Research In Motion Limited (TSX: RIM, NASDAQ: RIMM) or RIM is a Canadian multinational telecommunications company headquartered in Waterloo, Ontario,

Canada. that designs, manufactures and markets wireless solutions for the worldwide mobile and telecommunications market. RIM provides platforms and solutions for access to information, including e-mail, voice, instant messaging, short message service (SMS), Internet and intranet-based applications and browsing. RIMs portfolio includes the BlackBerry wireless solution, the RIM Wireless Handheld product line, software development tools and other software and hardware. It was founded by Mike Lazaridis, who currently serves as its vice chair of RIM's Board and Chair of the Board's new Innovation Committee. The company is listed on the NASDAQ stock exchange in the USA in addition to the Toronto Stock Exchange in Canada.

Prior to the manufacture of the BlackBerry, RIM worked with RAM Mobile Data and Ericsson to turn the Ericsson-developed Mobitex wireless data network into a two-way paging and wireless e-mail network. Pivotal in this development was the release of the Inter@ctive pager 950, which started shipping in August 1998. About the size of a bar of soap, this device competed against the SkyTel two-way paging network developed by Motorola. RIM's early development was financed by Canadian institutional and venture capital investors in 1995 through a private placement in the privately-held company. Working Ventures Canadian Fund Inc. led the first venture round [3] with a C$5,000,000 investment with the proceeds being used to complete the development of RIM's two-way paging system hardware and software. A total of C$30,000,000 in pre-IPO financing was raised by the company prior to its initial public offering on the Toronto Stock Exchange in January, 1998 under the symbol RIM.[4] Since then, RIM has released a variety of devices running on GSM, CDMA, and iDEN networks. The ubiquity of these BlackBerry devices in the corporate environment and the compulsive use of its ability to quickly send and receive e-mail has earned it the nickname "Crackberry" in a reference to crack cocaine as users feel they cannot live without it. In 2006 Research In Motion and Information Appliance Associates reached a licensing agreement whereby RIM would offer the complete version of PocketMac for BlackBerry to Macintosh users free of charge.[5] In October 2008, RIM was named one of "Canada's Top 100 Employers" by Mediacorp Canada Inc., and was featured in Maclean's newsmagazine.[6]

RIM announced in February 2009 that they were expanding their global operations by opening an office and training facility in North Sydney, New South Wales, Australia. Just across the Harbour Bridge, ten minutes from the Sydney CBD, the new RIM offices were formally unveiled by Mr Thomas A.MacDonald, Consul General of Canada, at a ceremony attended by dignitaries from the New South Wales Government and North Sydney Council, as well as RIMs partners and customers. The new office features training facilities, a research and development centre, a strategic partner marketing centre and technical support services.[7] Total workforce provides 12,000 jobs world wide. In June 2009 RIM has announced they were acquiring Dash Navigation, makers of the Dash Express.[8] In August 2009, RIM acquired Torch Mobile, enabling the inclusion of a Webkit-based browser on their Blackberry devices. On August 18, 2009, Fortune Magazine named RIM as the fastest growing company in the world with a growth of 84% in profits over three years despite the recession.[9] On March 26, 2010, the company announced acquisition of BlackBerry applications developer Viigo, a Toronto-based company. Terms of the deal were not disclosed.[10] RIM reached an agreement with Harman International on April 12, 2010, for RIM to acquire QNX Software Systems. "RIM is excited about the planned acquisition of QNX Software Systems and we look forward to ongoing collaboration between Harman, QNX and RIM to further integrate and enhance the user experience between smartphones and invehicle audio and infotainment systems," said Mike Lazaridis, President and Co-CEO at RIM. "In addition to our interests in expanding the opportunities for QNX in the automotive sector and other markets, we believe the planned acquisition of QNX will also bring other value to RIM in terms of supporting certain unannounced product plans for intelligent peripherals, adding valuable intellectual property to RIM's portfolio and providing long-term synergies for the companies based on the significant and complementary OS expertise that exists within the RIM and QNX teams today."[11][12][13] On September 27, 2010, RIM announced the long rumoured BlackBerry PlayBook tablet computer. The BlackBerry PlayBook was officially released to US and Canadian consumers on April 19, 2011. As of May 2010, RIM OS held 10.4% of the smartphone operating system market.[14] On Jun 30, 2011, an investor push for the company to split its dual-CEO structure was unexpectedly withdrawn after an agreement was made with RIM. RIM announced that after discussions between the two groups, Northwest & Ethical Investments will withdraw its shareholder proposal before RIM's annual meeting.[15] In September 2011, RIM decided to build assembly factory (hardware) in Malaysia rather in Indonesia, but Indonesia will become the Blackberry's application and market research centre(software).[16]

