Canadian carriers key to RIM product launch
Interest ‘very high’ in Blackberry 10, Rogers exec says
TORONTO — BlackBerry Messenger, the nifty and efficient personal-messaging service that’s become so important to bracing Research In Motion Ltd.’s fatigued appeal in these trying times, may just owe its existence to a local telecom outfit.
“There was a point there where RIM said they were thinking about getting out of BBM,” John Boynton, chief marketing officer at Rogers Communications Inc., recalls. “We said, ‘No, no! We think it’s great.’ ”
It was the early 2000s and Rogers’s growing employee base had become hooked on the service it was supposed to be selling, becoming the single largest organization using BlackBerry Messenger in the world, the executive said.
BBM, which glided into the allimportant consumer segment more easily than BlackBerry as a whole (as popular with teens as with lawyers), is set for a major facelift in a matter of days when the company launches its epoch-shifting new operating platform, BB10.
Not surprisingly, RIM shares a long history with Canadian carriers, which RIM executives say is being relied on for a successful launch. Among operators here, perhaps the most important is the country’s largest. Rogers was the first in the world to commercially go to market with the technology giant’s early devices more than a decade ago: boxy, rectangular handsets with pixelated icons that sent emails to one another.
“It’s a great Canadian story. A couple of guys (former co-CEOs Jim Balsillie and Mike Lazaridis) in Kitchener had this paging technology on these little square devices,” Boynton said, admitting that at first, it was a “tough sell.”
It took RIM half a decade, between 1999 and 2004, to amass its first million users. Early clients were at first confounded by the technology, writing it off as glorified paging. That would change rapidly.
RIM’s second million came in a matter of months. Then came a crush of orders from Canadian and U.S. corporate and government departments. The company’s secure and stable software had hit an inflection point by late 2004, with so-called enterprise users igniting RIM’s surge into a global powerhouse.
At home, the BlackBerry’s sudden rise catapulted Rogers over competitors BCE Inc. and Telus Corp. in the enterprise market, establishing both the carrier and RIM as the unparalleled wireless service of choice for corporate Canada and government, a crucial success story RIM was able to leverage with larger carriers the world over.”
RIM has grown its subscriber base to 79 million since.
Andrew MacLeod, RIM’s country director for Canada, said in a recent interview that RIM is banking on “strong and healthy” relationships with Rogers, BCE, Telus and regional carriers Wind, Videotron and Mobilicity to heavily promote the new product line.
“BlackBerry, in many ways, got its start with these wonderful relationships we have with the Canadian carriers,” the executive said.
Sheer economics are also playing an important role. Canadian carriers, like others in mature mobile markets like the United States, often cover a portion of the upfront costs on devices in exchange for customer’s signing multi-year contracts. A resurgent RIM will help lower device costs as the firm competes for carrier orders with Apple and handset makers supporting Google’s Android platform.
“I think the Canadian carriers, much like many other carriers around the world, are looking at the evolving smartphone (operating system) landscape, I think it’s very much in their interest to see a very strong and viable, diverse ecosystem,” MacLeod said. “In order to achieve that, you need multiple players. So it’s in their interest to ensure that the BlackBerry OS continues to be very strong.”
Whether RIM can execute on a turnaround and begin to reclaim lost ground and market share pivots on a successful early launch in Canada and elsewhere, analysts say. If the early uptake is there, it could trigger a self-reinforcing barrage of marketing at the carrier level to capitalize on the pent-up demand until it’s exhausted.
“If they (carriers) see strong interest in the first few days or weeks of launch, some positive uptake whether it’s consumer or enterprise, they’ll put more resources behind it to move RIM back up the pecking order,” Jeff Fan, telecom analyst at Scotia Capital, said.
“Our BlackBerry customers continue to want to upgrade to another BlackBerry. And interest in BB10 is very high,” Rogers’s Boynton said. “There’s a combination of intent and awareness, that’s a decent sign.”