Read Online Losing the Signal: The Spectacular Rise and Fall of BlackBerry by Jacquie McNish, Sean Silcoff - Free Book Online Page A
Authors: Jacquie McNish, Sean Silcoff
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glass-covered notebook, with an electronic pen for writing documents, faxes, and messages. Unlike its namesake, the Newton was no genius. Indeed, its bumbling handwriting recognition feature soon invited widespread ridicule.
Doonesbury
’s creator, Gary Trudeau, featured the clumsy Newton in a 1993 comic strip that depicted him scrawling: “I am writing a test sentence” on the tablet. After several garbled electronic interpretations, the Newton yielded a last, desperate translation: “Egg freckles?” Apple abandoned Newton in 1998.
IBM launched a revolutionary phone at Disney World in Orlando in late 1993 called Simon. The phone offered mobile calling, an address book, calendar updates, faxes, and e-mails. Simon was a hit with technology buffs but flopped in the consumer marketplace. The machine was complicated and carriers lacked network capacity for the data-hogging phone. Simon passed away in 1995. 3
One company that would draw millions of users to Clinton’s promised superhighway was not invited to the 1993 White House event. Its DNA, however, was inside the EO Personal Communicator that shuttled the president’s message. Embedded inside the doomed tablet were software programs guiding the message to a radio network. The software creator was Research In Motion. 4
Three years after Clinton’s promise of a new communication era, the wireless data highway was going nowhere. The trade publication
Mobile Data Report
captured the frustrations of an impatient marketplace by lamenting the slow pace of innovation in 1995, which it called “the year of dullness.” 5 Carriers and product makers charged too much for mobile devices that conveyed tiny amounts of data at mulishly slow speeds, the magazine complained. The only bright spot, it wrote, was a little Canadian company destined to “have a big impact” after unveiling a small, low-cost radio modem card that connected devices to the Mobitex network.
Research In Motion was reinventing itself in 1996. It had gained notice inthe industry by making radio modems that connected laptops, delivery trucks, and other mobile data users to the Mobitex network. But Lazaridis and Balsillie had even greater ambitions: to make their own device. They started by making a point-of-sale terminal that stadium vendors could use to sell merchandise and food to fans in their seats in 1994; the machine was briefly used in the SkyDome where the Toronto Blue Jays played, but it didn’t do well otherwise. What RIM needed was leverage in a field dominated by muscular companies demanding punishing terms, Balsillie believed. Ericsson and Rogers squeezed RIM by stalling payments of licensing fees.
Then, in 1996, the Skokie, Illinois–based modem maker U.S. Robotics dealt the company a devastating blow. Four months after ordering $16 million of wireless modems from RIM, U.S. Robotics reneged on the deal, potentially stranding RIM with insufficient cash to pay a multimillion-dollar loan borrowed to cover the cost of manufacturing the large modem order. “We were very vulnerable,” says Balsillie, “a frog being cooked.” If the company did not find new customers for the rejected modem cards it would not be able to repay its bank loan.
U.S. Robotics later asserted in legal proceedings that the modems were defective. Balsillie had a different take: he saw another wolf trying to wound RIM by squeezing its cash flow. The Skokie company was led by a former hippie named Casey Cowell who started building modems in his bathroom in 1976 in his early 20s. 6 From there he muscled past established players to build U.S. Robotics into a $2 billion industry leader, snapping up other modem makers along the way. One of his targets was RIM. “For their size they were very independent and aggressive. Those were qualities we liked to have,” Cowell says.
From Balsillie’s perspective, if U.S. Robotics couldn’t buy RIM, it would make the company’s life difficult. U.S. Robotics agreed in December 1996
Doonesbury
’s creator, Gary Trudeau, featured the clumsy Newton in a 1993 comic strip that depicted him scrawling: “I am writing a test sentence” on the tablet. After several garbled electronic interpretations, the Newton yielded a last, desperate translation: “Egg freckles?” Apple abandoned Newton in 1998.
IBM launched a revolutionary phone at Disney World in Orlando in late 1993 called Simon. The phone offered mobile calling, an address book, calendar updates, faxes, and e-mails. Simon was a hit with technology buffs but flopped in the consumer marketplace. The machine was complicated and carriers lacked network capacity for the data-hogging phone. Simon passed away in 1995. 3
One company that would draw millions of users to Clinton’s promised superhighway was not invited to the 1993 White House event. Its DNA, however, was inside the EO Personal Communicator that shuttled the president’s message. Embedded inside the doomed tablet were software programs guiding the message to a radio network. The software creator was Research In Motion. 4
Three years after Clinton’s promise of a new communication era, the wireless data highway was going nowhere. The trade publication
Mobile Data Report
captured the frustrations of an impatient marketplace by lamenting the slow pace of innovation in 1995, which it called “the year of dullness.” 5 Carriers and product makers charged too much for mobile devices that conveyed tiny amounts of data at mulishly slow speeds, the magazine complained. The only bright spot, it wrote, was a little Canadian company destined to “have a big impact” after unveiling a small, low-cost radio modem card that connected devices to the Mobitex network.
Research In Motion was reinventing itself in 1996. It had gained notice inthe industry by making radio modems that connected laptops, delivery trucks, and other mobile data users to the Mobitex network. But Lazaridis and Balsillie had even greater ambitions: to make their own device. They started by making a point-of-sale terminal that stadium vendors could use to sell merchandise and food to fans in their seats in 1994; the machine was briefly used in the SkyDome where the Toronto Blue Jays played, but it didn’t do well otherwise. What RIM needed was leverage in a field dominated by muscular companies demanding punishing terms, Balsillie believed. Ericsson and Rogers squeezed RIM by stalling payments of licensing fees.
Then, in 1996, the Skokie, Illinois–based modem maker U.S. Robotics dealt the company a devastating blow. Four months after ordering $16 million of wireless modems from RIM, U.S. Robotics reneged on the deal, potentially stranding RIM with insufficient cash to pay a multimillion-dollar loan borrowed to cover the cost of manufacturing the large modem order. “We were very vulnerable,” says Balsillie, “a frog being cooked.” If the company did not find new customers for the rejected modem cards it would not be able to repay its bank loan.
U.S. Robotics later asserted in legal proceedings that the modems were defective. Balsillie had a different take: he saw another wolf trying to wound RIM by squeezing its cash flow. The Skokie company was led by a former hippie named Casey Cowell who started building modems in his bathroom in 1976 in his early 20s. 6 From there he muscled past established players to build U.S. Robotics into a $2 billion industry leader, snapping up other modem makers along the way. One of his targets was RIM. “For their size they were very independent and aggressive. Those were qualities we liked to have,” Cowell says.
From Balsillie’s perspective, if U.S. Robotics couldn’t buy RIM, it would make the company’s life difficult. U.S. Robotics agreed in December 1996
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