Blackberry: Corporate dominance under treat as bankers opt for iPhone

Revenue for the first quarter of fiscal year 2011 ending May 29, 2010 is expected to be in the range of $4.25 to $4.45 billion.

But despite the figures, Wall Street was disappointed as the net revenue figure of $4.08 billion fell short of the analysts' forecast of $4.31 billion. As a result RIM's stock took a beating.

And then there are other, more pressing, concerns about the company. Chief of these is that the firm is finding itself in a pitched battle for the consumer smartphone market, going head-to-head against Apple's iPhone and a number of devices that run on Google's Android software.

In the latest development, Standard Chartered bank said it is replacing the BlackBerry, currently its standard corporate communication device, with the iPhone, a move that could eventually result in thousands of its bankers switching to the Apple device for business communication on-the-go. Meanwhile, in Singapore, local bank OCBC has given its staff the option of a similar switch.

The process of migrating corporate e-mail services from the BlackBerry to the iPhone started about a month ago, said a Standard Chartered spokesperson, who did not say how many of the Asia-focused bank's 75,000 employees used the company-issued BlackBerry. Bankers at other financial institutions such as HSBC and Morgan Stanley have been restricted to the BlackBerry as the standard device issued by their firms for business communications.

Though not official, indications are that RIM is preparing its own tablet computer that will launch in 2011. Currently known by its codename of BlackPad or Cobalt, whether the not-so-original invention can save BlackBerry's sales remains to be seen.

Brand health diagnosis

Taru Jain, managing director, XM Asia-Pacific Singapore:
"Daddy, your phone is sooooo boring!" exclaim my children (ages seven and nine) every time they look at my BlackBerry. The problem is that the brand has become undifferentiated and boring. A 2009 Crowd Science survey found that four out of 10 BlackBerry users would switch to iPhone.

So where did BlackBerry go wrong? This is how I see it.

Earlier: BlackBerry = work; iPhone = fun.
Today: BlackBerry = work; iPhone = fun + work.

BlackBerry remains the work device, especially for emails, but it has not innovated fast enough to claim that work positioning outright and is app-deficient. It has been slow in bringing work-relevant apps like LinkedIn, or Bump, that helps exchange business cards by physically bumping phones together (which may be the most fun part of some meetings).

The iPhone, on the other hand, has kept innovating. With three billion apps downloaded, it has begun to effectively cater to executives' work needs, while staying streets ahead on the fun factor. Even security-hyper organisations like banks have started issuing the iPhone as work devices."

Andrew Knott, chief digital officer Asia-Pacific, Euro RSCG:
"The entire smartphone category has exploded in the last year, and while Apple and Android are the darlings of the tech press and growing rapidly, the fact is that RIM increased market share and is close to overtaking Sony Ericsson.

Consumers are starting to bring their own smartphones into the workplace and demanding that their organisations accommodate them, but BlackBerrys integrate well with enterprise applications, have an open development platform, great security and compliance, and are available from most carriers. Everyone is focused on the opportunity in enterprises.

From a branding perspective, BlackBerry is under threat from iPhone and Android and RIM is almost invisible in comparison.

However, in another part of the tech world Windows is the still the OS of choice, Office still dominates the productivity suite, and there are more Dells sold than iMacs.

The sex appeal of Apple might move consumers, but it isn't the only way to win. While there is a market at the bleeding edge, there is a much bigger one in the middle."

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This article was originally published in the 3 June 2010 issue of Media.