Wednesday, July 16, 2014

How IBM's Apple bite just killed BlackBerry today

Just when BlackBerry couldn't possibly fall farther away from the tree (or shrub, bush or bramble?), it just did. Today, IBM decided it would partner with Apple on a massive enterprise initiative that will undoubtedly finish BlackBerry off.

What does that mean exactly? Before we get to that, here's a really nice introductory reference between Apple and IBM's colourful history together.

The Apple 1984 Super Bowl Commercial

The preceding clip is perhaps the most important advertisement in the history of consumer tech. To a lesser extent, but something fundamental to our topic, the Big Brother that Apple was alluding to wasn't a fictional villain. During Steve Jobs' 1983 Apple keynote address, he had this to say before playing the ad for the very first time--

"[...] It is now 1984. It appears IBM wants it all. Apple is perceived to be the only hope to offer IBM a run for its money. Dealers initially welcoming IBM with open arms now fear an IBM dominated and controlled future. They are increasingly turning back to Apple as the only force that can ensure their future freedom. IBM wants it all and is aiming its guns on its last obstacle to industry control: Apple. Will Big Blue dominate the entire computer industry? The entire information age? Was George Orwell right about 1984?"

Indeed, a lot has happened since the Ridley Scott's 1984 ad was published more than three decades ago. One culprit in how Apple and IBM got back together was, well, Microsoft, whom wasn't a clear contender at the time. Microsoft of course would enjoy utter domination of the entire PC industry for the next three decades alongside Intel's processors. The PowerPC line of CPUs developed in 1991 by the AIM alliance--Apple, IBM and Motorola (now owned by Google) was somewhat a response to that. Apple would then drop PowerPC in favor of Intel's "faster" chips in 2005. Ahh the art of choosing friend and foe.

Let's get back to BlackBerry's fall from the, uh, shrub.

IBM CEO Virginia Rometty and Apple CEO Tim Cook

What Apple and IBM decided to do is super clear: to win over enterprise customers with iPads and iPhones running enterprise software from IBM. This is a behemoth-sized collaboration effort between a respectable/profitable/leading device manufacturer and an enduring enterprise applications provider. The latter is not to be underestimated as they remain one of the largest enterprise vendors in existence. Here's a quick Wikipedia summary on IBM's legendary tech output--

IBM has 12 research laboratories worldwide and, as of 2013, has held the record for most patents generated by a company for 20 consecutive years. Its employees have garnered five Nobel Prizes, six Turing Awards, ten National Medals of Technology, and five National Medals of Science. Notable inventions by IBM include the automated teller machine (ATM), the floppy disk, the hard disk drive, the magnetic stripe card, the relational database, the Universal Product Code (UPC), the financial swap, the RDBMS and SQL, SABRE airline reservation system, DRAM, and Watson artificial intelligence.

And they both win I think. IBM needed the iOS vehicle to enter enterprises that have clear mobile intent. Apple, on the other hand, wanted to enter the enterprise but didn't want the herculean effort that would distract their consumer-first strategy. It'a an absolute win-win partnership similar to that of Google and Nestle on KitKat (although certainly at lesser scale with the looming Android L).

The prize is the massive enterprise business that continues to fuel BlackBerry, which some still argue will continue to make BBs relevant in the enterprise space for the longer term. Sorry BlackBerry, not for long. That last vestige of hope is going away as a direct effect of the Apple-IBM partnership.