On October 10, 2011, RIM experienced one of the worst service outages in the company's history. Tens of millions of BlackBerry users in Europe, the Middle East, Africa, and North America were unable to receive or send emails and BBM messages through their phones.[17] The outage was caused as a result of a core switch failure, "A transition to a back-up switch did not function as tested, causing a large backlog of data, RIM said."[18] Service was restored Thursday 13 October, with RIM announcing a $100 package of free premium apps for users and enterprise support extensions [19][20] On January 22, 2012 RIM announced that Co CEOs Jim Balsillie and Mike Lazardis have stepped down as CEOs and announced the new CEO to be Thorsten Heins

Challenges that RIM had to see in 2010it showed

http://www.zdnet.com/blog/btl/rims-challenges-about-to-multiply/40152 Research in Motion still has the leading smartphone platform in the U.S., but its lead is looking more tenuous by the day. ComScore released its August smartphone market share tally and the three month moving averages dont look good for RIM.

As you can see from that chart, RIM took the biggest market share hit. Microsoft was another big loser, but thats to be expected. Microsoft is sunsetting Windows Mobile and the Windows Phone 7 debut is on deck. In fact, youd expect Microsoft to lose more market share. RIM isnt sunsetting anything. It has the Torch and BlackBerry OS 6.0. However, RIM is

using a new operating system for PlayBook tablet, which at this point is just a demo. Simply put, the storm clouds are brewing for RIM. Among the moving parts:

its

Apples iPhone could be coming to Verizon. If that scenario actually plays out, RIM will effectively be crowded out at the major carrier. Indeed, Motorolas Droid Pro is designed to be a BlackBerry killer. Wedbush analyst Scott Sutherland said:

We believe a Verizon iPhone will eat into sales of RIM, Motorola, and other key Verizon handset vendors. While this has been somewhat anticipated, we believe this could accelerate RIMs market share losses in North America.

Android devices keep coming. ComScores data as well as other firms note that Android devices are gobbling up market share. This market share often comes at RIMs expense. Windows Phone 7 may hit RIM too. A wave of Windows Phone 7 devices are on deck. Corporations will at least give Windows Phone 7 a look and the operating system already looks fresher than what RIM has to offer. RIM is not the enterprise lock it used to be. Good Technology, a rival to RIM, is going gaga for Android devices and partnering with Verizon. Good also released a study today showing that its enterprise activations are heavily skewing toward Apple iOS and Android devices. These activations are a good indicator of what non-BlackBerry devices are playing well in the enterprise.

Now all is not lost for RIM. BlackBerry devices consume less bandwidth and thats always going to be a hit for carriers. Meanwhile, security is a selling point for RIM. If countries are complaining that RIMs security is a risk to them Id take that as one helluva commercial. RIM also has a vast intellectual property portfolio. Jefferies analyst Peter Misek said RIM has secret weapons, but is under siege.

With the blurring of the Tablet, PC, and smartphone market, RIM has tremendous growth prospects in our opinion; however, RIMs strongholds are currently aggressively under siege with market share losses likely in the enterprise and domestic markets. Simply put, how RIM manages through the Android and Apple onslaught will largely determine how relevant it remains in this generation of smartphones.

