Losing the Signal: The Spectacular Rise and Fall of BlackBerry (9 page)

Lazaridis explained that he wanted to bring proper “push” e-mail to the Leapfrog—e-mail that arrived automatically on the device without requiring users to log in and download their messages. Users shouldn’t have to forward their work e-mails to the handheld devices—they should be able to send and receive e-mails wirelessly as if the Leapfrog was a portable, synchronized extension of their desktop computers. Surely the company had the know-how and technology to do this.

There were two major issues, security and bandwidth. An e-mail had to be encrypted at the point of transmission and only decrypted when it reached its destination. And whatever RIM designed had to respect the limited capacity of the Mobitex technology: a message would have to be limited to a kilobyte or two of data. Anything longer would have to be truncated or sent in stages. Mousseau furiously scribbled notes in his lab book as the two batted ideas back and forth. He couldn’t wait to get started. He already had a name for the project: Outreach. Over the coming months, Mousseau and a handful of other RIM engineers mapped out the basic concept. Mousseau developed a software program, known as the “redirector,” to be installed on a user’s desktop computer that would copy every e-mail, compress the information, and repackage the contents into a new message sent to the mobile device.

Ideally, the package would be sent electronically through the Mobitex wireless data network, then transmitted and decrypted to the user’s mobile device, but that wasn’t practical because it meant that every user would have to wait months to get the phone company to install a Mobitex modem.

Lazaridis had another idea: Instead of sending messages directly into the Mobitex network, it would fire user e-mails over the Internet to a transfer point at RIM. Since RIM already had its own connections into Mobitex, the messages would pass through this transfer point, a server which RIM called “Relay,” then funnel into RIM’s connection to Mobitex and on to the wireless device. The Relay would act as a clearinghouse for all messages sent to and from the wireless devices.

The system would also have to work in reverse: if a user tapped out a message on his or her handheld device, the machine would need to compress and encrypt the package and transmit it wirelessly to the nearest Mobitex tower. From there it would be sent through wires into RIM, then relayed to its destination. Every e-mail sent by the device would also find its way back to the user’s desktop computer, where the redirector would decode and unbundle it and place a copy in the sent box as if it had been typed out there to begin with.

For Lazaridis, it was important that the user had no sense of the complexity involved: the device should simply send and receive e-mails in sync with the desktop, like magic. As for his engineers, they would spend well over a year building the software and relay system to make wireless e-mail a reality.

By fall 1997 Mousseau was overwhelmed. He was working long hours and rarely able to see his four children. He was getting lost in the possibilities of what the device could do. Around the office, his colleagues began to call him “the Blur.” Late one night, RIM cofounder Doug Fregin peered into Mousseau’s office to see the software engineer seemingly frozen in his chair, his hands on his keyboard. Mousseau’s eyes were open but he was asleep.

Lazaridis could see Mousseau was struggling. He reined in the developer’s ambition to add such features as synchronized calendar and contact information—like the hot product of the moment, the Palm Pilot personal digital assistant—and Internet browsing. “We’re going to focus on mail only,” Lazaridis told him. He also promised to get Mousseau some help. One engineering co-op student recruited from University of Waterloo subsequently got pulled so deeply into the project that he failed several courses. (As a consolation, he was eventually hired on at RIM.)

Despite the brutal hours, Mousseau and the team were able to deliver what Lazaridis had requested: a working system to route work e-mails to and from its wireless devices.

Now, RIM just needed a wireless network to put the system into operation. Since BellSouth wasn’t willing to offer wireless e-mail, Balsillie and
Lazaridis crafted an alternative idea in late 1997: buying airtime on the Mobitex network from the disinterested carrier and running a service themselves. “What if I go in now and offer to buy $5 million worth of airtime, cash, now, and then I could sell it over a period of time?” Lazaridis asked Balsillie. “If we did that, then we could sell the devices for $500, but sell the airtime for $50 per month”—at a time when BellSouth was charging about three times as much each month for two-way paging service. “That would be much more appealing to the customer. We can sell it ourselves.”

