Summary:
When Smartphone Markets Converge, Consumers Not Businesses Set the Standard
Nokia, once the global leader in mobile phones, missed the smartphone market. Blackberry finds itself on the ropes after misjudging how smartphones would open cracks in its stronghold with business users. Building a dominant position in the business market is crucial for both Nokia and BlackBerry as they fight for survival since Apple and Samsung have built dominant positions in the consumer smartphone market. Unfortunately, Apple and Samsung and are now targeting business users.
In targeting Blackberry's stronghold, Nokia is betting its partnership with corporate-computing giant Microsoft will help it win business users. Nokia, as the biggest seller of handsets running Windows, is trying to appeal to IT chiefs seeking easy synchronization between smartphones and company computers, which most often use Microsoft’s operating system.
Unfortunately for Nokia and Blackberry, the iPhone and Android have already captured a combined 78% of the business- smartphone market in 2012. BlackBerry 16%. Nokia 4%. The reality is Blackberry missed the impact people choosing their own phones for use at work, and they were choosing Apple and Samsung, would have on its business.
Classic Case of Disruption: Consumer Smartphones Ultimately Become Smart & Secure Enough for Business Users
Apple and Samsung are not standing still. In January 2012, Samsung, acquired a stake in security software company Fixmo Inc. In February 2013, Samsung introduced its Knox security software, which it teamed up with General Dynamics, a military contractor, to develop to ensure its phones met the strict security standards of government agencies.
As tablet computers become more commonplace, the company which is strong in both tablets and smartphones will have an advantage with business customers. This favors Apple and Samsung over Nokia and Blackberry.
Third Ecosystems Rarely Exist in Operating Software
Nokia insists there can be a “third ecosystem” in the smartphone business. Unlikely. Smartphones are smart because of the software. In every other software business, especially operating systems, one or two become dominant and everyone else is relegated to a small niche on the sideline. Think Windows and Apple for computers. Of the two dominant software systems, one is an open system (e.g. Windows), and the other is proprietary (e.g. Apple). Symbian, Nokia's own attempt at a smartphone operating system, was unsuccessful for several reasons. Symbian was late to the party after iOS and Android. Google gave Android away and Nokia stuck to charging royalties. The result is iPhones and Android devices together account for about 90% of smartphone sales. Blackberry 3.2%.
Blackberry Missed Being Disrupted Because it Mis-Defined the Market's Needs
BlackBerry insist the BlackBerry is still the top phone for professionals. And yet in 2012, according to IDC, Android phones and Apple iPhones replaced BlackBerrys as the most-used phones among workers all over the world. More businesses are buying iPhones for their employees. Android phones the most popular among workers buying their own phones. Nokia and Blackberry are competing for a far distant third place after Samsung and Apple in both the consumer and business smartphone markets.
Will Blackberry be the Next Iridium?
If Blackberry is not acquired by Nokia, it will likely go the route of Iridium, which was re-built targeting use in environments and locations other phones could not reliably provide service to. Blackberry may become the dominant niche in corporate and government communications requiring THE ultra-secure network. But this will be a small market.
Sources:
CKB Solutions is all about real solutions for the real world. To learn how we can help your business, contact Greg Kovacic in Hong Kong.
- Nokia lost the consumer smartphone market to Apple and Samsung/Android.
- Nokia is targeting Blackberry's business customers in its bid for survival.
- Samsung and Apple are also targeting Blackberry's business customers.
- Nokia is betting on a third software ecosystem for smartphones. The history of the software market shows this rarely happens in mass markets.
- When smartphone markets converge, consumers not businesses set the standard.
When Smartphone Markets Converge, Consumers Not Businesses Set the Standard
Nokia, once the global leader in mobile phones, missed the smartphone market. Blackberry finds itself on the ropes after misjudging how smartphones would open cracks in its stronghold with business users. Building a dominant position in the business market is crucial for both Nokia and BlackBerry as they fight for survival since Apple and Samsung have built dominant positions in the consumer smartphone market. Unfortunately, Apple and Samsung and are now targeting business users.
In targeting Blackberry's stronghold, Nokia is betting its partnership with corporate-computing giant Microsoft will help it win business users. Nokia, as the biggest seller of handsets running Windows, is trying to appeal to IT chiefs seeking easy synchronization between smartphones and company computers, which most often use Microsoft’s operating system.
Unfortunately for Nokia and Blackberry, the iPhone and Android have already captured a combined 78% of the business- smartphone market in 2012. BlackBerry 16%. Nokia 4%. The reality is Blackberry missed the impact people choosing their own phones for use at work, and they were choosing Apple and Samsung, would have on its business.
Classic Case of Disruption: Consumer Smartphones Ultimately Become Smart & Secure Enough for Business Users
Apple and Samsung are not standing still. In January 2012, Samsung, acquired a stake in security software company Fixmo Inc. In February 2013, Samsung introduced its Knox security software, which it teamed up with General Dynamics, a military contractor, to develop to ensure its phones met the strict security standards of government agencies.
As tablet computers become more commonplace, the company which is strong in both tablets and smartphones will have an advantage with business customers. This favors Apple and Samsung over Nokia and Blackberry.
Third Ecosystems Rarely Exist in Operating Software
Nokia insists there can be a “third ecosystem” in the smartphone business. Unlikely. Smartphones are smart because of the software. In every other software business, especially operating systems, one or two become dominant and everyone else is relegated to a small niche on the sideline. Think Windows and Apple for computers. Of the two dominant software systems, one is an open system (e.g. Windows), and the other is proprietary (e.g. Apple). Symbian, Nokia's own attempt at a smartphone operating system, was unsuccessful for several reasons. Symbian was late to the party after iOS and Android. Google gave Android away and Nokia stuck to charging royalties. The result is iPhones and Android devices together account for about 90% of smartphone sales. Blackberry 3.2%.
Blackberry Missed Being Disrupted Because it Mis-Defined the Market's Needs
BlackBerry insist the BlackBerry is still the top phone for professionals. And yet in 2012, according to IDC, Android phones and Apple iPhones replaced BlackBerrys as the most-used phones among workers all over the world. More businesses are buying iPhones for their employees. Android phones the most popular among workers buying their own phones. Nokia and Blackberry are competing for a far distant third place after Samsung and Apple in both the consumer and business smartphone markets.
Will Blackberry be the Next Iridium?
If Blackberry is not acquired by Nokia, it will likely go the route of Iridium, which was re-built targeting use in environments and locations other phones could not reliably provide service to. Blackberry may become the dominant niche in corporate and government communications requiring THE ultra-secure network. But this will be a small market.
Sources:
- "Failing to Beat Apple, Nokia Aims for BlackBerry", Bloomberg, February 27, 2013.
http://www.bloomberg.com/news/2013-02-26/failing-to-beat-apple-nokia-aims-for-blackberry.html - "Samsung Armors Android to Take On BlackBerry", New York Times, February 27, 2013.
http://www.nytimes.com/2013/02/28/technology/samsung-armors-android-to-take-on-blackberry.html?pagewanted=all&_r=0
CKB Solutions is all about real solutions for the real world. To learn how we can help your business, contact Greg Kovacic in Hong Kong.
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