What we learned from RIMM

We used to really like the expression “The best way to learn is from your mistakes.”

In fact, we try like hell never to repeat the same mistake.

But one day, someone called BS on that expression.

“The best way to learn is from someone else’s mistakes,” he said.

Touche.

While, we must stress that mistakes bring with them tremendous learning opportunities, but if you can avoid that first gaffe and still learn the same lesson, cheers to you.

Which brings us to Research in Motion, the makers of BlackBerry devices.

RIMM just announced the overly-due refresh of its operating system, OS 7.0, will be available later this month.

That means the OS will be ready sooner than expected, but will it be enough to save the company, which has been laying off employees en masse?

We view this as a slight positive for RIMM. As we have written before, shipment volumes are not the problem with RIMM (our FY12 shipment estimate is 51MM units – basically flat with FY11). Rather, we believe the company will continue to see greater ASP pressure as the competition in the smartphone arena continues to build. While today’s announcement should help keep RIMM ‘in the game’ – we believe key part of a RIMM turnaround will be built around the company’s next generation of handsets (QNX). – Jennifer Fritzsche, Wells Fargo

We expect sell‐in of the products during August to boost revenues for 2QFY12 (August 2011). While new products typically pressure GMs a bit, these products look similar enough to older models that it should not be a major problem. We don’t think new Bolds and Torches with incrementally enhanced browsers will turn the ship around at RIMM. The company needs to make a big splash with the QNX OS and new form factors next year. While 2QFY12 numbers could be strong based on sell‐in, there is the risk that sell‐through numbers in 3QFY12 (November) will disappoint. – Michael Genovese, MKM Partners

Not exactly a glowing outlook from analysts.

But where did RIMM go wrong?

No where. And that’s the problem.

RIMM monopolized the enterprise Marketing, chaining mid-level managers and C-level execs alike to their “CrackBerries.”

Then, when Apple began rolling out the iPhones, RIMM proclaimed them unfit for the enterprise (which they were at first).

But instead of taking advantage of enormous market share and years of feedback and research, RIMM let Apple enter the enterprise market – then Droid phones, too.

It seemed RIMM was satisfied to let its contracts with huge companies like Disney run their course and let IT departments and executives familiarity with the Technology win them a new one.

We happened to be one of the first at ESPN to trade in our BlackBerry for an iPhone, and IT support was almost non-existent.

To bring this all the way around, and apply to lesson to our industry, we learned that good enough isn’t good enough.

Business owners, celebrities, public figures, large companies, publishers, anyone who wants a web presences can learn a valuable lesson from this.

In fact, it was a prospect we were talking to the other day who brought this to our attention.

Twelve years ago, you could own your market with a any old thing that was online. Just the fact that your brand was on the Internet gave you an advantage over your competition. Yes, it was expensive because it was relatively new, but the innovation curve was steep.

Six years ago, simply having a presence didn’t mean much anymore. Anyone or thing who was anyone or thing had something on the Internet. Nope. Now you had to have a website that offered information, news, entertainment, tips something above and beyond your basic info, contact methods and mission statement. You needed a publishing platform that would amplify your message and keep you relevant in a sea of growing noise.

Two years ago, this stopped being enough. Every company, celebrity, etc has a blog with comments that gets updated at least somewhat regularly. But with the crushing amount of information and noise online, you couldn’t expect your customers to come to you. You had to start going to them. Call it the Social Media or Interent Marketing era. This is where we currently live. Businesses and individuals are beginning to realize they need to engage their target market where they “live” online, which, right now, is Facebook, Twitter, YouTube and those guys.

So everyone’s scrambling to figure that out. But, we’re starting to see the dust settle and these networks are becoming less and less mysterious. We’re starting to see a new shift from people looking to grab yet another competitive advantage. We’re seeing traditional companies really wanting to push innovation.

Applications and products that we’ve traditionally seen left to startups to build and then let entities use are starting to be conceptualized by the entities themselves.

It’s tough to get into specifics because of NDAs we’re under. But imagine a surf shop. We’re seeing companies in industries like this trying to build value-added services into their web presence like a wave finder, board builder, instructor locator, streaming video and more bundled into one app and available on mobile devices.

Sound expensive? It is. Each step we just went through required more and more investment. But it’s the entities that get in early that enjoy the most benefit.

You see, the cost of development doesn’t go down – in fact, as more and more entities chase early adopters, development prices go up with demand.

So while it may seem scary for a medium-sized business or individual to invest a good chunk into something like this, the ones willing to take the risk pay less and get the online advantage over their competitors.

So, what can we build for you?