RIM paints a rosy fiscal picture, but challenges loom

Research in Motion announced its fiscal third quarter results on Thursday (PDF), showing quarterly growth in revenues and handset sales, but continued dismal tablet numbers. As Apple, Amazon and others are on track to sell millions of tablets this quarter, RIM says it shipped only 150,000 PlayBooks in the past three months; note that shipped doesnt equal sold. The results followed a provision from two weeks ago when RIM said it would take a $485 million pre-tax charge related to its PlayBook inventory. Aside from continued bad tablet news, RIM suggests that its business is rosy:

Revenue of $5.2 billion, up 24 percent from last quarter ending Nov. 26 BlackBerry smartphone shipments of 14.1 million, up 33 percent from last quarter Subscribers up 35 percent year-over-year to almost 75 million

But the future continues to look murky as the companys guidance suggests that revenues and smartphone shipments will be lower in the next quarter, which includes the holiday period. RIM figures revenues between $4.6-$4.9 billion with smartphone shipments of 11 to 12 million handets. The company says that 79 percent of its revenue this quarter came from hardware sales; not services and software. If youre not growing the segment that makes up the bulk of your revenue stream, Id say theres a problem; especially when iOS and Android hardware is selling like hotcakes. The PlayBook could have helped, but if anything has made things worse due to negative publicity for an unfinished product that isnt selling well in whats considered one of the hottest market segments. At this point, the March results next year could be a make or break time for RIM. By then, well know a few things: will be BlackBerry 10 be enough to help sell more BlackBerry handsets when it arrives around mid-year; if RIM delivers its PlayBook software update in time; and if so, can it turn a tablet loser into a competitor. UPDATE: RIM said its BlackBerry 10 phones will not be available until the second half of 2012 because it is waiting on the availability of dual-core LTE chipsets that will power their new phones. This is just going to prolong RIMs turnaround. Sales of BlackBerry 7 devices are going to continue to drop off as people anticipate the next generation phones

from RIM. But the longer it takes the company to put out those BB10 phones, the more it risks slumping unit sales and shrinking market share. RIM said it hoped to launch a big advertising blitz in 2012 to help drive sales. And co-CEO Jim Balsillie said he and fellow CEO Mike Lazaridis would reduce their salary to $1 a year. These are nice gestures and plans but the real issue is that RIM is not moving fast enough in a market that is zooming by. By the second half of 2012, RIM will be facing an even more advanced iPhone and a slew of Android phones even more more formidable than the Galaxy Nexus. And Microsoft and Nokia are going to be cranking up their efforts to make Windows Phone 7 a credible third horse in this race.

4 tough challenges for RIM's new team

Can a leadership change save BlackBerry maker?
http://www.networkworld.com/news/2012/012312-rim-leadership-255221.html

For the first time since its founding, Research in Motion has changed its top leadership, with a new president/CEO, a new board chairwoman and a new major investor who specializes in turnarounds. But can they save RIM? Will RIM survive? The next 12 to 18 months are likely to be critical for RIM's future, as it makes its first major leadership change since its start nearly 30 years ago.

1. Leadership matters: Who are the new leaders?

All three are relatively new to RIM, compared to the original founders, Mike Lazaridis and Jim Balsillie, who famously held the positions of co-CEO and co-chairman. Both remain as members of the board. They told the board that it was now time to move forward with the previously created succession plan. This past weekend, the board agreed, and acted. TIMELINE: RIM's very bad year in 2011 The new chief executive is Thorsten Heins (pictured above), with RIM since December 2007, about six months after Apple began shipping the original iPhone and disrupted the smartphone market. Formerly with Siemens Communications Group, Heins started at RIM as senior vice president for hardware engineering, and rose rapidly to become chief operating officer for product and sales in August 2011. Lazaridis and Balsillie have been grooming Heins as their successor for some time, according to reports. The new chairwoman, Barbara Stymiest, 55, became a RIM board member that same year, after top positions with the Royal Bank of Canada and before that the Toronto Stock

