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COMMUNITY Waterloo Region’s independent monthly • Vol 2 Issue 1 • October 4, 2013 • community.thecord.ca
WHAT’S NEXT? Blackberry puzzles out a new future amid job cuts and revenue losses hg watson cce editor-in-chief
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lackBerry recently announced that it has entered into a letter of intent to be sold to a consortium led by Torontobased Fairfax Financial Holdings, after posting a loss of more than $950 million in the fourth quarter. This is just the latest twist in the BlackBerry story. In its prime, the company employed more than 20,000 people and had 80 million subscribers. They were considered one of the biggest Canadian business success stories, but now layoffs and revenue losses have critics wondering if this is the end of the company and Waterloo residents are worried about the potential loss of a major employer in the community. Despite this, there are still signs that point to a positive future for one of the biggest players in Canada’s tech sector. It has left everyone wondering: what’s next for BlackBerry and Waterloo?
A wireless future BlackBerry is most often associated with their handheld smartphone devices. But the company, started by University of Waterloo graduate Mike Lazaridis and University of Windsor graduate Douglas Fregin in 1984, began life as a technology consulting firm called Research in Motion (RIM). Lazaradis had been interested in wireless communications from an early age. In a February 2013 article about RIM, The Verge
reported that Lazaridis was experimenting with transmitting text to televisions with ham radios in high school. It was this interest that eventually led him to focus on wireless technology. The breakthrough for the young company was when they successfully created a system for pagers to send messages to one another — the forerunner of texting and wireless emailing. In the years that followed, Lazaridis and his team would continue to develop their wireless device, introducing a number of small, pager-like devices on the market. It was the premiere of the BlackBerry in 1999 that really got them noticed. Jim Balsillie, who joined the company in 1992, set about getting the phones into the hands of politicians and businesspeople. “Any consumer BlackBerry uses is a spin-off from the initial user,” said Armine Yalnizyan, a senior economist at the Canadian Centre for Policy Alternatives. “Everybody wanted one so they opened it up to the consumer.” The phones offered something no other telecom company could: a sophisticated way to communicate quickly and securely. It seemed RIM could go nowhere but up — until 2007, that is, when the Apple iPhone debuted. Rather than creating a phone that would eventually trickle down to everyone, Apple created a smartphone that was accessible from the beginning. “[Apple] basically said, ‘[BlackBerry] is for
nerds. Let me give you a cool tool that you can watch video on and take pictures with and have your music on,’” said Yalnizyan. BlackBerry was slow to respond to the new challenges of the iPhone and later the Samsung Galaxy series — so slow that they doomed their own smartphone business, according to some critics. Meanwhile, their attempt to break into the tablet market in 2011 with the Playbook was met with poor reviews. That year, RIM saw the first round of major layoffs. Lazaridis was right to bet on wireless technology — but as it currently stands,
BlackBerry has been muscled out by sleeker, more user-friendly mobile models. In December 2005, BlackBerry held more than 20 per cent of the United States mobile market. In December 2012, it had fallen to about five per cent.
Job losses – now and for the future In Waterloo, the many people who rely on BlackBerry for income have most keenly feel the blow. More than 10,000 employees have Continued on page 6 >>