BlackBerry in 2012: More trouble in store for RIM

The year 2012 promises to be an interesting one for BlackBerry-maker Research In Motion (TSX: RIM). The Canadian company has come upon some tough times lately. And despite a number of key product releases and enhancements, things will only get worse before they get better for RIM … if they do at all. Here’s why.

I’ll start by saying that RIM’s not going anywhere in the coming year. Just because it is struggling right now, with market share and customer loyalty dwindling and its foothold in the enterprise losing strength every day, RIM is still a major player in the handheld space and it’s not just going to fall off the face of the earth, taking its BlackBerry handhelds and tablets along for the ride. RIM’s still hanging on, in other words.

But that also doesn’t mean the BlackBerry manufacturer will be able to pull itself out of its ongoing tailspin.

RIM should release a number of exciting new products and services in 2012, which will help keep the company afloat in the increasingly competitive mobile space, but I don’t expect RIM to gain significant market share, at least not in the United States; RIM market share will likely remain steady throughout the new year, right around 10 per cent of the U.S. market.

Pros and Cons of BlackBerry 10

In early 2012, RIM should release the first smartphones running its brand new OS, BlackBerry 10. BlackBerry 10, formerly referred to as BBX, will have a strong focus on touch and touch navigation. And it is designed to grab the attention of users who may be eyeing new iPhones or Android devices.

That’s a good thing, but I worry that RIM is losing sight of a key element in its early success: The “physical,” button-based keyboard. I wrote a blog post recently asking whether readers wanted touch screen devices or QWERTY BlackBerrys, and more than 80 per cent of the roughly 200 respondents said they would rather RIM focus on devices with button-based hardware keyboards.

At least a few of the new BlackBerry handhelds running the BlackBerry 10 OS will be 4G/LTE devices, and that’s sure to motivate wireless carriers to put more marketing hutzpah into pushing these new BlackBerrys to customers. And consumers may be more attracted to these 4G BlackBerrys than RIM’s current smartphone lineup — though I’m not sure the average smartphone owner really cares all that much about 4G. (A recent poll found 40 per cent of respondents in no rush to upgrade to 4G devices.)

So while RIM may gain new users thanks to BlackBerry 10 and its upcoming push to 4G, the company could also drop some loyal customers due to that fact that many of its upcoming handhelds will be much more focused on touch screen navigation, something RIM has not exactly done well over the past few years.

BlackBerry PlayBook Enhancements: Too Little, Too Late

RIM will also release a new, updated version of its PlayBook OS, v 2.0, with native PIM applications and an Android Player that will let PlayBook users run certain Android apps.

But I can’t help feeling somewhat underwhelmed, maybe even a bit resentful, because RIM promised all of these features and functionality months ago and hasn’t yet delivered. Nor has it shipped a cellular version of the PlayBook–the current version is Wi-Fi only — even though it said such a tablet would become available in summer 2011. I bet I’m not the only PlayBook owner who feels disappointed. These new PlayBook features and enhancements will likely prove to be too little, too late for many tablet users.

Then there’s RIM’s stock price, which just last week hit a 52-week low.

All of these things do not bode well for RIM in 2012.

Hanging on in the Enterprise and Outside North America

I do think that RIM will maintain and even possibly strengthen its foothold in areas outside of North America. (It’s clear RIM is still quite popular in many locales outside of the United States and Canada, just look what happened when RIM recently decided to launch and discount a brand new BlackBerry at a shopping mall in Jakarta, Indonesia. Pure chaos.) But RIM is facing a serious challenge in regaining consumer confidence in North America, a key market, and I’m not sure BlackBerry 10 or the new PlayBook OS will prove to be the solution to this problem.

On the enterprise side, RIM still has a solid grip on the business smartphone and mobile infrastructure market, but it is rapidly losing strength. That’s due to the influx of non-BlackBerry devices that users are bringing into the enterprise and asking IT to support. Supporting only BlackBerry devices is really no longer an option for most IT shops; iOS and Android are entering the enterprise, like it or not.

RIM has announced a new enterprise mobility offering, called BlackBerry Mobile Fusion, which will allow IT to use RIM software to manage not just BlackBerrys, but also iOS and Android devices. But this could have an unintended effect on RIM: With users choosing iPhone and Android devices over BlackBerrys, and so many companies now rushing to iOS and Android security and management products to market — including RIM — why should IT purchase any more BlackBerry handhelds?

In summary, 2012 to be another difficult year for RIM and BlackBerry, and if the company isn’t able to at least turn things around a bit in the coming year, I could very well be sounding the death knoll for BlackBerry right around this time next year.

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Jim Love, Chief Content Officer, IT World Canada

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