Exchange, where she was the first female president of a North American stock exchange. When she took over, the exchange was wracked by technology problems. Under her leadership, five years later TSE was the first North American exchange to be publicly traded. Royal Bank hired her in 2004 as COO in a management overhaul to stem falling profits. She was responsible for "strategic development," with all corporate areas reporting to her, including finance and risk management, according to Bloomberg News. One of the key figures who influenced the sudden leadership change, according to some news reports, is the newest board member, now one of RIM's biggest investors, Prem Watsa, the Indian-born, publicity-shy CEO of Fairfax Financial, a Toronto financial holding company, specializing in insurance, re-insurance and other markets. "Tackling troubled companies is Mr. Watsa's bread and butter," according to The Globe and Mail. "His commitment to RIM reflects his long-held strategy of buying companies on the cheap and then unlocking their true value." And his track record shows it: Fairfax's share price has gone from $5 in 1985 to $415 last week. The combination of large-company administrative skills strategic thinking, and investment savvy could prove to be a potent blend, energizing RIM at all levels. Still missing: top-level marketing skills. Heins said in a conference call this week that finding a chief marketing officer who can breathe new life into RIM's marketing efforts is a top priority.

2. The strategy: Don't expect changes

Despite the calls for radical change, all three new leaders agree the current strategy, developed over the past two years or so, is sound: in effect, to recreate RIM around a new line of devices that exploit a new operating system, a new application development model centered around HTML5 and other Web standards, a bundle of services, and an expanding "ecosystem" of applications, with the option of running Android apps via a virtual machine. Heins is emphatic that the decision to base all new RIM devices on the Neutrino realtime operating system, acquired by buying QNX Software Systems in 2010, was the right decision. In the conference call, he disputed the idea that the QNX operating system was a "me-too" platform, trying to catch up to rivals. It's a proven multi-threaded OS, he said, widely used in a range of markets including automotive telematics and core Internet routers (it's the basis of Cisco's IOS XR software for carrier routers, for example). "It's not in a catch-up race," he said with a slight laugh. "It's very competitive." RIM's PlayBook tablet in 2011 was the first RIM product to run it, and reviews of the user interface -- shaped by the design expertise of another RIM acquisition in late 2010, Swedish-based UI designers The Astonishing Tribe -- and of the underlying operating system were generally favorable [a YouTube video shows the UI in action]. RIM will release Version 2.0 for the PlayBook in February. The company plans to introduce a range

of other products in the latter half of 2012, based on the QNX code, now dubbed BlackBerry 10. As Heins noted, RIM isn't licensing another's technology, as Nokia is doing with Microsoft Windows Phone, nor building a new one from scratch as Palm did with webOS. Instead it can continue to refine the UI of a proven OS.

3. It's all in the details: Getting RIM to grow up

While Heins didn't overtly criticize his predecessors in the conference call, he made clear that the company's weaknesses are. One is execution -- getting a quality product to market on time and on budget. For several years, RIM has been plagued by product delays and other problems that stem from being unable or unwilling to bring a greater degree of discipline to product development. "When I joined in 2007, RIM was growing and still acting as a startup," he said. "But startup processes don't scale." Since his appointment as COO, he's been focusing exactly on scaling a range of business processes, and said "we've improved a lot in the past 10 months." "We have to scale these processes further: [such as] resource management, rigid project management, rigid program management, and also the processes of defining a product and executing on the product," Heins said. Over the past 10 years, RIM "innovated while we were [still] developing the product -- that needs to stop," he said. Innovation needs to be focused and limited to the early stages of planning, prototyping and design. Once a product has been thus "defined," the temptation to make changes has to be resisted, and "execution has to be precise and decisive." The challenge, and opportunity, Heins faces is somewhat similar to that at Apple. The current CEO, Tim Cook, was personally recruited by the late Steve Jobs to bring discipline to Apple's development and management of an overseas supply chain, which has been critical to Apple's volume sale of high quality products, and to its big profit margins. As a result of Cook's success, Jobs recommended the board appoint Cook as his successor.

