BlackBerry Service Outage Spells RIM Doom

InformationWeek Now--What's Hot Right Now

Saying that Research In Motion is in trouble is an understatement, but as the BlackBerry service enters its third day of troublesome outages around the world--now including North America--it's difficult to see an upside.

That giant sucking sound coming from the Great White North? A colossal purging of every ounce of goodwill RIM has left.

As RIM buried its head in the sand during the past year, pretending that everything was just fine, it seemed to insist that the only thing that needed to change were the industry analysts, the media, and customers, presumably by spontaneously mistaking halcyon days for the future of mobility.

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Yet there was one piece of good news: Enterprise IT, despite the stampede of end-users flooding the help desk with Android and iPhone requests, was reluctant to completely ditch BlackBerry as the primary enterprise mobile device.

The bad news: One of the pillars behind that choice was the BlackBerry service--the machine-like operation that, in tandem with BlackBerry Enterprise Server, provided centralized control of every device (down to the minute detail) and every message.

In fact, RIM could have made a good case to sell, spin off, or subjugate its device and mobile OS business and become the ultimate cloud-based provider of secure, managed mobile services. Apple, Google, Microsoft and a host of phone manufacturers would have been so thrilled to see RIM depart the mobile device business, that they might have bent over backwards to give RIM deep access to device management APIs. Carriers would have jumped at the chance to re-sell a RIM cloud offering.

To make matters worse, The Wall Street Journal openly speculated that as carriers begin offering service rebates to customers, those carriers may look to RIM for the same.

As InformationWeek's Eric Zeman wrote yesterday: "The issue is under investigation and appears to stem from a UK-based hub that RIM operates. The network operations center (NOC) in question controls traffic for the affected countries."

That failure seems to have caused a pile-up of messages, and that pile-up may be causing even more problems. RIM has yet to respond to direct requests for more information (InformationWeek sent its requests early Wednesday morning), but the company is posting updates on its web site--the latest simply acknowledging and apologizing for North American service delays, and pledging to resolve the issue quickly.

Let's review: RIM posts a 15 percent drop in second quarter revenue, following unmet expectations on BlackBerry Playbook and BlackBerry phone sales; investors continue to call for a restructuring, and the removal of co-CEOs Jim Balsillie and Mike Lazaridis (aka Fric and Frac).

In other words investors are unhappy, customers are unhappy, the tablet is suspect, and the phones have been uninspiring (save for the latest Bold and Torch refresh, which might be better termed "improvements" rather than inspiration.) Now the service, thought to be rock solid, is down.

As InformationWeek's Eric Zeman writes today: "The timing could not be worse for RIM. This week, Apple is released iOS 5 and the iPhone 4S, both of which can use its new BBM-like iMessage service. iMessage lets iOS 5 users avoid text messaging fees by using Apple's push systems. Additionally, Google and Samsung are expected to debut the newest version of Android in the coming weeks."

Even the sports personality Jim Rome tweeted this morning: "The week a new iPhone drops?! Slick, BB."

Here's the scariest part: mobile device management--another pillar in RIM's historical success--is one of the hottest mobile topics today, especially inside the enterprise. The options are dizzying.

BYTE's Serdar Yegulalp wrote on Tuesday about AT&T's new Toggle, a service that lets Android users toggle between personal and work mode. InformationWeek's Tom Claburn wrote about BizzTrust for Android, a project that partitions an Android device for the same basic purpose. InformationWeek's Mike Davis, an expert on mobile device management and security, proposed that most of this technology is moving to the cloud now.

Next week RIM holds its U.S. developer conference in San Francisco, where its co-CEOs will take the stage; Jim Balsillie is also slated to appear at Web 2.0 Summit right around the corner. Here's to a change of tone from the recalcitrance of the past year, a humble pledge to re-think everything, a new plan. It may still be too late.

Next year at this time, Fric and Frac may be chanting the immortal words spoken by Marlon Brando in On The Waterfront: "I coulda been a contender."