It was an audacious move by a small device maker, to even think a big carrier would allow a puny upstart to start its own wireless data service and set its own terms. BellSouth’s Lenahan thought the idea was preposterous. Wireless carriers did not resell airtime; it weakened their hold on the market. What was RIM thinking? It was a small company with no back office staff to handle billing, sales, or customer service. “I thought RIM was getting itself into something they were not going to be any good at,” says Lenahan.

What Balsillie and Lazaridis understood was BellSouth Wireless Data’s vulnerability. Always on the lookout for potential opponents’ frailties, the RIM co-chiefs had learned that the Mobitex operator was facing a $10 million budget shortfall. It was still a weak ward of a large telecom company, and it needed to show any kind of return for the big investment its owner had made. The RIM bosses offered to pay $5 million up front out of the cash from its stock offering for two years of unlimited airtime on Mobitex. Although Lenahan was uncomfortable giving up airtime to a supplier, the lure of up-front cash was irresistible. He agreed that RIM’s cash offer was a better bet than RIM’s long-shot chance of generating profits selling airtime for an e-mail device. “I felt like it was our best option at the time,” he says.

RIM forged a similar deal in the smaller Canadian market with Rogers for $1 million. By 1998, the enchanted forest’s marketing guru, David Neale, had returned to Rogers and, like Lenahan, was keen to accept an offer that yielded “up-front revenues on an otherwise empty network.”

The novel agreements gave RIM full control to sell, promote, and manage e-mail traffic using the same device that was expected to deliver two-way paging to the masses. The two carriers would regret underestimating the potential of RIM’s wireless e-mail plan.

Handheld wireless e-mail was a breakthrough product nobody knew they wanted. When Balsillie and his new product manager, David Castell, began testing consumer appetite for a mobile e-mail service on the Leapfrog device, they assumed traveling salespeople and other busy professionals would line up for a product that constantly relayed urgent e-mail updates. Instead, focus group research revealed there was no burning desire by participants to quickly read or reply to electronic messages. If they needed to reach colleagues urgently, a phone call would do. At a focus group in Sunnyvale, California, one participant grew antagonistic when showed a device announcing e-mails with a buzzing noise. “If this thing buzzes every time I get an e-mail, you’d better ship it with a hammer,” he warned.

A more helpful insight came from a participant who spent much of his professional life on the road. He approached with dread his evening hotel ritual of downloading the day’s flood of e-mails on his laptop. It was a chore that inevitably involved hours of reading and replying. “If I just had a tool to help me with my volume of e-mail on the road, I’d pay anything,” he said. Convenience, not urgency, was a more potent marketing pitch. This was a device that could free customers to catch up on office communications on their terms. Idle time between meetings or lost time in taxis and airport lounges could be productively spent processing e-mails. Employers would be able to reach staff any time of the day and employees would not have to be tethered to computers. Bosses would never know e-mails were coming from baseball games, the golf course, or family homes.

The next step was positioning the service in the crowded technology market. Lazaridis was so captivated by the concept he argued RIM should sell the Leapfrog as a new product category: e-mail pagers. Castell and RIM’s marketing vice president, Dave Werezak, disagreed. Too many other innovative communicators, such as IBM’s Simon or the EO Personal Communicator, had failed in part because they tried to define new categories and consumers didn’t appreciate or understand what the products offered. RIM managers were influenced by management guru Geoffrey Moore, who argued in his influential book
Inside the Tornado
that innovative technologies had a better chance of success if sold within a proven product category.
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The most popular handheld device going in 1998 was the Palm Pilot, sold as a personal digital assistant, or PDA. Palm Pilot was a huge hit because it allowed busy professionals to easily store and update calendar and contact information on a pocket-sized device. If the e-mail-enabled Leapfrog came with calendar and contact applications,
Castell urged Lazaridis, then RIM could position its product as the most comprehensive PDA on the market. Lazaridis, who used a Palm, worried RIM would be seen as a weakling against the Silicon Valley darling. Castell’s pitch, however, was compelling: “If you want addresses and calendar, go for Palm. If e-mail is important, we’re the PDA to choose.” Lazaridis was swayed. His busy engineers were handed another impossibly short deadline to add calendar and contact applications to the device.