4. Marketing: Facing and listening to consumers

Another top priority is obtaining a chief marketing officer. "I want this ASAP," Heins said. He wants someone who can communicate to RIM's markets effectively. But that effectiveness will also depend on listening to customers in those markets, according to Heins. "I want us to have a bit more of an ear to the community, especially our consumer users' space," he said. "We need to do a better job there."

RIM Hit With Legal Challenge Over BBX Name

Research in Motion can't catch a break. After the lackluster release of its BlackBerry PlayBook tablet and a massive three-day outage, the company is now facing a trademark challenge over its recently introduced BBX platform. New Mexico-based Basis International said in a Thursday statement that it has taken "swift legal action" against RIM to protect its trademarked BBx products. "We have thousands of product licenses installed worldwide with the 'BBX' prefix that run on Windows, Linux, Mac OS X, and other proprietary UNIX OSs from IBM, HewlettPackard, and SUN, with mobile clients running Apple iOS, Google Android, and Windows Mobile," Basis chairman Nico Spence said in a statement. "We are fielding numerous customer inquiries voicing their confusion about the RIM announcement." Basis did not elaborate on what type of legal action it took, but Reuters reported that the company's patent attorney sent RIM a cease and desist letter that requested a response by October 31. "RIM has not yet received a copy of the legal complaint described in Basis International's press release, but we do not believe the marks are confusing, particularly since our respective companies are in different lines of business," the company said in a statement. "Ironically, BASIS' BBx may aid RIM in its quest to grab a share of the application market for mobile devices in that any application created with BASIS' BBx for the Android or iOS mobile devices will also run on BlackBerry products," Spence continued. RIM unveiled BBX at this week's DevCon conference. The OS features HTML 5 support, robust security, and a commitment to open standards. It combines the company's RIM BlackBerry 7 OS and the QNX OS from the PlayBook. Going forward, BBX will be the OS of choice on RIM's smartphones, mobile devices, and embedded systems. http://www.pcmag.com/article2/0,2817,2395075,00.asp

BlackBerry Bold 9900 facing design flaw: Report

TOI Tech | Feb 3, 2012, 05.22PM IST eleaguered cellphone giant BlackBerry maker-Research In Motion, which saw its co-CEOs stepping down last month, is in trouble again. According to Canadian website Mobilesyrup which has posted image of a leaked internal document, the RIM's flagship model Bold 9900 is facing a design flaw courtesy OEM holster which makes the phone's keypad and keys simply knock off over time. The report reveals that "RIM has identified a design issue with the holsters supplied with BlackBerry Bold 9900 devices manufactured before November 3, 2011. Due to a folded edge, inside the lip of the holster, keys on the keyboard can be caught and knocked off when inserting the device into the holster at an angle with excessive force." However, the document posted on the site also states that RIM has since corrected the design of the holster and the devices manufactured post November 3, 2011 are not affected. The company is reportedly also extending the warranty of the affected phones to 18 months. Research In Motion launched Bold 9900, which comes with a keyboard along with touch display, in India last year in August priced around Rs 32,490. The phone runs on the new BlackBerry OS and is RIM's thinnest BlackBerry smartphone yet. It sports 1.2 GHz processor, 2.8-inch capacitive touchscreen display, NFC support, 5 megapixel camera, 8GB of onboard storage, and claims an improved web browsing experience.

NEW YORK: Research in Motion's Thorsten Heins plans to waste no time in his new job. The BlackBerry maker's chief executive said he will present the board with his plan for company's future in just a matter of weeks. The German-born executive, who took over from two longstanding co-CEOs on Saturday, said his plans for RIM would be "significant" though he did not divulge details in an

