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Is RIM the Next Nokia? - Misreading the Market

Much like Nokia, RIM's troubles have stemmed from a deep misunderstanding of the market.

When the iPhone was first unveiled in January 2007 RIM co-CEO Jim Balsillie (pictured) proclaimed: "The recent launch of Apple's iPhone does not pose a threat to Research In Motion Ltd.'s consumer-geared BlackBerry Pearl and simply marks the entry of yet another competitor into the smartphone market; It's kind of one more entrant into an already very busy space with lots of choice for consumers. But in terms of a sort of a sea-change for BlackBerry, I would think that's overstating it."

This turned out to be nothing more than denial. At the end of last year a former RIM employee revealed the 'complete internal panic' at the company on seeing Apple's handset. "{The iPhone} couldn't do what {Apple was} demonstrating without an insanely power hungry processor, it must have terrible battery life," the employee said of RIM's mindset. "Imagine their surprise when they disassembled an iPhone for the first time and found that the phone was battery with a tiny logic board strapped to it."

RIM hadn't learned its lesson. By November 2009 Balsillie was telling Reuters "The world has shifted to smartphones faster than I expected, really." He brushed off rivals saying "I'm not trying to be dismissive, and I'm not trying to be glib, but this has played before, several times. All that's different is there's a couple more zeros on everything."

Again like Nokia, RIM then failed to grasp the market switch towards touchscreens and the finger friendly software that came with them. The BlackBerry Storm met with mixed reviews and was a commercial failure. The Storm 2 took a year to arrive, was a minor tweak of the original and also failed.

By the time the BlackBerry Torch (above) turned up, aping the Palm Pre, featuring last gen hardware and again falling between two stools it was clear the company was in trouble. A recent security breach has also done little to build confidence in the business sector nor has Basillie's latest quip that "you don't need an app for the web". Meanwhile RIM's move to a completely new QNX-based OS drew scorn from Steve Jobs who commented: "We've now passed RIM, and I don't see them catching up with us in the foreseeable future". I think it's going to be a challenge for them to create a competitive platform and to convince developers to create apps for yet a third software platform after iOS and Android".

Jobs is well known for his Reality Distortion Field, but the fact is: RIM recognises it

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