NOTE: My original post, originally published in January 2013, continues to be one of the most viewed on the site. Android and Apple have enjoyed an estimated 98% market share between the two, and many of my earlier projections regarding this market appear to have been borne out. However, the smartphone market has now matured to the point that it is at a strategic inflection point which has major implications for the future of this market and the major competitors. The rapid maturation of the smartphone market should have been foreseen: the rise of domestic Chinese competition combined with the predictable end of the Western consumer fascination with “the next smartphone”
It dawned on me that my blog post from July 2013, still has particular relevance to the current situation in Canada. I discuss the longer term structural issues confronting Canadian entrepreneurs and Canadian venture capital. When I first arrived in Canada in 1989, I learned quickly that the Vancouver startup ecosystem was nothing like what I knew from Silicon Valley.
This is another on my series on industry analysis. The recent University of Ottawa study on the demise of Nortel Networks, tells us what many of us already knew. The most important constructive criticism of this study is that it should have been done years ago. The Nortel collapse was followed by a surprisingly similar scenario at RIM, now Blackberry. Mike Lazaridis, who served as RIM’s co-CEO along with Jim Balsillie until January, 2012, are generally considered to have failed to respond adequately to the market encroachments of Apple’s iPhone and Google’s Android phones, as Blackberry’s market share plummeted. I recently showed my undergrad and graduate strategy students a video of a Charlie Rose interview with John Chambers, CEO of Cisco Systems. Chambers emphasized the acceleration of the Adizes corporate life cycle, in many cases to less than ten years, and the need for constant reinvention to survive in this challenging and rapidly changingnew world.
No part of the tech job market is more insane than the fight for interns. A few of my UBC Faculty of Management students have recently been very fortunate to land internship jobs with excellent high tech firms based both in Silicon Valley and in the Lower Mainland. The more industrious and resourceful UBC students should use these network connections to compete for their dream internship or first job.
The sale and breakup of a flagship technology company is a reoccurring theme in Canadian business. But this time is different. If BlackBerry Ltd.goes, there is no ready replacement. That’s a telling switch from the situation Canada faced with the sale of Newbridge Networks in 2000 and the demise of Nortel Networks in 2009. More than a decade of declining business investment in research and development has left Canada without an obvious BlackBerry successor. Despite bright spots in Waterloo, Ont., and Ottawa, the country’s performance on most of the important benchmarks of innovation has been deteriorating for years.
Readers of this blog will recall last week’s post on the International Data Corporation’s (IDC) report on the mobile phone market. The problems for both Microsoft and Blackberry were exposed again for all to see. Microsoft’s Windows Phone market share at 3.7%, would have been even smaller without Nokia. Blackberry’s situation was even more dire. A few months back Microsoft and Blackberry opened another new patent war on each other, as if this would somehow help their situations.
This week Blackberry has announced the inevitable search for a potential buyer to take the company private, as has also happened recently with Dell Computer. The suggestion that Ballmer and Microsoft should consider purchasing Blackberry is actually a potentially very interesting idea. A broader market consolidation, with much larger implications, may be on the horizon.
Students of Industry Analysis will note the importance of high technology industry analysis firms, like International Data Corporation (IDC), which this week issued its quarterly reports on the state of key technology markets. The report has been seized upon, sliced and diced by the Wall Street Journal, and a host of other media sources. The technology blogosphere is alive with comment, PandoDaily, Gigaom, TechCrunch, Gizmodo have all been furiously offering their own spins on the IDC Report. It is amazing to see so much of the industry talking about nothing else but IDC today. Similar firms like Forrester, Gartner and others offer similar industry analysis reports, but IDC is the big dog, and the mobile market is their dog food.