interview with Reuters. "I will have time with the board in two weeks to present my ideas and changes," Heins said. But the executive, who was promoted from the role of chief operating officer, said he has already done groundwork to tackle his company's most pressing problem - persuading the US market to covet the BlackBerry again. While RIM is growing in other countries, Heins conceded that its US business is in need of a major revival after losing out to rivals like Apple Inc's iPhone at US service providers and corporations, where it once had a clear advantage among employees heavily dependent on its email service. "In general I wouldn't consider RIM as a turnaround candidate. It is a turnaround candidate in the US," he said. "We lost market share in this market quite substantially. That is something that we have to address." While US operators such as Verizon Wireless and AT&T Inc have helped BlackBerry with heavy advertising and promotions in the past, these operators have been much more focused in the last few years on devices like iPhone and smartphones based on the Google Inc operating system. Heins' quest to regain ground with these operators has been complicated by the fact that RIM had to announce in December that it is delaying the launch of phones based on BlackBerry 10 - its next-generation software - until the later part of 2012 as it is awaiting the availability of a high-powered chip. The executive would not say when exactly these phones would hit the market but implied that they would arrive in time for the year-end holiday-shopping season in the fourth quarter. So in the meantime, Heins will concentrate on getting the most current BlackBerrys into more consumers hands. He noted that only 20 percent of US BlackBerry users have the company's latest phones, which he says are competitive with rival smartphones. The rest of RIM's US customers have devices with older RIM software, some of which are "two generations behind," he said. To overcome this, RIM has devised a new upgrade plan with US operators to promote phones with the BlackBerry 7 system, which was launched in August last year. "All the plans are ready. The carrier agreements are all ready. Now we have to get off the starting grid. Now we need to execute that upgrade program," Heins said. While he did not want to disclose specifics about the new agreements, Heins said RIM

could look at new ways of bundling different devices together or offering carriers smartphones with a package of pre-loaded applications. He is also betting on the company's PlayBook tablet to compete with the Apple iPad tablet. This spring, Heins said that RIM will launch a version of the Playbook, with a high-speed wireless connection based on LTE - a technology that the top three US operators are building into their networks. Verizon Wireless and AT&T are already promoting LTE devices including smartphones and tablets from RIM's rivals. RIM's first smartphones with LTE connections will be in the company's BlackBerry 10 line-up, Heins said. Moment of surprise: In his first presentation to Wall Street as CEO earlier this week, Heins said he did not think the company needed drastic change, causing some analysts to worry that the executive would not do enough to reverse the company's fortunes. But the executive said on Friday that he was merely telling Wall Street that he does not want to change the core of RIM. "Is RIM up for sale, is RIM up for a split-up?" He rejected those possibilities as "a drastic, seismic change because it would tear the company apart." Heins, who has been with RIM for four years after spending over two decades at German engineering group Siemens, was became COO responsible for software and products seven months ago. He explained that RIM had succession plans for co-CEOs Mike Lazaridis and Jim Balsillie in place for some time and that he had an inkling that he was being groomed to follow in their footsteps when he was named COO. "The moment they tell you it's still a surprise," Heins said, smiling broadly and adding that he immediately said yes. Lazaridis and Balsillie, who turned the BlackBerry maker into a global company and a household name, stepped down last week but will remain on the board. Some analysts have worried whether these executives would have too much of a say in the future strategy of the company because of their position on the board. Heins said, it would be an advantage to be able to tap into the experience and company knowledge of RIM founder Lazaridis, but he made it clear that he would be the one calling the shots. "What I do with the company is my decision. The CEO runs the company."

BlackBerry maker RIM says global issues do not impact Indian market
http://economictimes.indiatimes.com/tech/hardware/blackberry-maker-rim-says-globalissues-do-not-impact-indian-market/articleshow/11621440.cms

