On Thursday, the maker of the once-ubiquitous Blackberry devices, Research in Motion, reported its quarterly results. They were not pretty.
Having already cut its estimates weeks earlier, the company underwhelmed already low expectations. It confirmed that its new products meant to compete with the Apple iPhone and other increasingly popular smart phones would not be ready until at least the fall. The company is also attempting to retool its hastily and rushed-to-market Playbook tablet, which was supposed to be an alternative to the iPad but which by almost universal agreement was nothing of the sort.
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With revenue down, earnings weak, products delayed, and enthusiasm for Blackberries waning, the company has seen the value of its shares plummet in the past few months, and its brand severely tarnished. Even so, it did manage to ship more than 13 million devices in the most recent quarter, which is hardly nothing. It has loyal corporate users (I’m one of them), and while it has long since surrendered the “cool” label to Apple and a legion of Android phones, it has (or at least had) its advantages for email and business use.
But the rapid decline of Blackberry is yet another sign of how quickly the pace of technology and innovation can deluge a company. A few years ago, Research in Motion appeared to have an unassailable position as the dominant provider of what used to be known as “PDAs.” Now, many in the industry and on Wall Street have concluded that it is a dead man walking, soon to join Palm and other early movers like Atari and Netscape as technology has-beens.
Its fall is twined with the equally dramatic reversal for Nokia, which had been by far the leading maker of cell phones globally throughout the first decade of this century. While both Nokia and Research in Motion are still multi-billion dollar franchises, their business have deteriorated with stunning speed. Customers who once would have contemplated owning nothing else are now embracing new gadgets and devices, showing that consumers have very little brand loyalty in a world of rapid innovation and lots of choice.
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The fate of Blackberry and Nokia should and likely does send shivers down the collective spines of executives at other companies. Intel, Hewlett-Packard, Dell, Microsoft — all of the giants of the modern tech era must be aware of how quickly it can all go sour. Even Apple, sitting atop that heap today, knows from experience that we could be writing the same story about it in five years.
The rise and fall of these franchises should call to mind the old aphorism attributed by Herodotus to the Greek philosopher Solon when asked about King Croesus. Once the richest monarch in the world, Croesus ended his days a captive of the Persian emperor, watching as his realm was conquered and his fortune dispersed. He had once scorned Solon who refused to acknowledge Croesus’ good fortune and had instead remarked, “Count no man happy until he is dead.” At the end of his days, the king finally understood the wisdom of those words. Nokia and Research in Motion are coming to know it as well, but so should those for whom such a fall seems distant and unlikely.