RIM Has No Idea What They’re Doing With The PlayBook (Or Anything)

“There’s the science part of it that led them to 7 inches and we took the human factor side and in the end agreed very quickly.”

The above quote was taken from an interview with RIM’s Vice President of Industrial Design, speaking on the 7″ form factor of their new Playbook tablet. I don’t know about you, but when I’m considering buying a tablet, the very first thing I think of is “the human factor side”.

It’s not, in itself, a bad thing. Any given quote can be taken out of context to make it seem like a company doesn’t know what it’s doing. What’s concerning is the answers that Co-CEO (and we wonder why a snake with two heads has a confused sense of direction) Jim Balsille gives for why people should buy the Playbook. Reasons like “we have a 3G version coming soon” and “it will eventually run Android apps.”

Do you know what also runs Android apps, my friend? Android tablets. I’ve got one here. Would you like to see it? It’s nice. It’s not flying off the shelves, though. In fact, as someone who owns and loves his Xoom, I can tell you the last thing that I’d tell people is amazing about it is the apps. Yet. I’m excited about the potential, don’t get me wrong, but where it’s at right now, the “Featured Tablet Apps” section of the Market is still sprinkled with apps that weren’t even designed for a tablet.

Speaking of, how are you going to get those Android apps on your device? You’re not going to get the Market. That’s simply not going to happen. So what’s your plan? The Amazon App Store? Tell customers to bring their own apks? Is this something you expect to go over well with consumers?

Oh, and then there’s this lovely little gem:

“A lot of the people that want this want a secure and free extension of their BlackBerry.”

This was the Co-CEO talking about how existing Blackberry users want to be able to pair their existing Blackberries to their tablets. Disregarding the fact that, at the moment, this is the only way for a Playbook user to use email outside of Bridge, the RIM Co-CEO seems to be suffering from one very misguided idea. And I’d like to address the executive on that if I may:

You’re not going to win your marketshare back in the phone space by building a tablet for your existing customers.

In all honesty, I can’t fathom the strategy that is going into this. RIM marketshare is plummeting. This is not an arguable idea. It’s fact. RIM once dominated the smartphone market. In the U.S. alone, they had 43% of the smartphone market last year. What happened? Well, let’s look at some data:

According to comScore, in January of 2010, RIM had 43% of the smartphone market, a market which had 42.7 million smartphone users. Fast-forward to July of 2010, and they’re down to 39.3% marketshare in the U.S.. However, that is 39.4% of a now 53.4 million user market. The market itself has increased by about 25%. In terms of sheer users, despite losing marketshare, RIM actually gained total users. Take a look:

In terms of actual RIM users, they were actually gaining for much of last year. And by a pretty striking amount. In fact, between July 2010 and February 2011, a period which we’ll note saw the advent of the iPhone 4, the Evo, the Droid X, the entire Galaxy S line, and the brand new WP7 platform, RIM only lost about 800,000 users. To put that in perspective, Apple sold 1.7 million phones during the (first) opening weekend of the iPhone 4, and Android currently activates 350,000 devices daily (or roughly 2.5 million devices weekly). Is it bad for a platform when it loses users? Of course. But given how aggressively the iPhone and Android are pursuing their onslaught, the fact that it took seven months for Blackberry to lose only 800,000 users is nothing short of surprising.

So, what’s happening then? Why is RIM getting such a bad rap lately? To put it quite simply, they’re targeting their devices, their platform, everything they’re doing, squarely at their current userbase. They think they’re reaching out to new demographics, but they’re doing it while still leaving one foot inside their home base. They’re terrified to actually branch out and alienate their current users. They believe, as many critics do, that they’re losing their users. And, to a degree, that’s true. However, the much, much, much bigger problem is that they are not gaining users from anywhere else. To be clear: Android and the iPhone are not eating away at RIM’s marketshare because they’re taking Blackberry users away, they’re eating away RIM’s marketshare because they’re growing the market outside of the demographics RIM usually targets.

And this problem of learning who to target is a problem RIM has had for a while. For years, Blackberries appealed to the business-y suit types. And it’s worked well for them! They achieved an overwhelming majority of a small market. But now that market is growing. It includes folks young and old, wealthy and poor. And yes, ok, they like Twitter and Facebook. But it’s not like they get excited at the words. I like Twitter. I use it everyday. I loathe to actually say those words because even to a guy like me, saying “I tweeted about that” sounds childish. I can’t deny the utility of the service, but I don’t crap my pants when someone says “This thing does Twitter!” And, for that matter RIM, everything does Twitter now. It’s part of what made Twitter so popular so quickly, that you could use it from just about any device that had an internet connection. Don’t use Twitter as a sales point.

RIM needs to figure out who they’re marketing towards and fast. They’ve needed to do this a while. They think they’re doing it. They’re not.

And here’s the thing, RIM. It’s perfectly ok if you don’t get your act together on this. You have a loyal fanbase. Clearly. Until you do what Microsoft and Nokia did and just outright pull the plug on your platform, you will have people ready and willing to buy your devices for a while to come. The smartphone market is still immature, despite its thriving vibrance. As of February 2011, only 70 million U.S. users have smartphones. Less than a fourth of Americans. And the worldwide market? Even fewer. There’s plenty of room for everyone. For now, at least. But your problem is not that you’re losing your current customers. And designing a tablet to be used in tandem with your phones is not going to keep the few that are leaving. And supporting Android apps in a roundabout way is not going to get people to buy your tablet instead of any of the myriad of Android tablets that are about to be available.

You want to win over new demographics? Do something different. Google brought in a hyper-connected platform with free map/navigation software. Apple created a smartphone that is clean, high-quality, and simple to use. Microsoft made the gutsy move of ditching their entire old platform to create a new one with a brilliant interface and a controlled ecosystem designed to allow for hardware differentiation from a variety of manufacturers while keeping quality high. What’s your hook? You put a touchscreen on the Bold? Your tablet will eventually have 3G? No. Guys. Come on.

Do something new. Take a risk. Something. Because it’s not your current consumers you need to convince. It’s the rest of us. And so far? We’re unimpressed.

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Source: Bloomberg