Lessons for the Canadians as they mourn BlackBerry’s demise

NIAGARA-ON-THE-LAKE, Ontario — The BlackBerry, created in Canada in the 1980s, jump-started a sort of Silicon Valley here, where young computer engineers flocked to participate in the next best thing.

It gave consumers across the US-Canada border and around the globe the first glimpse into where an untethered phone, connected to the web, could take you. It also demonstrated that the leader in any industry is only as good as its innovations and the vigilant creativity of its management, whether they come from Canada or anywhere else.

Even so, it’s hard to understand why Canadians are weeping quite so much over the demise of BlackBerry, which recently announced a quarterly loss of almost $1 billion and plans to lay off 40 percent of its workers. If you live in a place like Pittsburgh — the once-mighty steel capital now with an economy built on education and health care — you understand that the mightiest and most innovative companies can fail.

Canada’s best hope to start and hold the technological lead for wireless phones is in decline. Newer technologies leapfrog older ones; customers want the newest and shiniest technologies. Marketing matters, and time does not stand still for any post-internet innovation.

However, a recent trip to Canada reminded me that the orientation of the US neighbor to the north is different from Americans'. In terms of population, Canada is a small country — tiny, really — and it has a melancholy allegiance to companies that started in places like Waterloo, Ontario, where the BlackBerry is made.

It wants to compete with the US and clings to the notion that Canadians should support a sort of industrial nationalism. If national health care works and everyone is on board, why not expect Canadians to mourn the passing of one of its last best ideas? Or at least buy a BlackBerry?

Canadians bemoan the popularity of the iPhone. They recall the day Steve Jobs, a marketing genius, stepped onto a stage in jeans and black turtleneck holding the most remarkable of wireless devices, with killer apps to come. He said it was five years ahead of any other mobile phone and would use the ultimate pointing device, our fingers, “to create the most revolutionary user interface since the mouse.”

The iPhone became the new standard. Competitors hustled to emulate it and, using the new Android technology, introduced mobile phones that could do many of the same tricks.

By comparison, BlackBerry’s tiny keyboard and screen — and its embarrassing lack of apps — made it seem out of date. There was no Blackberry store then, and the race to keep up was quickly lost by slow rollouts, bugs in new products, and unresponsive management.

Research in Motion, as the company was known then, went from being the pioneer of the technology that led to an explosion in smartphones to being cut from the action, losing $965 million in the second quarter this year. The company cut 4,500 jobs this fall.

This is hard for Canadians to believe because, starting in 2003, the BlackBerry was the phone to have. The Queen had one. Obama could not stop using his. It was secure and cool. People who carried one were considered ahead of the curve. Companies bought millions, giving them to employees to email, browse the web, and make phone calls securely.

Canadians now are facing the reality that the country’s most valuable company in being bought for $4.7 billion by the Canadian version of Warren Buffett, Prem Watsa of Fairfax Financial Holdings Ltd. in Toronto. That company already owns 10 percent of BlackBerry.

This development has given Canadians plenty to worry about. Will their landmark innovation be viewed as a complete failure, in a scenario where the stock plunged but the top executives prospered? Will hundreds more workers in Waterloo lose their jobs? Will Canadians be left, once again, to follow the tastes and inclinations of a huge US market driven by flashy, incremental rollouts of the iPhone, now available in a range of colors?

Canadians should learn the lessons of BlackBerry’s death. It was killed by the very force it once rode: change is disruptive and recognizes no international borders.

Cindy Skrzycki is a senior lecturer in the English Department at the University of Pittsburgh and a business correspondent for GlobalPost.com. She has been a business columnist for Bloomberg News and for 18 years was on the staff of The Washington Post.