RE: [MD Internal] Re: BlackBerry delusions
On June 7 2012 Doug Simmons wrote:
Fellas, fellas… Let me go on record here with another stock prediction, this one with less confidence that before: Rim has almost bottomed out, maybe with the floor of about $3/share. By the way I’m the guy who said back in September 2010 “short RIM because, though it does have a pretty low P/E, I think it will get trounced by the other guys hard enough for them to feel the pain” when it was trading at 50. You would have multiplied your money by seven.
They will find cash one way or another, like they did the most recent quarter. They will also continue to figure out how to pull in profit without having to spend as much and not collapse in the process, which they also did in the most recent quarter. Their income has been heading in a scary direction, but not that scary, and they are nowhere near bankruptcy territory. Buyout target yes, bankruptcy no.
If you look at their balance sheet alone over the last few years and forget the vision of the market cap tanking, for having a big stash of cash that isn’t quickly evaporating and a healthy pile of assets, not that much lower revenue and profit, it’s odd to then look at a chart of the stock and see how it’s been crashing like this.
It’s oversold, its future isn’t as bleak as a 4 price to earnings suggests, and don’t quote me on this but for work purposes, as that’s really all it lets you do and all that I want to be able to do on a work-related piece of technology is work and not be able to screw around, the Blackberry Bold 9900 is pretty damn good. For emailing specifically — and of course BES management which ain’t easy to top. No surprise to me to see Eric Schmidt (google chair) getting caught TMZ-style using that phone.
They might beg to get bought out on the cheap, they may sell assets faster and faster, they may do a reverse split, if they run out of too much cash they may declare chapter 11 (the good bankruptcy) but not 7 and that would not happen anytime soon, but they won’t get delisted and the day of your walking into a somewhat moderately-sized phone joint and not find the a blackberry shelf will never come. Guaran’-effin’-teed.
And that right there is post-worthy, so I might as well go ahead and sign it:
Blackberry is the Jitterbug for the business world. The only people I see with any interest in Blackberry devices are technically challenged CEO’s who think they are technically superior. Here’s why Blackberry needs to change or die: Microsoft Exchange FREE Activesync. Nearly every major business and corporation is on Microsoft Exchange which provides free (and better) email/contacts/calendar syncing to 90% of the devices out there with no additional outdated BES server to manage or fees to pay. Any self respecting IT network staff will fight tooth and nail to make sure BES has no place in the server room.
Now tack on that those technically challenged CEO’s want to play with the toys that the “kids” are using to be hip and see what all the fuss is about, they will eventually be talked into scraping Blackberry and their ridiculous fees for a better, faster, easier to manage, more secure solution.
Blackberry is dead. They just don’t know it yet.
It would seem to me that it is the technically challenged top brass (and the rank and file) are the ones rooting for iPhones and Androids, whereas it may, to everyone else’s chagrin, may save IT resources if they have to support only a few different standard-issue Blackberries rather than everything under the sun, particularly if a given company has an elevated concern for privacy and the appearance of doing things the best way to that end. Just like not letting you use Firefox and Opera and other things we hate about IT.
At most companies I imagine everything you get with ActiveSync or something like Google Apps and its phone management (which uses ActiveSync) gets the job done, remote wipe, locate, some phones with full encyrption etc, but if you need to finely tune what users can and cannot do on their phones and how those phones function, not too many things come to mind that hold candles to BES+Blackberries if, again, your company doesn’t have a casual regard for this sort of uniformity. It’s nice not to have to care about such things.
That said, with BES competition sprouting up and RIM releasing the Fusion thing to hook up other phones to a BES, with phones like a recent Motorola Razr and the Galaxy Nexus, the iPhone I think, supporting strong encryption, the heat is on the BES, heavily. It is not cheap, you might want to run it on a separate server, only 75 users per server, versus Google Apps for Business with Vault… yeah I’m leaning toward your side. But what I said in this article will be long forgotten by the time I’m proven wrong and Blackberry does indeed die.
Not to make this about Google versus all the alternatives to RIM’s goods but check this site out.
That’s the point. For an Exchange environment to support Blackberry, they have to add a BES server that is like a mail filter. It’s expensive, antiquated and interferes with ALL corporate email, not just the Blackberry dinosaurs. Exchange has activesync built in and doesn’t care what phone you have since Android, iPhone, Windows Phone, Nokia, and EVERYBODY ELSE supports it. NO outrageous BES license and fees, no additional server to support, no month long outages a few times a year. Blackberry NEEDS to die.