Lazaridis believed RIM’s new device was such a convenience that it would become the preferred mode for exchanging e-mails. For that to happen, the user interface on the Leapfrog—what the customer saw and experienced when using the device—had to be intuitive and easy to operate. “Remove think points,” was one of his favorite phrases. “I liked teaching people to put themselves in the minds of the users,” Lazaridis says. “I wanted to get to the point where users prefer to use [the device] to send messages than actually power their computers.”

E-mails often arrived with a thicket of coding and header information. Because the Leapfrog screen was so small, all unnecessary information was pared from the display. All that users would see when an e-mail arrived was who sent it, when it arrived, the subject line, and the first two lines of text. Lazaridis didn’t want a help menu—the device should never be that complicated. He believed that using the Leapfrog for e-mail should be so instinctive that users would never have to interrupt their train of thought to hunt for a command. “We found 90 percent of the time you did the same thing,” says Lazaridis. “So at any one point, there’s a high probability you’ll do the same thing. For each one, we tried to anticipate what the user would do next. If we got it right, everything became a double click [of the trackwheel]: one click to pull up the command, one click to execute.”

To Lazaridis, it was important that users only ever had one menu to choose from, rather than a multitude of options like most software programs. If you were typing a message and clicked the trackwheel, the menu would only bring up items that were relevant to crafting and sending an e-mail. It would also automatically highlight the Send function. The team developed other shortcuts, giving full functionality to thumb-typers without adding extra buttons. If a user typed two spaces, a period would appear at the end of the previous word and the next word would be automatically capitalized. If a user held down a letter key the machine would capitalize it, eliminating the need for the shift key.

Ideas began to spill forth from across the company and got coded into the platform: if a user typed B while reading an e-mail, the e-mail would scroll to the bottom; T brought the user to the top, and U to the next unread message. To send a new e-mail, a user had to type only the first few letters of the recipient’s name in the To: box and all potential matches would show up until enough letters had been typed to eliminate all others. Clicking on a person’s name in a calendar item would bring up a new e-mail, with that person’s name already in the To: slot.

Perhaps the neatest trick was making wireless e-mail appear faster and more instantaneous than it actually was. On other devices users had to log in, pull down messages, and wait for their device to process them. With RIM’s e-mail device messages arrived automatically, but the device still had to process them. That took time. Users didn’t need to know that. Lazaridis instructed his developers to hide the back-end process: users should be buzzed not when the e-mail arrived, but after it had been decrypted, decompressed, and dumped into their in-box, ready to read.

The thirty-minute ferry ride from San Francisco to Sausalito is one of the world’s more beautiful commutes. Passengers float by the Golden Gate Bridge and tree-topped Berkeley Hills as they make their way to the pastel-colored shops and restaurants of Sausalito. In the spring of 1998 a few dozen professional commuters arriving in Sausalito for some downtime were greeted with unwelcome work questions.

Stationed at the wharf was a trio of employees from Lexicon Branding, a local company renowned for its gift of selecting memorable brand names, particularly for nerdy high-tech products. Intel’s Pentium chip and Apple’s PowerBook laptop brand names were born in Lexicon’s Sausalito headquarters. On this day, Lexicon’s staff was assigned to test commuter attitudes about mobile devices. When the questions turned to e-mails, the results surprised them. E-mail wasn’t a convenience; it was a stress point. Mentioning the word inspired dread about work piling up in in-boxes.

This was a new insight for Lexicon’s client, RIM, which was searching for a name for the mobile e-mail device it was to launch in 1999. Lazaridis’s engineers loved PocketLink, the name RIM was using internally. Other choices included EasyMail and MegaMail.
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It was clear now to marketing vice
president Dave Werezak, who had hired Lexicon, that these names didn’t work; “mega” and “mail” were anxiety triggers. What RIM needed was a name that lowered workers’ blood pressure. Back in Lexicon’s office, staff brainstormed, writing soothing and positive words such as “summer vacation,” “melons,” and “strawberry” on paper taped to a wall. Lexicon founder David Placek didn’t like strawberry; it unfurled too slowly when he said it. That would not work for a device speeding up communications. Next to the name of the red fruit, one of his employees had scrawled “blackberry.”