Hero to Zero now has a Theory

? Boing Boing

A few years back all the cool kids had a Blackberry…they were so popular and addictive they were even nicknamed Crackberrys.

However now when people pull out a Blackberry those of us with iPhones look down on them with pity….sometimes you can even hear the pity…ahhh…ohhh. Likewise RIM’s stock has dropped and the company is now an also ran in the handset market. Basically they fell off a cliff:

I think there are three factors that help create The Cliff. First, there is the replacement cycle. The average replacement cycle for mobile phones in year 2000 was 21 months. By year 2006 it was down to 18 months. Today it is 16 months (all handsets). For smartphones it is even faster, at 11.5 months. A car is replaced something like every 3 or 4 years on average. A TV set once every 7 years. A personal computer every 3 and a half years. But mobile phones are replaced every year and a half, smartphones replaced every year (on average).

So if you have a bad model car, and your sales suffers because of it, you will not lose all your loyal customers in a year or two, because many of your customers have last year’s model and are happy with it, and will not even come to your car dealership until two years from now to consider the replacement model, by which time you have had plenty of time to fix the problems with your current car model.

In mobile phones we do not have that luxury. The pace is so fast. And note that the rate of the collapse due to The Cliff is actually accelerating. This also suggests the replacement cycle and The Cliff are related.