Blackberry licensing is expensive and supporting it is a PITA. I can count over 50 companies I deal with personally who have ripped out their equipment with glee for a savings of hundreds of thousands a year… PER COMPANY.
If Blackberry wants to survive, they need to license Activesync and give up on their BES that NOBODY wants to support anymore. They are no longer the only game in town. They are the game nobody wants to play.
So, what about Barracuda spam filters, are they on death row too? Why is there a market for them still, doesn’t Exchange have sufficient anti-spam capabilities?
For the companies that may be candidates for thinking they need a BES/Blackberry setup, those heavy licenses and the extra servers and UPSs and electricity and air conditioning and an IT guy or two who knows his way around a BES are less of a turnoff than they are to the rest of the world that would be fine and dandy conducting business with Google Apps and Office365.
The competition against BES is definitely heating up and improving. Several articles have been written in the past few days about how pretty much all the advantages RIM held are now gone and its only really getting the CTOs and IT guys to be aware of that.
As long as there needs to be things kept confidential there will be room for phones without cameras and other advanced hardware. RIM shrinking to better position itself for these types of niche markets should be the best outcome.
OK, Doug has finally shown his goal, to promote Blackberry at all costs.
Doug, spam filters have a PURPOSE and are necessary (as an Exchange admin I’m fully aware of that fact and as an ex-BES admin I’m fully aware of their mess). BES isn’t necessary and email is delivered much faster (to all users, not just mobile users) without it’s presence. FACT.
Please explain to your readers how much the per user license fee for Blackberry is as well as the BES licensing (all of it). Now tack on the additional costs from carriers and we’re talking DOUBLING the costs of per user mobile fees. I haven’t gotten into the server hardware, bandwidth, additional man hours, Microsoft licensing for the OS, antivirus, etc. In an environment where companies are looking to cut costs and reduce needless administration and servers, why would ANYONE pick BES over the free, already running, no additional management, 90% of the users Activesync? Activesync also provides better security, delivers the messages faster, and there’s zero chance of a 3 month outage of NO email (Blackberry wouldn’t even try to make that claim with a straight face).
As far as always seeing Blackberry devices at mobile stores, I’ll take that bet. I can give you addresses to dozens in the Chicago-land area where they stopped carrying them years ago. Reason, nobody asks for them anymore. And why Blackberry even attempts to design new phones is anybody’s guess. They all look the same and they all suffer the fewest apps of any app store. They are boring and running on an antiquated OS with minimal functionality.
Like I said, if they want to survive (not dominate, just survive) they need to give up on the BES idea and go with the industry standard ActiveSync and pick an OS that has some traction (Windows Phone 8 would be there best bet).
@Murani – IT guys have known BES was dead since the day ActiveSync was unveiled. It’s only now that the technology challenged CEO’s that once depended on them are listening. They can’t defend the costs.
BlackBerry’s pretty interesting. I got to try their cool touch phone (forgot the name) back a year or two, and I thought that was the coolest thing the way the screen could “click”, and even cooler with the “double click” when you were typing with the “shift” key – that was impressive. That’s about all though – like Windows Mobile, nobody releases much software for it anymore. As much as we might dislike touchscreens on these devices, sometimes they’re the only way to precisely control today’s smartphones, and BlackBerry doesn’t seem to implement this as well in the software.
The way I see it infact, BlackBerry is about as relevant as Windows Mobile is today. All the software is released on Android or even shoehorned onto Apple OS because that’s what everyone’s buying. One thing’s for sure, the next few years should be very interesting, maybe there’s even room to introduce a new competitor into the mix?
Do you mean Windows Mobile (which is long dead) or Windows Phone? If you are referring to Windows Phone, you couldn’t be more wrong. It has over 100,000 apps and reached that number faster than iOS or Android did. Windows Phone is an up and comer. Blackberry’s app store has practically no apps. Blackberry hasn’t been a player in the market for about 5 years. Nobody is excited about their product launches or new hardware (their tablet would be a good recent example).
As far as the new competitor, I think we’re going to see it next year. Samsung looks to be ditching Android and going rogue. We’ll see if they actually do but it’s looking that way right now.
