D7 Interview: RIM CEO Mike Lazaridis Says It’s Not a One-Size-Fits-All Business

Published on May 27, 2009
by John Paczkowski

Mike Lazaridis of RIM

If Apple’s iPhone and the Palm (PALM) Pre are perfecting the convergence of cellphone and PC, Research in Motion’s BlackBerry anticipated it. And that’s largely thanks to co-CEO Mike Lazaridis, its patron saint, who conceived the BlackBerry in 1999 as a two-way pager, and in the ensuing years, transformed it into the device we know today.

The BlackBerry revolutionized corporate life with a famously addictive real-time, almost-anywhere connectivity, which prompted Merriam-Webster to recognize its “Crackberry” alias as the 2006 Word-of-the-Year. But that was three years ago–a lifetime in the mobile market. In 2009, “Crackberry” is a cliché and RIM (RIMM), though still a handset juggernaut, must work harder to maintain its dominant player status in an enterprise smartphone space crowded with formidable challengers: Apple, Nokia (NOK), Microsoft, Google and its open source Android OS.

Session Highlights

Live Blog

  • A first question from Walt, after Lazaridis takes the stage: Talk to me about your strategy for continuing to move beyond your base of enterprise email? Lazaridis notes that the Blackberry is expanding throughout the enterprise and into the consumer space. Ultimately the company entered the consumer space with the Pearl, which has been very successful.
  • Walt: What to people really want from their phones? Lazaridis says we expecting more from our phones. So it’s increasingly important that the basics are perfect–email, phone calls, etc. “The closer a technology gets to our person, the more it represents our style, our needs and our values.” So this isn’t a one-size-fits-all scenario. “The amount of choice has never been seen before in any industry that I know of.”
  • Shifting gears now, Walt asks about the economy. How has it affected RIM? “RIM’s been around for 25 years. I started RIM in a recession, and I’ve watched the business economy ebb and flow, and I know that no matter what the short-term temporal situation is, things get better….I have tremendous faith in the ability of technology to continue to drive value….The economy will recover.”
  • Walt circles back: You can’t be immune to the recession, so what have you cut? Lazaridis dodges a bit. “Well, we’re certainly not immune, but we’re not cutting research.”
  • Walt: Talk a bit about the iPhone as a competitor. Lazaridis says that all the buzz around the iPhone and the App Store has had a transformative effect on the industry. “Clearly, there’s a transition to smartphones now, and it’s happening faster now than it ever was before.” He notes that before the company launched AppWorld, it had over 10 million downloads of the BlackBerry Facebook app.

Mike Lazaridis of RIM

  • How do you view your competition? “Well, for the longest time we’ve been working to perfect push email and that built us a great reputation in enterprise. We continue to take that space very seriously and make great investments in it.” RIM has done its best to make its platform secure and scalable and that has served the company well as it caters to its core base in enterprise. Lazaridis seems to be saying that RIM’s position in the enterprise is so strong that he’s not worried about Apple (AAPL) or Microsoft (MSFT). Walt reframes the question, noting the great public response to Apple and its Apps and contrasting that to RIM’s fortress-of-solitude view of itself.
  • Walt: Is your OS as scalable and powerful as Google’s (GOOG) Android? Lazaridis says it is, the public just doesn’t know about it because we don’t promote it as actively as Apple.
  • Walt: Why wasn’t the Storm a better device? Ouch. Lazaradis blanches. “Well, it’s the No. 3 phone, Walt.” Walt: “I didn’t ask about sales, I asked why it wasn’t a better device.” Lazaridis: “Well, I’m sorry it’s only a No. 3 device…”
  • Walt asks if the Storm’s SurePress screen is here to stay. Lazaridis says it is. No comment on rumors that it will figure prominently in RIM’s next device.
  • Thoughts about tablet computers? Lazaridis doesn’t seem interested. He notes that we’ve seen offshoot products like these before. “Offshoot products trying to fill gaps that maybe don’t need to be filled.” Yes, a tablet is a cool concept, but can you put it in your pocket? And would you want one if you couldn’t?
  • What about the Kindle, asks Walt. Lazaridis says it’s great but wonders if we aren’t moving toward a convergence that will see devices like the Kindle subsumed by handheld devices.

Mike Lazaridis of RIM

  • Walt asks about the future of the network in an era of increasing data demands. Lazaridis notes that this is unfamiliar territory. “Voice usage doesn’t scale exponentially,” he says. “But data usage does….If we don’t get ahead of this problem and make things scalable and ensure that applications aren’t so data intensive,” we’re in trouble apparently. The industry needs to come together to resolve these issues before we’ve gone too far. Remember, voice and data often share the same bandwidth, and they’ll both suffer as data usage increases. He says RIM works very closely with AT&T (T) to optimize its radio code and its network so that everyone benefits. That said, “it may be a mistake to assume that you’re going to get the wired broadband experience in a wireless environment.”
  • If that’s the case, why are you raising consumer expectations? Your ads, and Apple’s as well, make people believe they can have that experience on their phones? Lazaridis doesn’t really answer. He says simply that developers must optimize their apps so that they don’t drain battery life and use up airtime. Walt circles back again: how are you going to stop your customers from wanting to do these data-intensive things on their phones? Another dodge from Lazaridis. RIM will focus on what it does best, voice and email. “If you want streaming video on your phone, that’s a very different proposition from wanting email and voice.”
  • On to the Q&A: First question involves the notion of viruses on cellphones. Does RIM worry about this? “We believe that over time, consumers will start to value the BlackBerry’s security accreditations.” RIM’s devices apparently have the largest number of these in the industry. And that should make consumers confident in the company’s devices. Walt jumps in: “So have you had a virus?” Answer: “Nothing that I’m aware of.”
  • Question about manufacturing and innovation with partners. “Manufacturing is part of our R&D cycle,” says Lazaridis. “We’re working in a continuous innovation loop.” RIM, he says, has achieved a good balance between in-house development and working with skilled partners where it’s necessary.
  • China and India issues? There are challenges there, but the company is committed to succeeding in those markets. Also, a question from the audience based on Eve Ensler’s interview earlier today about sexual violence in the Congo and her effort to encourage a market for rape-free phones. Walt offered further explanation. Lazaridis doesn’t seem to have very much to say about the issue. Unfortunately.
  • End of Q&A

A note about our coverage: This liveblog is not an official transcript of the conversation that occurred onstage. Rather, it is a compilation of quotes, paraphrased statements and ad-lib observations written and posted to the Web as quickly as we were able. It was not intended as a transcript and should not be interpreted as one.

Mike Lazaridis Session Photos

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Walt welcomes RIM CEO Mike Lazaridis to the D7 stage.

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