Charlotte Street Partners

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DAILY BRIEFING

Lessons in obsolescence

Written by Katie Armour, senior associate
Edited by David Gaffney, partner

5 January 2022 

Good morning,

Cast your mind back to 2010, when Blackberry was at the height of its appeal. Tap tap tapping away on that qwerty keyboard. Exchanging BBM pins. Swapping batteries with a friend to charge your phone. (Here’s a full list of long-lost features if you want to feed the nostalgia).

Blackberry meant business and back then it had 43% market share. Three years later the company was edging towards oblivion with its share of the market collapsing to less than six per cent.

Touchscreens were the start of the end for Blackberry. The company was too slow to recognise the trend, launching its Blackberry Torch model in 2011, which was too little, years too late. This lapse in judgement – or responsiveness –  was compounded by making Bing the default search engine for its devices and, later, by WhatsApp’s decision to stop support for older devices.

This week, the firm has announced the end of the iconic devices for good. Blackberry hasn’t made new handsets since 2016 and will no longer maintain the technology that allows remaining vintage versions to “reliably function”. 

The Canadian company, which now focuses its activity on cybersecurity, said it had been maintaining the devices over recent years “as an expression of thanks” to loyal customers.

Now, however, forlorn handset owners won’t be able to make or receive calls, send texts, use wi-fi or access mobile data (with the exception of post-2016 Blackberry-branded phones, which use the Android operating system).

When it ceased production in 2016 the BBC penned a mock obituary to “the businessman’s best friend”, a marketing slogan that betrays, in and of itself, a lack of modernity. And while the company still pulls in around $1bn in revenue for its other services, the managed decline should be a cautionary lesson in fads, fashion and keeping up.

That lesson is innovate or die. In a fast-moving consumer market, customers are fickle and you need to offer new things and better value than the competition. Just look at your mobile phone to see how many of its apps have rendered classic things redundant: your watch, your digital camera, your need for cash, or your landline.

And yet, as I consign my trusty purple blackberry to my growing museum of redundant phones, the impact of built-in obsolescence feels at odds with the mantra of sustainability we now espouse.

The environmental impact of annually updating our laptops and phones is huge, but often ignored, and as the march of AI and robotics increasingly renders many human tasks unnecessary or uneconomic, are we responding and adapting fast enough? Or will we too end up on the shelves of history? Darwin’s theory of evolution doesn’t guarantee any species a permanent future.

News

The prime minister, Boris Johnson, has outlined his intention to stick with “Plan B” measures, after the UK’s number of new daily cases topped 200,000 for the first time. The prime minister ruled out a full lockdown and urged people to get a booster dose of the vaccine. (£)

Labour leader Keir Starmer made a new year’s speech yesterday setting out Labour’s priorities for “a new Britain: security, prosperity and respect”. He outlined the major challenges facing the UK in 2022 and promised to restore trust in government if he wins power at the next election.

The petition demanding Sir Tony Blair is stripped of the knighthood he was awarded in the new year’s honours list has surpassed 600,000 signatures. The petition brands him “personally responsible” for many deaths in the Iraq war. Current Labour leader Keir Starmer said the ex-PM had “earned” the honour.

Business and economy

Business secretary Kwasi Kwarteng is set to host crisis talks with energy companies today to prevent a “further string of corporate collapses” after wholesale gas costs jumped 25%. Consumer bills are expected to increase by up to 56% in April. (£)

Chinese property developer Evergrande has been ordered to demolish 39 residential blocks in Hainan, in light of claims the building permits were obtained illegally. Shares in the company have fallen by nearly 90% over the last year. (£)

Travel industry groups have called for remaining testing rules for travellers to be removed at the next government review of Covid measures, arguing that the restrictions had held back the sector’s recovery and that the policy was having “no real impact” as omicron rates are so high.

Columns of note

Alice Thomson writes in The Times about the “fatal loneliness” of people locked up in care homes and argues that restrictions on residents’ contact with friends and family should be eased now that the majority of them are protected by vaccines. (£)

Emma Brockes explores why so many people were apparently so delighted at the downfall of Elizabeth Holmes in The Guardian today. She questions whether it’s an extension of general dislike for those in Silicon Valley and suggests the episode has exposed the “credulousness of a system intent only on profit”.

Markets

What happened yesterday?

London stocks closed in a positive state on Tuesday, as investors were encouraged by signs that the omicron variant is less severe than previous variants.

The FTSE 100 ended the session up 1.63% at 7,505.15, and the FTSE 250 was also up 1.8% at 23,896.65.

Sterling was also looking positve against the dollar trading 0.46% higher at $1.35 and 0.49% higher against the euro, changing hands at €1.19.

In company news:

It was a positive day for travel company stocks, with easyJet, Wizz Air and TUI all seeing a significant rise in share prices. Oil firms BP and Shell saw increases of 6.2% and 4.8% respectively after OPEC agreed to raise their combined output target. Online supermarket Ocado saw its shares drop 7.27% on positivity about the impact of omicron, as the company has benefitted from previous lockdowns.

What’s happening today?

Final Dividend Payment DateBatm Advanced

Interim Dividend Payment DateGreat Portland

Br.smaller Cos.Games WorkshopTate & LyleBunzl

Source: Financial Times

did you know

Saturn is the only planet in our solar system that is less dense than water. It could float in a bathtub if there was one big enough. (Source: NASA)

Parliamentary highlights

House of Commons 

Oral QuestionsWales

Prime Minister’s Question Time

Ten Minute Rule MotionPensions (Extension of automatic enrolment)

LegislationPublic Service Pensions and Judicial Offices Bill

AdjournmentAward of public contracts to private companies during the covid-19 outbreak

Westminster Hall debateHistorical allegations of sexual abuse and the justice systemDeforestation in the AmazonHousing in Sittingbourne and SheppeyImmigration requirements for non-UK armed forces personnel

House of Lords 

Oral QuestionsUK drivers’ time spent in trafficDesign issues with sanitary provisionVictims of building safety defectsSupport to the Philippines following typhoon Odette 

LegislationNationality and Borders Bill

Scottish parliament 

First Minister’s StatementCovid-19 Update

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