Is BlackBerry really on the right path?

Is BlackBerry really on the right path?

Summary: Chief executive Thorsten Heins thinks so. Notes from this morning's investor's meeting.

TOPICS: BlackBerry, Mobility
Photo illustration: Andrew Nusca

You've got to feel for Thorsten Heins. 

Eighteen months after the Siemens veteran was named chief executive of Research in Motion, now BlackBerry, he's still fighting to tell the world that the company will be OK.

"BlackBerry will pursue every opportunity to create value for shareholders," he told investors this morning, as if they expected him to say anything less.

Impossibly, the Canadian mobile company continues to say that it is in the midst of a turnaround, even as it continues to deliver underwhelming goods. More impossibly, we keep buying it.

(Just search the web for the terms "make or break" and "blackberry" and you'll see members of the press set, then reset, milestones for the company. In 2013 alone, which is only half over, we've already seen the BlackBerry 10 operating system and a new family of devices—the Z10, Q10 and Q5—make headlines, then disappoint with lackluster sales and poor execution.)

Is meaningful change really underway? Heins continues to talk about a "transformation," and that's undoubtedly the case: new OS, new phones, new executive team. But it's unclear whether this "transition," as he has also described it, is both moving in the right direction and fast enough to matter. As in politics, "reform" moves in two directions.

Sentiment is souring:

"The fault lies with the devices themselves," Needham and Company's Charlie Wolfe said after the company blew its latest quarterly earnings. 

"It is not the end / of the road for BlackBerry / but it may be close," BGC analyst Colin Gillis wrote (in a haiku!) to investors.

"Irrelevant," Enders analyst Benedict Evans spat about the BB10 operating system.

And that's just a sample.

You should take analyst's opinions with a grain of salt, of course; the proof for mobile success is in the pocket.

But it's not any better there. In her review of the Z10, Jess Dolcourt said it "got the basics right" but was "not enough of a draw" for Apple and Google customers—hardly a glowing endorsement. In his review of the Q10, Sascha Segan wrote that the operating system was "too far behind" the rest of the market. That's the case for BlackBerry the company, too. 

Thorsten Heins keeps telling us to be patient, but that patience is clearly wearing thin. He might want to study up on a century-old old American idiom: "Put up or shut up."

Topics: BlackBerry, Mobility

Andrew Nusca

About Andrew Nusca

Andrew Nusca is a former writer-editor for ZDNet and contributor to CNET. During his tenure, he was the editor of SmartPlanet, ZDNet's sister site about innovation.

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  • I am not sure why everyone is so down on these devices

    QNX is a nice OS, they've clearly got themselves modern looking devices again, and they're highly manageable which makes them good for business. And the BlackBerry Balance thing seems like a pretty good idea.

    Now it is true that all BlackBerry has done has caught up. They haven't leap frogged or anything. But they do make nice enough phones.
    • Because the status quo is powerful.

      "As good as" isn't enough to make people elect for change.

      I think that notion, plus the fact that the company went all-hands-on-deck just to make "decent," is what's got everyone so worried.
      • Phase 3

        Blackberry doesn't see their future as a manufacturer of mobile phones, these are fast becoming commodities, (indistinguishable from each other) as even Apple is now discovering. The next generation is smart devices that talk to each other and share information. This is the direction BB sees for QNX, (phase 3, current step was phase 1) and it is a nice fit, because it is the preferred RT OS where it is imperative that the OS never fail, such as in nuclear power plants, space shuttles etc. Self driving cars and other smart applications will be the next thing where a never fail RT OS will be imperative. Supposedly that will be BB phase 3, and phase out smart phones unless they talk to smart cars etc.
    • Because there is no compelling reason to change eco-systems

      In my opinion, the eco-system is more important than the individual devices. For BB to succeed, it needs to convince customers to change eco-systems, to abandon all of the apps that they have purchased and to re-purchase those for the BB eco-system, which in some cases is going to be quite expensive, assuming that equivalent apps even exist. It also means convincing people to abandon their hardware (Apple or Android or Win) and to re-purchase BB devices. To change devices would mean for people to change from their current tablet to a Playbook - you know,the tablet that BB now refuses to upgrade to its latest OS.

