RIM Says BlackBerry 10 Will Soon Be Ready For Licensing
Research In Motion Ltd. (RIM) said it will soon be ready to license the company's new BlackBerry 10 operating system to other manufacturers, even as it races to release its own devices with the software by early next year.
Context & Ripple Effects
RIM's BlackBerry 10 push has been building all year on the software side: the company confirmed BB10 would reach the PlayBook back in March, and by April a rumor had the first BB10 phone launching in October. What changes with this announcement is the business model around that software — RIM is signaling it will license BlackBerry 10 to other handset makers rather than keep it exclusive to its own devices.
The move lands amid a rough stretch for the company: CEO Thorsten Heins is reported to have seriously weighed a switch to Android (unconfirmed), RIM has denied compromising BlackBerry security for the Indian government, and reporting from early August documents how RIM's decline is hitting its home city of Waterloo. Licensing is the turnaround lever being put forward instead.
First-order effects
- Other manufacturers get a credible third smartphone OS to evaluate alongside Android and iOS, with RIM's security-and-messaging heritage as the pitch — while RIM's own hardware team still has to ship BB10 devices by early 2013 to prove the platform works first.
Second-order effects
- Licensing splits RIM's incentives: every BB10 phone sold by a rival dilutes RIM's hardware margins but builds the app ecosystem and carrier relationships its devices depend on, forcing a pricing decision between royalty income and platform scale.
Third-order effects
- If manufacturers bite, the smartphone market moves toward a structure where a struggling hardware vendor survives as an OS licensor — a path where control of the software layer, not device volume, becomes the asset worth defending.
The trend: Smartphone platforms are consolidating toward two dominant ecosystems, pushing third-place players like RIM to survive by licensing their OS rather than selling only their own hardware.