If there’s one advantage Apple didn’t have when it released the iPhone, it was a head start. Years before the idea for the iPhone even crossed Steve Jobs’ mind, BlackBerry devices were absolutely killing it in the marketplace. Even Microsoft, which tends to get laughed at for missing important trends in the tech space, had been working on various Windows Mobile devices going all the way back to 2000.

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While it’s easy and perhaps simple to attribute BlackBerry’s demise and Microsoft’s string of failures in the mobile space to the fact that neither company came up with the idea for an iPhone-like device themselves, that explanation completely misses the point. After all, Apple’s success over the last 15 years clearly demonstrates that being the first entrant in a new product category does not, in and of itself, guarantee success.

The reality is that both BlackBerry and Microsoft were completely blind to what the iPhone was. Which is to say, BlackBerry and Microsoft’s mobile troubles didn’t arise because they didn’t invent the iPhone, but rather because they completely ignored the future staring them right back in the face the moment Steve Jobs unveiled the now iconic smartphone to the world back in 2007.

Google sees the light

Andy Rubin Android

Contrast Google’s reaction to Jobs’ iPhone announcement with what we now know about how both BlackBerry and Microsoft responded. In the 2013 book Dogfight: How Apple and Google Went to War and Started a Revolution, author Fred Vogelstein recounts the immediate panic that then Android head Andy Rubin felt after watching a live webcast of Jobs’ presentation while driving in a cab in Vegas. According to the story, Rubin knew right then and there that his Android team would have to completely rework the type of device they were working on. “Holy crap,” Rubin reportedly said at the time. “I guess we’re not going to launch that phone.”

The team members on Google’s Android team, to their credit, similarly recognized the superiority of what Apple had on its hands with the iPhone.

“We knew that Apple was going to announce a phone,” former Android team member Ethan Beard told Vogelstein. “Everyone knew that. We just didn’t think it would be that good.”

One of Google’s Android engineers recalled, “What we had looked so… nineties.”

Another Android team member, Chris DeSalvo, explained: “As a consumer I was blown away. I wanted one immediately. But as a Google engineer, I thought ‘We’re going to have to start over.'”

And so, the entire concept of what Android was supposed to be was scrapped and completely redeveloped, with the iPhone feature set now serving as the project’s new driving force.

And though early iterations of Android really lagged behind iOS, Google at the very least saw where the market was going and was able to adjust course mid-stream.

BlackBerry and Microsoft laugh off the iPhone as a serious threat

Now compare that panic and sense of urgency that permeated throughout Google’s Android team to how Microsoft and RIM took the news of the iPhone unveiling.

First up, let’s tackle Microsoft, if only because it gives us an excuse to show case this Steve Ballmer interview, taken in the wake of the iPhone announcement, where Ballmer dismisses the iPhone as a competitive threat.

The iPhone brought so many advancements to the market, and yet, Ballmer seems wholly preoccupied with the iPhone’s price.

BlackBerry’s reaction was no better.

While the company’s co-CEOs at the time were mildly impressed with some of the device’s features, they remained beholden to the tactile keyboards that had already made them so much money. And while they did eventually come out with the BlackBerry Storm, that product was effectively kickstarted at the behest of Verizon.

As BGR documented a few years ago, BlackBerry co-CEO Mike Lazaridis effectively had his blinders on for years after the iPhone debuted.

“When you hear Mike [Lazaridis] talk about the latest and greatest, it’s been the same thing for ten years: security, battery performance, and network performance. RIM has positioned battery life and network performance for years. People are not concerned with iPhone battery life,” one source told me. Network performance, to Mike, trumps any innovation a device like the iPhone offers. “Mike is convinced people won’t buy an iPhone because battery life isn’t as good as a BlackBerry,” a different source said. Mike apparently is in disbelief that people can use over 15GB of data on their iPhone and Android devices, and he feels that people will buy smartphones based on network efficiency, even though carriers with tiered data plans in developed markets love customers who use monstrous amounts of data.

No excuse of ignorance

With the iPhone, Apple showed the world what the future of mobile communication was going to look like; multi-touch displays, intuitive software, fully functional web browsing. Whereas it took RIM and Microsoft a few years to appreciate the new reality they were living in, other companies, like Samsung for example, recognized right away that the tech landscape was shifting in sweeping and dramatic ways.

The unfortunate reality is that both BlackBerry and Microsoft didn’t need a magic crystal ball or some incredibly brilliant executive to tell them what the future of the smartphone market was going to look like. Google knew right away. Samsung knew right away. And even though the Palm Pre didn’t sell exceptionally well, the folks at Palm, clearly, also knew that the iPhone signaled a new era for the smartphone.

The tech industry moves pretty fast, as Ferris Bueller might say. Success, though, isn’t exclusively bestowed upon those who create the technological shifts that keep the industry exciting. Rather, success is also enjoyed by those companies insightful enough to recognize when a technological shift is occurring, something that both BlackBerry and Microsoft completely failed to appreciate even when it was happening right in front of their eyes.

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