Whither Blackberry?

Samsung and Apple are winning the war of smartphones (through different strategies...Apple through a single elegant phone built on its proprietary OS and Samsung through a rapid launch of a  slew of multiple sized devices built on Android). The chart above is taken from a recent Time article.

In the meanwhile, RIMM (and its Blackberry) are losing traction rapidly. Its share of worldwide smartphone shipments dipped from 13.6% to 6.7% in a year's time! Looks like their attempt to get the general populace into the Blackberry Boys' club has not worked.

Given that most folks replace their phone every 2-3 years, RIMM could quickly lose its installed base around the world.

What should it do now?

I suggest the following options:

1) Open up Blackberry Messenger (BBM) by tying up with Yahoo and Google so that Blackberry users can message any Yahoo Messenger and Google user (and vice-versa). BBM is still the big draw for many die-hard Blackberry fans.

2) Woo VoIP developers (such as Skype) to develop a VoIP application for Blackberry OS.

3) Figure out a way to marry BBM and Blackberry email with the Android platform. RIMM will gain access to the myriad of apps for the Android platform and Blackberry users will love RIMM for it.

4) Sell the company to any leading PC manufacturer (HP, Dell, etc) who are lusting for a position in the smartphones/ tablets space. RIMM has relationships with leading mobile carriers around the world. This is a big asset for any newcomer (or marginal player) in the smartphones business. Though this is a drastic move, RIMM is trading at just 6 times earnings and can get a good premium by selling.

... phone?... tablet PC?... No it's a Dell Streak Part 2

I have commented earlier on Dell's mobile device strategy (click here) and on the Dell Streak (click here).

Today Walt Mossberg reviewed the Dell Streak (click here) in the Wall Street Journal. Some salient points:

• I couldn’t find, and Dell couldn’t identify, any apps written especially for its larger screen. In fact, a few Android apps I tested seemed to crowd all their icons into just a portion of the Streak’s screen, especially when the device was held vertically, leaving lots of white space.

• It’s much lighter than the iPad, at just under half a pound, but heavier than many smartphones. In my tests, I found I could carry the Streak comfortably in the pocket of loose jeans, or in a suit jacket’s inner pocket, but not in a shirt pocket or the pocket of more fitted pants. It would take up a lot of room in a small or medium-size woman’s handbag. And it looks somewhat ridiculous when held up to the ear to make a phone call.

• When held horizontally, the screen felt luxurious, with lots of room, and good sharpness and color, for playing video or viewing photos. Even in portrait mode, reading books using the Amazon Kindle app was a much better experience than on any smartphone I’ve tested, though not nearly as good as on the iPad or Kindle e-reader.

• Its 5-megapixel rear camera took sharp photos and fair videos, and phone calls sounded clear. The large screen was a big plus for Google’s free voice-prompted navigation app. Battery life was very good, easily lasting a full day, and the battery is removable.

• But the Streak also crashed on me several times. On one occasion, it started vibrating endlessly, only stopping when I removed and replaced the battery.

• The device has a front-facing camera—unlike the iPad, which has no camera at all. But video calling isn’t integrated, unlike on the new iPhone, and requires you to sign up for a third-party service.

• Twice the device proclaimed it couldn’t find the memory card and had to be restarted before it could. Twice, the YouTube app failed to load any content.

• Also, the buttons on the top edge for turning the Streak on and off and for taking pictures are very close together and easily confused for each other. And the camera button eventually stopped working for me altogether. The speaker, located on the back, sounded tinny when playing music. And it was too easy to block the rear camera with a thumb or finger when holding the Streak naturally.

• Dell sees the Streak as a tablet first, with phone calling as a secondary function. It may well appeal to people for whom the iPad is too large to carry around, yet want some of the tablet experience coupled with a phone. But tweener devices can be hard to love and Streak buyers will have to overlook some of the shortcomings I encountered.

No one says it better than Walt.

Is it a phone? Is it a tablet PC?... No it's a Dell Streak

Dell Streak has launched in the UK and will soon be launched in the US. Here is the product page from the Dell UK website (click here) and a much better product page on the O2 UK website (click here). Here's a more instructional blog post from Dell (click here).

