The trend in the mobile space the last three years has all been about monetizing services. BlackBerry is no stranger to this foray especially when it comes to its BBM and Enterprise servers. These are services that comprise the bread and butter of what BlackBerry is aiming to make money off of when it says it plans to focus on software. The entire industry has taken a fundamental shift from traditional ad services and marketing towards more direct subscriptions and user fees for products and services. Spotify has a premium service for uninterrupted music listening, TV networks like HBO have HBO Go streaming subscriptions for TV shows, and even our own website platform WordPress has a subscription service for more advanced web editing features. Adding to the mix we’ve seen a plethora of specific services from BlackBerry done in a similar vein within BlackBerry Messenger using BBM Meetings, BBM Protected, BBM Stickers and BBM Timed Messages/ Message Retraction and Editing to bring in some revenue.
In a world where there are hundreds of services vying for those low-margin profits of what I like to call pocket change (around $1-$5) it gets much more difficult to rely on the individual user as opposed to an effort of attrition. Companies are literally throwing stuff at the wall and seeing what sticks. It’s a matter of getting 100m people to spend $1 as opposed to 1,000 people spending $1,000. It’s a much more competitive world in the sense that we as the consumers are demanding better products without wanting to pay more.
Typically, economies of scale would decrease the cost of products as more people purchase them but with software and services the bulk of the entire production costs are tied up in research and development, which is to say that once you see a finished product the majority of the big money has been spent on it. Whereas at the beginning of the industrial revolution a factory could retool; they could build chairs, they could always cut down on production yet still put out a quality product. The technology world doesn’t quite have the same luxury when it comes to software, when they build a product they have to spend the money on it and can’t just say they’ll build 500K softwares, because in essence they’re just building the one piece of software and distributing it to the masses which shifts that much more emphasis on the quality of the product, and supporting that product as opposed to how it gets built and viewing the product as a something that continually gets produced, because it doesn’t.
This new avenue of low margin revenues on bulk user bases has been spreading like wildfire. Even traditional stand-alone software like Microsoft Office and Adobe Photoshop have changed their business models towards subscription services. In essence, we the consumers demanded better products, services and support but we’ve failed as consumers to grasp or accept the higher costs of production. If you’ve ever heard of someone complaining about micro-transactions or in-app purchases it’s nothing but an attempt by companies to foot those larger development costs on the backs of those users who use their products the most. It’s a very competitive business model that allows consumers to pick and choose what they want to purchase, shifting the overall costs onto the backs of those who use the most services, that cost the most to develop, and which consume the most amount of resources. I can’t tell you how frustrating it was previously to have to shell out thousands of dollars for Adobe Suite when all I really wanted was Photoshop and even then I didn’t really need all the extra add-ons and plugins. In essence I was footing the development costs for things I wasn’t using. It’s a change I’m very happy to see take place in the industry and one that is certainly influencing the development of BBM and BlackBerry as a whole.
Whenever the topic of monetizing BBM comes up it usually stirs up a relatively lively debate on the merits of an approach that has been considered “nickel and diming core users” on more than a few occasions. I’ll be honest, I am not the most impressed with BBM’s somewhat lackluster performance with BBM Channels updates nor am I impressed with the incentives they give us to spend money on the messaging service (since when did anybody think $2 for stickers that looked like rocks was a good idea!?) but I do see the potential to meet users and financial goals on a common ground.
The issue with BBM today is that most of what it monetizes are things that people neither need, nor often use. I’m all for choice of stickers and the ability to pick and choose what services I want to purchase but I can’t help but think about the tremendous amount of missed opportunities when it comes to monetizing the messaging service, especially BBM Channels. A custom pin is nice but it’s also not something people usually advertise. My BBM is extremely personal and I do not stick it out there in public for those very reasons. Sure a custom pin would cut down on those few times I’m getting someone to add me but once someone adds me they’ll likely never see my custom pin again. Would it look nice on a business card? Sure. Do I need a custom pin? No.
On the flipside if BBM made a concerted effort on BBM Channels and allowed channel owners to have multiple admins ON THEIR MOBILE DEVICE (not through a web-portal), and allowed channel users to create their own custom channel pins THAT would be something that would get the right person to pay a decent price for it. And while you have less people to get revenue from (because there are less channels than users) it shifts the business model to focusing the bulk of the revenue on those who place the greatest value and benefit from it. If you’re a giant corporation and you used Channels, wouldn’t you be willing to shell out a few hundred dollars for a custom channel pin? What’s a few hundred dollars when you’re using the service to interact with thousands or even millions of potential purchasers? It really comes down to a focus on pinpointing those few who are willing to pay a lot, while allowing the majority to use your service as a means to attach added value to the userbase as a whole. A robust BBM Channels userbase is much more valuable to a company and it’s why I don’t think BlackBerry should be trying to monetize simple consumer oriented functionality like timed messages and message retraction. Those are things that add value and attract people to the platform.
The situation is a bit different with stickers because those aren’t functional as much as pieces of art or personal copy-written material, but it still stands that the entire stickers platform could be opened up to a wider range of sticker creators. If you open it up it creates more competition, better stickers and better overall profit for the platform as a whole. Our resident BerryFlow graphic artist Pootermobile has been trying for ages to get his stickers on the BBM shop and it’s not an easy feat, mainly due to the severe latency of correspondence from BBM contacts…
While it’s easy to point out some of the glaring flaws with BBM it’s also easy to point out some things it’s doing really well. I love the approach BlackBerry is taking with regards to BBM Meetings and BBM Protected. These are quality value-added services that make a substantial difference to how one uses the service. It’s not a “nice-to-have” these are services that, to the right customer or enterprise, are an essential product to have. They’re not features that diminish the overall value of the service by not using them, but they also add a tremendous amount of value by choosing to pay for them.
BlackBerry can promote a greater out-of-the-box BBM experience and a focus on expanding its userbase by piggybacking it’s revenues on the backs of enterprise. It shouldn’t be relying on holding back small features like timed messages and message retraction. Those have, in my mind, a tremendous opportunity to attract potential users with what I like to call the dealership sticker. Features that you’re not necessarily going to use, but something that’s included that gives the service a leg up on the competition.
Whether it’s a company advertising through BBM Channels, a Fortune 500 corporation using BBM Protected through BES, or a small marketing department for a local shop using BBM Meetings, it should be those who get the most value and profit from using the service who should be the ones who should stand, and be willing, to pay the most for the service. At the end of the day BBM has been and will always be a reliable communication service that provides second to none convenience and functionality but it shouldn’t be trying to be everything to everyone and it shouldn’t be looking for a dollar from everyone either.