Sep 29, 2016 ยท 4 minutes

It's sort of the end of an era.

BlackBerry said Tuesday it won't develop its own hardware anymore, prompting a lot of nostalgia for its once-beloved smartphones. Of course, BlackBerry has been outsourcing its hardware manufacturing to FoxConn for a few years, and it will still make the software inside BlackBerry branded phones. What's new is that it won't design the hardware anymore, but outsource that as well.

In other words, BlackBerry is doing something similar to what Google did when it sold off Motorola Mobility, or when IBM backed out of laptops to focus instead on software. It's acknowledging that the low, low margins of commoditized hardware isn't worth the hassle, especially in a cutthroat market like smartphones.

And so the go-to hot take on the news – it's the end of an era! – is strictly speaking not true. BlackBerry isn't dead. The phones will still be sold. On the other hand, the BlackBerry we remember from a decade ago has been gone for some time. Yet many features, notably security, that made people love BlackBerry remain.

Still, many consumers have a need for closure after the collapse of a brand that was once part of their daily lives, a product that once managed to elicit more than a degree of emotional intimacy from them. They need a date that marks the end of an era. But there is no such closure for the BlackBerry phone. Instead, it's like a door that is endlessly closing. A patient that keeps on breathing, less and less perceptibly, on the hospice bed, with the expected death rattle always put on hold.

There's something about this that is as sweet as it is irrational. Just as people went nuts when the Macintosh said hello, early BlackBerry users raved about the smartphone's scroll wheel, a device that wouldn't be tolerated for a second today. And yet today, there is no sense of wonder when the iPhone 7, an infinitely smarter smartphone than the first BlackBerry, was launched. There was a sense of malaise, even disappointment. Forget the talking Macintosh, when people accidentally summon Siri by sitting on the iPhone home button, they get irate.

This gets at one of the interesting things about the reaction to this week's BlackBerry news. The more advanced and commonplace a gadget becomes, the less enchanted we grow at each new innovation. Our ability to be wowed hasn't diminished, but it gets harder and harder to spark that sense of wonder that the initial versions inspired. Instead, the pioneer products are the ones we look back on with longing: the CompuServe subscription, the General Magic handheld device that many recall fondly but that really nobody bought, the GeoCities sites that sat there in oblivion until Yahoo shut it down and caused a round of collective nostalgia.

A similar sense of nostalgia is spreading this week around the BlackBerry, along with rehashes of the postmortems that have been written ever since it was clear Research-in-Motion, as it was then called, had blown for good its share of the smartphone market it helped pioneer. Worse, it lost out on what is perhaps the most successful market of all time, with 2.6 billion smartphones in use today, a figure expected to rise to 6 billion in four years.

BlackBerry's market value has fallen from $83 billion in 2008 to about $4.4 billion today. Under Chen's tenure, the company has pushed harder into software, while outsourcing more and more hardware to others. A year ago, Chen made one more stab at a smartphone hit with the Priv, an Android OS inside a BlackBerry body with the company's signature security features. That too didn't work. BlackBerry shipped only 400,000 phones last quarter, half as many as a year ago.

Instead, Chen has been pushing into areas like connected cars, the Internet of things and enterprise software. This is taking root slowly: Revenue from software services more than doubled last quarter to $156 million, or 44 percent of total revenue. Revenue from devices will continue for some time, but only in the form of brand and software licenses to manufacturers in Indonesia, first, and perhaps China and India later on.

So on the one hand, the collapse in BlackBerry's market value is remarkable given its scale and potential eight or nine years ago. On the other, many people might be surprised to know BlackBerry was worth more than $4 billion. After all, this is a company that sold less than half a million phones last quarter, and whose share of the global smartphone market has plummeted from 20 percent in early 2009 to 0.1 percent last quarter. That's right. Only one in one thousand smartphones sold now is a BlackBerry phone.

And that's the other thing that BlackBerry's news highlighted this week: The smartphone market may be vast, but the market forces driving the industry are as swift and brutal as it gets. Players like Xiaomi can see their shares surge and fall in the span of a couple of years. Those market forces have been pushing steadily against BlackBerry for years, and yet the company still has hopes of a modest turnaround. It will look dramatically different by the time Chen is finished, but it's quite possible it will not only be profitable (the company broke even last quarter) but also growing.

“It's the start of a new chapter rather than the end of an era,” Chen said on Bloomberg TV, as if endings don't naturally lead to new beginnings. As the smartphone market saturates and people wonder what will emerge to replace it, BlackBerry is quietly toiling to have a modest role to play in that future. It's not laughable anymore to say it just might get there. As for the rest of us, we'll probably be cursing whatever those new gadgets will be, while wistfully recalling our obsolete iPhones in the golden light of nostalgia.