The Changing Mobile Landscape: RIM Struggles, Apple Surges
A year ago, just after we put the wraps on Streaming Media's 2011 Sourcebook, three events took place that had significant impact on the mobile landscape -- and media delivery -- for 2011: Apple announced the Verizon version of the iPhone 4, AT&T announced its intent to buy T-Mobile USA, and Research In Motion (RIM) announced the PlayBook.
One out of three isn't bad odds in Las Vegas, or even when it comes to mobile companies. AT&T has seen the Justice Department and Federal Communications Commission (FCC) ignore its pleas to acquire T-Mobile for additional spectrum, and RIM has seriously scaled back -- both in the board room and with its PlayBook tablet. Apple is the sole winner of the three, adding not only Verizon in early 2011 but also Sprint to its stable of wireless carrier partners, with the release of the all-in-one CDMA/GSM iPhone 4S in late 2011.
This week, just after we finished up the 2012 Sourcebook, there's more bad news for AT&T and RIM, and another positive note for Apple, as all three companies reshape their respective portions of the mobile video delivery ecosystem.
RIM
Sunday evening, RIM announced that its two co-founders and co-CEOs, Jim Balsillie and Mike Lazaridis, would step down from their executive and board chairmen roles to be replaced by current chief operating officer Thorsten Heins. While the ousting of the co-CEOs had been rumored for some time, it surprised many analysts that the company didn't go for the more drastic step of bringing in an outsider CEO.
Instead, the company is allowing Lazaridis to retain the vice-chairman role, alongside new chairwoman Barbara Stymiest, a RIM board member since 2007. Balsillie will also remain on the board.
Analysts question whether or not the company is willing to change, even with the corporate BlackBerry market eroding and PlayBook sales lackluster. They also question the company's survival chances with an in-house CEO pick. Heins didn't provide any sense of impending danger during his first analysts meeting on Monday.
"I don't think that there is a drastic change needed," said Heins. "We are evolving our tactics and processes."
Asked about the idea of licensing QNX -- the company's operating system on which the PlayBook is based -- Heins said QNX is "an extremely competitive OS" and that RIM would be open to possible licensing deals for QNX "if it makes sense strategically and tactically." The idea of licensing QNX to other manufacturers adds an interesting wrinkle at a time when HP is considering licensing WebOS, after having shuttered its own mobile tablet and handset division.
AT&T
AT&T, for its part, had another bit of bad news, one that may leave many scratching their heads in a "what the ..." manner. On Monday, the company, which is subject to a $4 billion break-up clause in its acquisition agreement with T-Mobile USA's parent company Deutsche Telekom, announced it will give DT only $3 billion in cash.
The other $1 billion will consist of air, or spectrum, that AT&T apparently doesn't really need. That means AT&T is giving away spectrum shortly after using the argument of acute spectrum shortage as a compelling reason to buy T-Mobile USA. For its part, T-Mobile appears to be ecstatic about the new-found air that it will receive, perhaps giving the company breathing room to compete with Verizon Wireless and Sprint.
"This additional spectrum will help meet the growing demand for wireless broadband services," T-Mobile's senior vice president for government affairs, Tom Sugrue, told The Wall Street Journal. "We hope the FCC will move swiftly to approve the license assignments."
Apple
So what about Apple's news? Everything appears rosy for the "other fruit company," as RIM's Heins referred to Apple in his analyst call.
A study released by Consumer Intelligence Research Partners shows that Apple doubled initial estimates of competitor attrition: while initial estimates were that 18 percent of all iPhone 4S buyers in 2011 would abandon Android, Palm, or RIM handsets, it turns out that more than 36 percent of all iPhone 4S buyers came from these competing platforms.
The iPhone 4 had begun losing overall market share to the Android platform. Even though it remains the second-best selling phone of all time -- directly behind the fast-growing iPhone 4S -- the combination of the 4 and 4S have allowed Apple to claw back market share to come dead even with Android devices in the U.S.
Which handset company did they take market share from? RIM and its BlackBerry devices. And which mobile provider lost the most customers? T-Mobile USA.
All of this news sets the stage for next week's MacWorld / iWorld conference as well as the upcoming Mobile World Congress in Barcelona in February. Streaming Media will provide coverage from both shows.
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