      Overall, changing eco-systems is an expensive "ask", especially for consumers, and especially if there is no compelling reason to do so.

      Those are just some of the reasons why BB is struggling and will continue to struggle.
      • No thanks

        I don't want an ecosystem. I don't want to buy anything or be limited to the services by one vendor.

        I have terabytes of media that I want to use with whatever device I choose based on what I value. If the ecosystem was what mattered then they should give me the device for free or for a very low price. That would have value now it's just provide a payment option and pay and pay and pay.

        Hopefully HTML 5 Apps mature and deliver on this, then the device won't matter as they will work on any device capable. No lock on, pick the services you prefer. That's how the internet worked. Now it's some commercial mess that provides "free" services but steals every detail about you they can to use it ways you'd decline if asked.

        Outside of a handful of purchased Apps what are people's real invest with free Apps? Most of repackaged versions of their website in a mobile view. Lately I find myself using less and less Apps.
        • Well and good

          there is nothing wrong with you making those choices.

          However, your direction tends to put you in the minority. "Most" people choose an eco-system and get double the value from their apps by being able to use those on a smartphone and tablet.

          We'll see how HTML 5 unfolds :-)
      • Eco system

        I tend to agree completely with this statement. I purchased the Z10 and I am loving it. However, all around me are members of my family who have preferences either apple due to communication between products, or others who have invested heavily in iTunes or google play. I believe the delay to get the right product to market soon enough has caused consumers to choose between the two major players. My daughter went android because she could not get an iPhone on Verizon when it first came out due to the deal with AT&T. Now she has no interest in ever getting an iPhone. I believe this is the way it is with most consumers. Blackberry has to offer something extremely compelling or allow crossover to get back in the game. I am a loyalist and I would not switch over,although, I came close due to frustration. I was not an apps user so it wasn't a pre-condition. Dropping playbook is a mistake. It is a good product and one that is useful and by doing so Blackberry is creating ill will among those loyalists who purchased it believing the upgrade to BB10 was coming.
        • agree

          Dropping the playbook is a big mistake I have 4 in the family all getting daily use.
          Home Grown IT
  • It's called Marketing

    The new BlackBerry 10 is competitive as an operating system. Sure it doesn't have the massive ecosystem but a glaring absence of marketing has hurt the company the most.
  • Playbook OS update reneging will probably put BB out of business

    BB along with Thor(where is his hammer)ston Heins will probably be just another tech memory in two to three years, like Palm is now.
    Fatal mistake is the cancelling of the playbook OS update to BB10.
    Glad I did not get the Playbook.
    My wife has the 32 gig one (picked it up for $118 at Walmart) it is a decent device but lacks severely in the App dept. Her Z10 which her work bought for her is OK but I prefer my Galaxy SII lte as the apps are better and cheaper on Android or simply not even there for the BB, and heck the screen is even larger on my SII, not to mention the SIII and S4! They have buried themselves with constant missteps and most of the public don't even pay attention to BB any more, and those that do are mostly ticked off at BB now.
    They still have a small market share in business circles, but that is shrinking as well and will continue, as bring your own device to work increases and nobody brings a BB.
    It's sad as BB was a thriving North American company, and all they had to do years ago was keep an eye on consumer trends worldwide and keep up. I doubt they can catch up now unless they do some fancy backpedaling and speed forward with some innovative devices.
    I hope I am wrong as competition is usually good to have.
  • BlackBerry WHAT IS Wrong with YOU ALL???!!

    I have never seen a company like BlackBerry!! There are MILLIONS of loyal fans & customers of BlackBerry, who are just waiting to get the new Q10 or Z10 phones, but cannot because their carriers STILL don't have it yet...mainly SPRINT!! If BlackBerry has problems getting back into the "market"--why not put the phones out there so EVERYONE who wants one can FINALLY get one!!!?? Why all the stalling!? I am so frustrated in waiting & waiting on BlackBerry to get all its phones to Sprint that I am ready to get another phone because it seems like they aren't coming around! This is STUPID! Sell your phones like everyone else does! What are you waiting for!!???
    • Ummm take that up with Sprint

      What should Blackberry do, hijack a Sprint store and just sell them? It's business, Sprint has a LOT of money tied up with Apple and will push the iPhone every chance they get. It's crappy but it's their choice.