I had blogged in January 2009 (click here) about Dell's entry into smartphones. I had said then that Dell would find it a difficult business plan to pull off. It's time to revisit that assessment. (Of course, Streak is a cross between a smartphone and a tablet PC, not just a smartphone, but lets park that for now).

I was able to see a real-life demo of the Streak (don't ask how) and was impressed by the clarity of the display and the compact form factor.

Here's what works in the Streak's favor (or 'favour' if you are from the UK):

• It has a 5 inch screen as compared to the 3.5 inch screen of the iPhone4
  
• Dell Streak is based on the Android platform, which is an open platform, as opposed to the Apple platform.
• The Streak has a Gorilla glass display that prevents scratches.
• It is priced more attractively than the iPhone 4 (GBP 399 with Pay as you go compared to GBP 470 for the iPhone; On O2 it is free with a GBP 25 plan as opposed to a GBP 60 plan for the iPhone4)

Here's what works against it:

• Should I compare Streak with iPhone or iPad? Is there really a white space between a smartphone and a tablet computer?
• The brand pull of iPhone, iTunes and Steve Jobs
• iPhone4 has Retina Display.... one can read a significant part of a newspaper page on the 3.5" screen without squinting
• iPhone4 has video calling whereas the Streak does not

I still think Dell Streak will find it difficult to crack the US mobile market. Here's what Dell needs to do (to pose a serious challenge to Apple in this space):

• Don't launch exclusively on AT&T. Go for T-mobile, Verizon Mobile, Sprint, also so that you are not competing head-on with iPhone4.
  
• Clean up the Dell website to give more focus to the Streak. Currently you have to click 3-4 times to know that Dell sells mobile phones too. Maybe they should launch a separate product website for the Streak.
• The website needs to have more video on how the phone looks and feels. They should show how apps looks on the phone when they run... In PCs that is not critical as most potential customers have worked on PCs before.
  
• Currently Dell sells rival mobile phones (Samsung, HTC, etc) including some Android models. They need to be clear whether they want to sell Streak or help their rivals sell their smartphones.

I still feel it is difficult for Dell to pull this off....but I'll wait to be surprised.

Dell's smartphone strategy.....Are they dialling the wrong number?

The Wall Street Journal reported that Dell has been working for over a year on Android and Windows-based smartphone designs (click here). WSJ claims that Dell has been meeting component manufacturers, software vendors and handset manufacturers for its smartphone project.

CNet's Crave blog (click here) quotes Jeff Kagan, a reputed telecom analyst, saying that the smartphone market is likely growing at 10-15% after growing more than 50% till recently. The folks at Canalys even think that the US smartphone market grew more than 100% till Q3'08 (click here).

RIM, Apple and Nokia dominate the high-end of the smartphone market. Between them they account for 71% of the global smartphone market (Nokia 39%, Apple 17%, RIM 15%). All the other handset manufacturers (Palm, HTC, Motorola, Samsung, Sony Ericsson, etc) make up the remaining 29%. Incidentally the Windows and the Android platform account for less than 15% of the market.

I wonder: Is it a good idea for Dell to launch their own Windows/ Android smartphone?

I think it would be a difficult business case to pull off. Here's why:

• Buyers of an iphone, Blackberry or the Nokia E71 are brand sensitive and are not likely to be seeking the cheapest smartphone available. Dell will have to spend significantly in marketing and product development if it wants to have a serious chance in the high-end of the smartphone market.
• Unlike servers or printers, people who buy PCs are not likely to be buying mobile phones at the same time. Thus having a full product line does not give any strategic advantage. The last time Dell tried to establish a brand in the consumer electronics space (by making MP3 players), it ended up badly (click here).
  
• Dell's traditional strength has been online direct selling of PCs. Mobile phones are already being sold online and Dell brings nothing new to the table on that front. Moreover in the US market, Dell will have to deal with each of the mobile carriers to sell its smartphones (Apple has done that successfully but then they had a hotttt product and they had Steve Jobs).

I would love to hear your thoughts...