Losing The Signal tells the story of Blackberry, a company that rose from humble origins to control 50% of the US Smartphone market in 2009. Based on first hand accounts, Losing The Signal tells the story of a remarkable technology pioneer, once acclaimed as the world’s fastest growing company, who struggled to adapt when faced with the Innovators Dilemma.
Losing The Signal by Jacquie Mcnish / Sean Silcoff
Losing The Signal is a narrative about the power of innovation and it’s perils.
Written in a similar style to The Everything Store, this book tells the story of Research In Motion and it’s two founder CEOs, Mike Lazaridis and Jim Brasillie from humble origins to industry leaders, before finally being forced out of their own company.
It’s also a story about innovation, profiling not only the innovations that made Blackberry world famous but what happens to successful companies who fail to respond to changing circumstances, in this case, the entry of Google and Apple into the Smartphone market.
Below are some of the key insights I took from this book:
Key Insights
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- Business books are often culpable of narrative falacy (Jeff Bezos)
- You can’t connect the dots looking forward, but looking back Lazaridis was inspired by the words “The person who puts wireless communications and computers together is going to build something really special” p16
- Jim Brasillie was inspired by The Art of War to fight off the likes of Palm, Nokia, Motorola and Microsoft before the company grew large enough to survive.
- The origins of Blackberry started with a Mobiltex Motorola network, contracts with Rogers and a decision to invest $5 million in capacity to sell on to individuals at $50/month.
- Lazardis had the fundamental insight to strip out all additional features and focus on achieving results with the primative 2.5G network of the time.
- To scale the network, Blackberry focused on selling the product into Fortune 1000 companies with growth hack marketing and P2P evangelism.
- The company constantly came close to bankruptcy but Brasillie negotiated hard to ensure it’s success before taking it public in Canada.
- Blackberry threw Palm, Nokia, Motorola and other incumbents off the scent of it’s success with tough plays to hide their true intentions.
- The network constantly struggled to scale but Blackberry always relied upon it’s inbuilt product advantages for the corporate market.
- Oprah Winfrey took the product into the consumer market in 1999, opening up huge revenue windfalls but storing up further problems with growth.
- As the company grew in profile, two problems occured (1) Legal disputes over patents (2) Steve Jobs turned his attention onto the market.
- When the iPhone launched (January 2007), Steve Jobs negotiated AT&T exclusivity in exchange for overloading their network with full internet data. Blackberry were never able or incentivised to negotiate such a deal.
- As consumer demand changed, the economics of the networks changed but Blackberry couldn’t develop an iPhone killer for reasons of legacy Java software, lack of a coherent vision and a failure to solve the Innovators Dilemma.
- Despite this, Blackberry held 50% of the market in 2009, was valued at $20bn and had a huge lead over all other providers (Apple, Samsung, Nokia, HTC, Motorola)
- But Google then drained market share and network/supplier heads by offering the Android operating system for free to all other incumbents – setting up a two horse race for dominance of the Smartphone market.
- The decline came slowly and then all at once, with the Bold and Playbook models rushed to launch by a network desire for RIM to launch the iPhone killer. Lazardis and Brasillie had become victims of their own success.
- Despite this, Brasillie spotted the opportunity to revitalise the company based on it’s killer instant messaging app (BBM) which had the potential to become Whatsapp but needed to be made open to all platforms to secure it’s success
- Instead, with the share price falling, repeated delays and botched product launches, the pressure eventually told with both CEOs deciding to resign under pressure from investors.
- The authors conclusion about the moral of the Blackberry story is: ‘The race to innovation has no finish line, and that winners and losers can change place in an instant’