching my head. Apple’s success in iPad was driven more by Apple’s unique edge in both products and services. Part of the reason for why I am so reluctant to upgrade my own Laptop is that I find it extremely difficult to move all the files from my Windows computer, and programs to the next computer. In fact, it would probably take a whole day, including a technician. The reason is that a lot of the programs I have installed on my computer have to be uninstalled and reinstalled back onto the computer. Apple circumnavigates this problem.
One of the things that put Apple Inc. (NASDAQ:AAPL) ahead of other competitors is that your computer is literally cloned through every single one of your Apple devices. All your documents are digitally stored onto the internet. Applications are synchronized between all the devices, and better yet the content library of iTunes is seamlessly connected together.
Image: Research In Motion Ltd (NASDAQ:BBRY)
So the reason why the Apple iPad was so successful had a lot to do with the iCloud.
Research In Motion Ltd (NASDAQ:BBRY) BlackBerry is losing
Source: IDC
So of, course Research In Motion Ltd (NASDAQ:BBRY) would complain about tablets, it falls into the “other” category at 31.5% market share. I believe that BlackBerry’s CEO’s prediction over tablets non-existence was due to BlackBerry’s inability to gain any traction in the marketplace. So because of that, the CEO had to downplay the future potential of tablet computing.
Earlier in the day, I visited the Best Buy Co., Inc. (NYSE:BBY) store, and I couldn’t even find the BlackBerry device. In short the BlackBerry tablet isn’t given any floor space because Best Buy’s management team believes that the product cannot even recoup the cost of placing it on the sales floor. In fact, Best Buy Co., Inc. (NYSE:BBY) wouldn’t give up the floor space used on legacy desktop components like sound cards for BlackBerry Playbook devices. If the largest technology retail company isn’t willing to support BlackBerry devices in a standard retail channel, what does that say about Research In Motion Ltd (NASDAQ:BBRY)?
I’ll elaborate even further. If you look on Amazon.com, the BlackBerry Playbook has its price slashed by 67%. In classical economic theory, a lower price would increase demand, but in BlackBerry’s case, even with a 67% price cut, the product is still in stock. G4 rated the BlackBerry Playbook a 3/5 stars upon release. In short, Research In Motion Ltd (NASDAQ:BBRY) was a product flop. You cannot compete in the technology space with everyday low prices or discounts, especially not in fully industrialized markets like the United States and Europe.
Why does Apple do so well?
The user experience of an Apple Inc. (NASDAQ:AAPL) product is superior to that of Microsoft Corporation (NASDAQ:MSFT), Android, BlackBerry devices. It’s impossible to fight with the artistic perfection of simplicity.
