RIM Blindsided By Apples iPhone

A new report says Research In Motion was blindsided” by the launch of the original iPhone, possibly the beginning of a downward spiral that completely eroded its huge market share advantage in less than four years.

But to be fair, few in the industry could have predicted the wild success of Apples smartphone. The new report on Research In Motion, written by Reuters, quotes one former RIM employee who said his colleagues thought the iPhone was so badly flawed” they didnt expect [it] to take off” the way it did. The idea that the developer community would embrace the device with such fervor came as a surprise to the Canada-based BlackBerry-maker. That same former employee said RIM was too focused on some of the more technical aspects of its smartphones, like the battery, security and more, when it should have been thinking more about features and applications customers would enjoy.

A venture capitalist quoted in the online PDF concurs, saying that RIM dramatically misjudged” how important the user experience would turn out to be.

But all that being said, the report is optimistic about RIMs upcoming entrant into the tablet computer market the BlackBerry PlayBook, expected to be available next month. While its aimed at businesses, the company has received generally good pre-release reviews and is confident it will successfully straddle the consumer-enterprise line.

The iPad, which got out of the tablet-market gate first in April 2010, still has the lions share of the market. But the PlayBook and the recently released Motorola Xoom, which runs on the Android platform, are expected to be the pose the biggest threat to Apples early dominance.