Rise and fall of BlackBerry: How the mobile phone giant destroyed itself

BlackBerry (originally Research In Motion, RIM) pioneered mobile email and smartphones in the early 2000s. Its devices, with secure messaging and iconic QWERTY keyboards, became status symbols for business and government users. RIM’s market share grew rapidly; for example, by January 2010 BlackBerry held about 43 per cent of US smartphone sales. At its peak BlackBerry counted some 41 million subscribers worldwide. BlackBerry’s early success rested on its physical keyboard and push‐email.

By the late 2000s consumer preferences shifted sharply to large touchscreen devices and rich multimedia features. BlackBerry reacted slowly. It initially dismissed the iPhone (introduced 2007) as a “toy” for consumers, and only released its first full-touchscreen model (the BlackBerry Storm) in 2008 – a device that drew criticism for poor performance and responsiveness. In fact, industry analysts noted that for years BlackBerry phone hardware changed little: “the typical BlackBerry phone…was really hard to tell…from one from five years ago”. In contrast, Apple’s iPhone and Android competitors continuously iterated on form factor, adding large, high-resolution touchscreens and sleek designs. BlackBerry’s clinging to small screens and keyboards left it unable to match the user experience of newer smartphones.

• Hardware missteps: BlackBerry insisted on QWERTY keyboards and small displays long after rivals went all-touch. Its first touchscreen models (like the 2008 Storm) proved unreliable. This reluctance to fully embrace touchscreen UIs hurt its appeal.
• OS delays: BlackBerry’s proprietary OS also lagged behind. Successive BlackBerry operating systems were slower to update and less intuitive than iOS or Android, making apps and features harder to develop. By the time BlackBerry 10 (its next-gen OS) launched in 2013, it was six years behind the iPhone – too late to regain users.

App Ecosystem and Market Focus

As Apple and Google cultivated vast app ecosystems (starting with Apple’s 2008 App Store and Google’s Android Market), BlackBerry failed to attract developers. In practical terms, iOS and Android users enjoyed tens of thousands of apps; BlackBerry’s App World had far fewer popular apps. Observers noted that BlackBerry developers lagged behind the “rapid introduction of apps” on other platforms. This limited functionality made BlackBerry devices less versatile for consumers.

BlackBerry also focused heavily on corporate and government customers, emphasizing email security and enterprise server integration. As smartphones became mainstream tools for personal use, BlackBerry’s enterprise image became a handicap. Users increasingly “expect their phones to meet both professional and personal needs,” but BlackBerry’s offerings were seen as corporate‐centric. In the hand of an individual consumer, Apple’s iPhone (and Android phones) offered not just email but rich multimedia, web browsing, music, and social apps – needs BlackBerry devices only partially addressed. BlackBerry’s failure to broaden its appeal beyond business users meant it ceded ground to phones that delivered a “single device” for both work and life.

Strategic Missteps and Internal Dynamics

Internally, BlackBerry’s leadership structure and strategy contributed to missteps. Co‑CEOs Mike Lazaridis (product visionary) and Jim Balsillie (business strategist) often clashed on priorities. In general, the company became slow to adapt its strategy as the market changed. BlackBerry at one point delayed major product launches (for example, there was a multi-month delay before the PlayBook tablet ship date) which let competitors gain ground. A notorious example was the company’s network outage in October 2011, when all BlackBerry email services went down for days – an event that shook customer confidence just as consumers were already eyeing other platforms. After several disappointing quarters and executive turmoil, both co-founders left as CEOs in early 2012 (Lazaridis and Balsillie resigned in January 2012), leaving the company scrambling for direction.

Manufacturing and Quality Decisions

One critical business decision was the shift of handset production to China. Co-founder Jim Balsillie championed outsourcing manufacturing to reduce costs as BlackBerry grew. In 2010, for example, BlackBerry began contracting Chinese factories for phone assembly. In the short run this cut expenses, but it also introduced quality-control problems. The company’s product quality and reliability suffered according to insiders. In fact, analysts later described BlackBerry’s move to Chinese manufacturing as disastrous. Commentators note that “Balsillie insisted outsourcing to China will lower costs…[but] Lazaridis…refuses because he believes it will worsen the phone’s quality”. In practice, BlackBerry’s mass-market devices faced glitches (battery pullouts, buggy software updates, etc.) after the shift. One critic wrote that the decision to “shift manufacturing to China was an unmitigated disaster” for BlackBerry’s products. The quality issues damaged BlackBerry’s reputation even as rivals like Apple maintained tight control over their overseas production. (For context, Apple famously centralised much of its assembly in China and refined its supply chain to ensure consistent quality and massive scale.)

By late 2016 BlackBerry effectively exited handset manufacturing altogether, licensing its brand instead. In December 2016 the company announced it would no longer make phones itself: it outsourced future smartphone production to Chinese partner TCL and even moved to Android on its last devices. This retreat marked the end of BlackBerry’s hardware business. Ultimately, RIM’s effort to cut costs via Chinese production may have extended its life by a few quarters, but it failed to address the deeper loss of market share – and arguably hurt device quality along the way.

Competitors: Apple and Samsung

BlackBerry’s decline coincided with the meteoric rise of Apple and Samsung. Apple’s 2007 iPhone redefined the smartphone with a capacitive touchscreen and an ecosystem of apps and media. By the early 2010s Apple repeatedly introduced new features (e.g. voice assistant Siri in 2011) and refined its design. As a result, Apple grew from a niche to a dominant player: by late 2012 Apple’s iOS commanded about 35% of the US smartphone market. Samsung, partnering with Google’s Android platform, pursued a different strategy. Samsung and other Android OEMs could focus on hardware design while using Google’s free OS, letting them iterate devices rapidly. For example, CNN reported that by January 2011 Android (powering Samsung, Motorola, HTC phones, etc.) had reached 31.2 per cent US market share, narrowly surpassing BlackBerry’s 30.4 per cent. Within a few months Android even overtook Apple in share. Samsung also diversified its lineup (the Galaxy S/Note series) and aggressively priced phones, quickly becoming the world’s largest smartphone maker. In short, Apple and Samsung moved swiftly to meet evolving consumer demand (big screens, apps, multimedia) in a way BlackBerry had not.

Both competitors also executed smarter supply-chain strategies. Apple and Samsung leveraged massive Chinese factory networks to ramp production; BlackBerry had been slow to build comparable scale. As market trends shifted, Apple and Samsung gained share almost inevitably. By 2012 Gartner and ComScore data showed Android+ iOS owned roughly 85–90 per cent of the smartphone market, while BlackBerry’s share collapsed into the single digits. In effect, BlackBerry was “crowded out” by the iPhone and Android wave – competitors who bet heavily on touch interfaces, user-friendly operating systems, and app ecosystems, in stark contrast to BlackBerry’s legacy approach.

BlackBerry’s downfall resulted from concrete strategic and design missteps. It clung too long to its physical‐keyboard design and enterprise niche even as consumers demanded touchscreen, app‐rich smartphones. Its operating system updates and app ecosystem lagged behind Android/iOS. Internally, shifting priorities and a two-CEO structure slowed decisive action. Critically, the push by co‐founder Jim Balsillie to offshore manufacturing to China – intended to save money – is widely seen as having worsened product quality. Meanwhile, rivals Apple and Samsung seized the touchscreen era and optimized global supply chains, swiftly eroding BlackBerry’s market dominance. These verified factors, rather than hype, best explain BlackBerry’s rapid fall from industry leader to (by the mid-2010s) a company pivoting entirely to software.