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How the Blackberry became indispensable — and then disappeared


Back in the 1990s, long before the pandemic made remote work the new normal, a few tech geeks at a Canadian company named Research In Motion, working out of a cramped office space in Waterloo, Ontario — under the leadership of founder Michael Lazaridis and CEO Jim Balsillie — all but invented the concept.

Right around the turn of the century, they created the world’s smallest portable email terminal — an internet-enabled handheld that came complete with full keyboard.

Soon, they figured out how to turn the thing into a cellphone, and the world’s first truly smart phone, the BlackBerry, was born in 2002.

“There clearly was a massive hunger for it — BlackBerry broke the doors open,” Matt Johnson, director of “BlackBerry,” a film that chronicles the rise and fall of the tech titan, in theaters Friday — told The Post.


Jim Balsillie (left) and Mike Lazaridis revolutionized the tech world with the BlackBerry.
REUTERS

BlackBerry phones quickly changed the tech landscape.
BlackBerry phones quickly changed the tech landscape.
Europa Press via Getty Images

“Other people were trying to do email on a phone at the same time, but their products weren’t robust.”

The state-of-the-art tech was nicknamed “CrackBerry” because of how quickly the world became addicted. However, as notable as the device’s game-changing qualities was the business savvy of RIM honchos Balsillie (Glenn Howerton) and Lazaridis (Jay Baruchel), both determined to profit handsomely from their creation.

BlackBerry’s business-forward strategy paid off — at first.

“BlackBerry would sell their devices to individual users and then that user would have a deal with their local carrier to have access to the network. BlackBerry would charge you a surcharge on top of that, just to use that phone,” said Johnson, who also plays RIM co-founder Douglas Fregin in the film.

“Imagine that to use your iPhone, you need to pay a special iPhone fee. These guys were making buckets of money renting network space to these users.”

From the time it hit the market up to the crushing blow delivered by Apple’s iPhone in 2007, BlackBerry was the cream of the tech crop, controlling a whopping half of the smartphone market in the U.S. and 20% globally. RIM enjoyed a market value of $230 per share at its peak.

The tech-cessory quickly became a fixture with boldfacers like President Barack Obama, Anna Wintour, Sarah Jessica Parker and Katy Perry — who tried a BlackBerry and liked it.


President Barack Obama was one of the world's most visible BlackBerry users during the device's heyday.
President Barack Obama was one of the world’s most visible BlackBerry users during the device’s heyday.
Getty Images

Vogue's Anna Wintour was rarely seen without her device at the time.
Vogue’s Anna Wintour was rarely seen without her ‘Berry at the time.
Getty Images

Katy Perry tried a BlackBerry — and liked it.
Katy Perry tried a BlackBerry — and liked it.
INFphoto.com

But while the BlackBerry product was indisputably top of the line, there was no shortage of competition — starting with Palm, parent company of the PalmPilot, which had its own celebrity following, including Michael Jordan and Claudia Schiffer.

Palm was hungry for a taste of BlackBerry — before the phone was even out, CEO Carl Yankowski was planning a hostile takeover of RIM, according to Johnson.

Yankowski invited Balsillie and Lazaridis to New York and blindsided them with his plans over dinner, but Balsillie managed to negotiate a stay of execution.


CEO Jim Basillie famously thwarted an early takeover attempt, holding off a hostile suitor until the company's stock rose.
CEO Jim Basillie famously thwarted an early takeover attempt, holding off a hostile suitor until the company’s stock rose.
Toronto Star via Getty Images

BlackBerry boosted its stock to prevent a takeover.
BlackBerry boosted its stock to prevent a takeover.
Google Finance

“Jim said, ‘Look, please don’t do that. Why don’t we just sell you the company above board.’ That way we can both win,’” Johnson said. “But of course, he’s completely lying.”

After that night, RIM spent nearly a year fending off Yankowski. They often did this just by ignoring his phone calls, angering Yankowski, who saw Balsillie as “a stupid Canadian,” according to Johnson, to the point where he was about to sue them.

Not that RIM was running and hiding — the plan was to boost company stock to the point where Palm could no longer afford a buyout. Yankowski was completely blindsided.

“All of a sudden, Jim unleashes their earnings and their stock just went completely insane. Carl no longer could buy the company. It’s a really kind of an impressive business story — holding up a hostile takeover until you can raise your stock price high enough so that you can’t be taken over,” Johnson said.

“It was a hell of a gamble.”

The thwarted takeover showed the markets Balsillie’s cunning, and that BlackBerry was truly a global force to be reckoned with.

Pride goeth before a fall


While RIM may have been great at making money, it was less spectacular at innovating — BlackBerry would soon find itself falling behind.
While RIM may have been great at making money, it was less spectacular at innovating — BlackBerry would soon find itself falling behind.
REUTERS

At RIM’s peak in 2006, the Harvard-educated Balsillie — a diehard hockey fan — tried to purchase the then financially-wrecked Pittsburgh Penguins for $175 million.

Publicly, it was a maneuver of “charity” from a lover of the game who’d dreamed of playing pro hockey as a kid, according to Johnson.

But Balsillie had ulterior motives. It was widely reported that he was likely attempting to relocate the pride of western Pennsylvania to his own backyard, industrial Hamilton, Ontario — something the NHL would never have stood for.

Once commissioner Gary Bettman and league executives discovered Balsillie’s alleged plan, the deal was put on ice — and the newly-emboldened CEO was sent to the penalty box, after a chilly in-person meeting, Johnson said.


The NHL was adamant against letting Jim Balsillie own a team.
The NHL was hellbent on preventing Jim Balsillie from acquiring one of its teams.
REUTERS

“That meeting apparently was like one of the most insane days of the NHL,” Johnson said. “I think Jim, at that point, really thought that he was going to get one over on the NHL. I think he really thought that he was going to be able to use the court system to win. When he realized that he couldn’t, it was not a pretty day.”

The exchange was supposedly so intense that the film’s legal team had to water the scene down on-screen, Johnson said.

As humiliating as the failed purchase was — along with two more shots Balsillie failed to land, trying to snap up the Nashville Predators and the then-Phoenix Coyotes — it was sandbox stuff compared to what came months later, when Apple unveiled the iPhone.


Steve Jobs and the iPhone led to the demise of BlackBerry.
Steve Jobs and the iPhone led to the demise of BlackBerry.
Getty Images

Balsillie and RIM weren’t prepared.

“At this time, he didn’t think in a million years BlackBerry was going to go under. He had this famous quote, ‘We’re going straight to the moon, or we’re crashing down hard to earth,” Johnson said. “He did not have a backup plan at all.”

BlackBerry struggled to match the new concept of a keyboardless, single-screen smartphone — and the market knew it. RIM’s BlackBerry Storm, a slapdash, hastily-released iPhone wannabe, was notorious for being highly defective and hard to operate.


Founder Mike Lazaridis and RIM created Blackberry Storm as an attempted answer to the iPhone. It was a notoriously dysfunctional phone.
Founder Mike Lazaridis and RIM created BlackBerry Storm as an attempted answer to the iPhone. It was a notoriously dysfunctional phone.
Getty Images

“It is universally regarded as the most failed product launch of all time, $500 million in return product. It’s crazy. There’s never been a product that unsuccessful, ever.”

By around 2013, the BlackBerry had gone totally rotten. Today, stock in its parent company goes for about $5 a share.

“The biggest issue that BlackBerry had is that they only looked six feet in front of their face,” Johnson said. “The iPhone looked five years into the future.”



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