      Blackberry users on Sprint need to just take their business elsewhere.
  • Don't count your chickens yet...

    I remember when Oracle, IBM and Apple nearly went bust. It took all of them several years to turn it round.

    BB10 is on the right course and I personally now have a Z10 and I like it. My wife recently bought the Q10 and she really likes it particularly the keyboard.

    I would not want a world of just Android (which is really Samsung), iOS with Apple and Microsoft with Windows phone 8.

    BB10 aka Qnx is a really good OS. I believe Blackberry needs another 12-18 months to take BB10 to the next stage as it is a very good foundation to build on. Blackberry has $3B in cash so it is not on its deathbed.

    Analysts I believe in as much as I do weather forecasters, as for greedy shareholders stop trying pull down a company that can become a force for the future.
  • its not in the interest of the consumer

    Ive been saying this for yrs now and no one listens they serve nothing to the consumer as we tend to look elsewhere for the best buy. They are very overpriced as is anything but they lack too much for me to buy another one as ive owned them all so I feel its more centered around the business people. The majority is consumer based remember that not business so people want the best for their money not limitation like bb10. By the end of the year there will be no bb as it will miss its quarterly earnings from here on out. People are buying older bb's so what does that tell the consumer right off the back, certainly not to buy it thats for sure. I was a former bb user too so dont comment as if I never used one before, so I know what im talking about as I own them all right now. Ive tried bb10 for 3 months as it far enough but its lacks way too much right compared to needs right as I sold it for a windows phone lumia 928 and currently have I phone 5 and note 2. So bb is off my list for good as many others too within the next year or so.
    • Ever heard of punctuation?

      I'm kinda wondering if you are an example of a person that should be using a BB10 device so that it does it's auto-correct and prediction magic to make it look like you attended school and learned how to punctuate properly. You say how much BB10 is missing, but don't specify what features are missing. I don't mean apps, I mean built-in features and modern functionality.
      John Hanks
  • keep writing for 'master' microsoft

    drumming up windows phone long dead and dumping on competition knowing that it is better in every respect.

    And drag the microsoft fan boys along. They are right here and dwindling in numbers.
  • Well...

    Blackberry has its strength, especially in hardware and security and managing. But the platform is limited. Its simply not in the league of the competing platforms... and when you are late to the party, it too hard. In terms of hardware sales blackberry will have a tough time in the near future.
  • A Small Prediction...

    Thorsten Heins has placed a lot of emphasis, vocally, on the smartphone and not on the tablet as the dominant device of the future. The abandonment of the PlayBook is consistent with those comments. Why is it necessary or even sensible to own two devices of similar capabilities simply because one provides a bigger screen? Why not treat the tablet as just a monitor with the smartphone providing the CPU, WiFi and other services?

    The smartphone then becomes the brains while the tablet becomes little more than a display with touch capabilities. It would keep the tablet very inexpensive. It would allow software to be developed for the smartphone that would be available on the larger screen. Bluetooth keyboards would work fine with it, maybe even a mouse or even the the soon-to-be-released Leap Motion. Why do we need two CPUs, dulplicate RAMs and all that stuff just for the sake of having a larger screen in our hands?

    I predict that BlackBerry will differentiate itself in the marketplace by providing such a device. I would own one in heartbeat.
    • Didn't Palm try that exact thing?

      It flopped
      • Palm?

        I think technology has advanced since the days of Palm to allow more ambitious solutions to be developed. So, no, Palm didn't do "that exact thing." There was no tablet market in those days, no software ecosystem, no Palm was ever Internet-centric and smartphones had not replaced PCs as the dominant computing devices. Duplicated hardware in a smartphone and tablet are environmentally and practically hard to justify when the tablet needs only to be an interface and display for the smartphone.