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iPhone vs Blackberry

The Sunday New York Times published a piece titled BlackBerry’s Quest: Fend Off the iPhone. Although it nicely introduced the coming conflict, frankly, it didn’t go far enough.

If innovation in these markets were to stop today, iPhone wouldn’t sway too many BlackBerry users. Poor integration with Exchange and the lack of a keyboard would end the conversation. Likewise, BlackBerry wouldn’t challenge iPhone on it’s core turf — the media and web browsing experience is not there.

But Apple claims huge pent up demand for iPhone in enterprise, and will introduce Exchange integration in iPhone 2.0, along with 3G. And RIMs 3G is apparently delayed.

So how will this likely play out?

First, ignore the analyst reports showing that RIM has lost market share. The dip from 45 percent to 40% reported by the Times needs to be considered in light of the fact that smartphone shipments have jumped by 60% due to the entrance of Apple into the market. A rising tide floats all boats.

The key to understanding this conflict is to understand the respective strategies.

Apple’s strength is user experience. They’ve focused on a fabulous consumer experience, and are working on connecting that to enterprise. RIM is focused on enterprise, and expanding to consumer. RIM’s user experience is a corporate IT managers user experience — incomprehensible for most people, and with a steep learning curve.

RIM’s strength is channel. Hundreds of carriers worldwide sell RIM products, but only a few carriers sell iPhone. Moreover, Apple is imposing serious (some would say onerous) demands on their channel for the privilege of a short period of exclusivity. RIM can counter Apple’s challenge with aggressive marketing and channel support in hundreds of countries. Apple must negotiate each new agreement in an environment where RIM holds the upper hand.

Moreover, partnering just isn’t in Apple’s DNA. Witness their repeated channel and OEM failures.

Look for RIM to focus aggressively on user experience. Apple has raised the bar and they must now respond. It would be a disaster for RIM if Apple were to ace the Exchange integration, removing yet another barrier to iPhone in Enterprise.

Similarly, expect BlackBerry to be aggressively marketed through the might of RIM’s global channel. Expect RIM to flood the market in geographies where Apple isn’t present (most of the world) in order to dominate those markets. Expect RIM to offer incentives to carriers and consumers in order to cement its position.

And Apple? If they were smart, they would steal a page from Nokia. iPhone 2.0 would be an unlocked worldphone, with preprogrammed carrier information for every carrier globally. Rather than perpetuate the fiction that they need carrier relationships, they would go directly to the consumer.

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