> Doug has finally shown his goal, to promote Blackberry
McKale, you got me, I blew my cover as a RIM sympathizer/apologist/evangelist. A shame, I put some effort into flying under the radar:
I have no pro-Blackberry agenda. C’mon. I have about as much disdain for the phones, the BES and how the company swandove off the throne as you do. Another company I don’t care for? AT&T. I’ve never owned a Blackberry until being forced to use one and I never leave home without at least one Nexus on me. I simply disagree with the others that the company and the world’s general reliance on its products and services is evaporating as quickly as everyone else does, which is somewhat of a reversal from every other reference I’ve made to the company’s stock (short it).
We’ve both been feeling this way for years about rim and the bes and the shitty phones no one wants to use (IE not rooting for them to continue to exist) yet they are still surrounding us, here they are. All I am saying is that Nokia is the very effed company, and the imminence of the death of rim is somewhat exaggerated especially by you and your IT buddies.
I’d like to think that eventually the best product will prevail. As you said, bes competitors are approaching parity feature-wise, just need those CTOs to wake up to that, a process that is being lubed up by strong ubiquitous consumer demand for phones and iPads that are not Blackberries. But this will never turn into a webOS situation, which is a speculation, but that’s what I do on Sundays.
I know it’s very expensive. I could do a whole article and not fully cover the costs that go into suiting up your company with Blackberries and you’d still be able to call me out on half the things I missed. But the costs tend to sort of blend in comfortably in the overhead of its patrons, particularly those organizations which are paranoid about the leaking of internal information. There are a lot of those scattered about and they don’t really care that the CEO wants to play Angry Birds and read internal documents using Dropbox on his iPad.
RIM, Blackberry and BES are brands that have cemented themselves in the minds as the suck-it-up and use them things in enough minds to keep things afloat for them for the indefinite future. If we’re not going to bash Nokia, which is skidding just a dash over bankruptcy with people saying Well Microsoft will throw them a lifeline, live tiles and nobody likes Blackberries… RIM is not going uphill obviously but it’s too early to stick a fork in the Blackberry.
If it makes you feel any better, there’s no company I hate more than AT&T. They have single handedly killed Windows Phone in the US by being the self-proclaimed PREMIER PARTNER. Their refusal to give updates to Windows Phone and Android only hurt their customers, which they don’t care about. I will never, EVER have my personal SIM card in an iPhone (yes, sadly I’m an AT&T customer and have been for 15+ years). That being said, Apple knew what they were doing when they took the power of updates out of the hands of AT&T. THEY KNEW how evil they are.
Blackberry has one thing going for it and it’s the name/reputation of being the GO TO corporate phone. I can’t tell you how many times I’ve had a random president or vice president come to me and tell me we HAD to support blackberry devices. After sitting down with them and explaining the maintenance, the hardware, the licensing, the individual device’s fees, the limited functionality, the complete lack of cool devices, etc. etc. they grudgingly walk away defeated. I then help them pick a device that will do what THEY want that fits them.
I had one VP who had a T-Moble Dash with our Exchange platform leave the company and go to work for a Fortune 500 and they got the Blackberry they asked for. Their first comment when they came back to visit was they would take that T-Mobile Dash back in a heartbeat if it were an option. They HATE Blackberry after finally using it.
Back in the day, Blackberry was the corporate email king. Unfortunately for them, Exchange 2003 brought ActiveSync and they never properly responded. They pretended it wasn’t a threat. I’m being dead serious, the best they do with their company at this point is to become just another phone manufacturer with some custom apps over an OS that they license. Or I supposed they can just sit back and become patent trolls with their collection of patents. But that won’t last very long to keep them afloat.
In summary, AT&T is evil.
@McHale – I’ll believe that when they get above 4% marketshare.
Had AT&T not gone out of it’s way to kill it, it would have been. The only thing hurting Windows Phone is people not trying it. I have two friends that did the Windows Phone challenge to get a free Windows Phone. They have since given up iPhone 4s’ and have begun telling others how great it is. One was a die hard Apple fanboy and the other was secure with Android. It will eventually gain marketshare. Microsoft has a LOT of money to make sure that happens. IMHO it’s certainly the better OS. Try it, you’ll like it!
@McHale – Like I said, it won’t gain marketshare. If that was for some reason gonna happen, it would’ve already happened. It is not the better OS unless you’re an impatient teen or senior citizen who doesn’t want to do much work to have a working device there. I’ve done my homework and have a Samsung Epic that can do more than any Apple or WM7 crap. The functionality just isn’t there.