NEW DELHI: Are you lost? Marooned? Fired? Hurt?" Raghav Sood asked in a presentation for a tracker app at a two-day Hackathon app developers event organised by Research in Motion, maker of BlackBerry smartphones, earlier this month. Incidentally, Research in Motion-which will soon offer Sood's 'friend in need' to BlackBerry users in the country-looks lost and marooned and all that, after its global market share and market value tumbled in 2011 and irate investors forced co-CEOs Mike Lazaridis and Jim Balsillie out last weekend, as Google and Apple outsmarted it in the marketplace. In India too, BlackBerry's market share has been sliding as Android phones such as Samsung Galaxy gain ground. While the company has been taking a number of initiatives including launching new handsets and touch phones and getting India-specific apps under its new MD Sunil Dutt, several analysts feel it could prove too little too late. "Samsung and Nokia have hit it hard in terms of premium positioning, and they don't have a handset below 10,000 in India," says a telecom analyst, adding BlackBerry may need to cut prices to regain its market share. Experts say the Canadian company will need to give up its premium positioning and introduce lower-priced handsets if it has to defend its share in a price-sensitive market like India. Analysts say that RIM's strongest differentiator-push mail-may have lost its appeal as other mail and social networking apps gain traction. GLOBAL TROUBLE Once a dominant player in the smartphone industry, RIM has lost significant ground in the past couple of years as Google's Android came and conquered the industry, with every second smartphone sold in the world now running on Android. RIM's market share, meanwhile, dipped to 11% in the third quarter of 2011, according to Gartner. In the US, its share halved to 16.6% in November last from 33.5% in November

2010. And its market value has dropped below $9 billion now, from $80 billion in 2008. Its share lost 75% of its value on the Toronto Stock Exchange in 2011 alone. Co-CEOs Lazaridis and Balsillie, credited with designing the firm's rise, quit on Saturday following months of clamouring by restless investors. The new CEO, Thorsten Heins, is already under pressure. A Reuters report quoted Jaguar CEO Vic Alboini, who leads an informal group of 16 RIM shareholders calling for a radical restructuring, as saying, "If Thorsten really believes that there are no changes to be made, he will be gone within 15 to 18 months. He will be a transitional CEO and this will be a transitional board." Last year was particularly forgettable for RIM with a series of failures. Its table PlayBook flopped, the launch of its new line of smartphones was delayed, a massive service outage hit its brand image, and, it cut some 2,000 jobs in June. "Anybody can say the direction the company is headed toaand it's definitely going to impact its India operations," says the telecom analyst quoted earlier. CONFIDENT DUTT Research in Motion India MD Sunil Dutt, however, denies that BlackBerry has lost market share in the country. He says the company has been rationalising its channel strategy and this could have impacted volumes over the last two quarters. "But our revenues are not hit." He says RIM has successfully managed to appeal to Indian youth, adding that the global issues do not impact Indian consumers' decision. "From being an enterprise product, BlackBerry has transformed itself into the consumer space," says Dutt. "We will launch more plans such as BlackBerry messenger for 5/day," he adds. RIM India Marketing Director Krishnadeep Baruah says, "Our brand equity is intact in India, which is the fastest growing smartphone market in the world." RIM indeed has had phenomenal success in India-one of the markets that can either make or break the fortunes of the Ontario-based handset maker. NEW YORK | TORONTO: Research In Motion Ltd. shook up its top management, replacing co-chief executive officers Jim Balsillie and Mike Lazaridis, who guided the BlackBerry maker for two decades and struggled to compete against Apple Inc.

Thorsten Heins, a chief operating officer who joined RIM four years ago from Siemens AG, will replace the pair in the CEO post effective immediately, RIM said in a statement. Director Barbara Stymiest will take over as chairman, as the two also cede their cochairmen positions. Lazaridis, who founded RIM in 1984, will become vice chairman; Balsillie will remain a board member without any operational role. The shakeup comes after Balsillie and Lazaridis showed little sign of being able to stop Apple and Google Inc.'s gains as the Silicon Valley companies remade the mobilecomputing market with devices such as the iPhone and iPad. Waterloo, Ontario-based RIM's stock tumbled 75 percent last year as sales slumped, and the two men, both 50, drew investor criticism for releasing products without the features necessary to compete. "Heins is a product execution guy, he's not a visionary," said Ehud Gelblum, a New Yorkbased analyst at Morgan Stanley. "Heins has to give people a reason why they need a BlackBerry. It's going to be very difficult for him." RIM, once the most valuable company in Canada, fell 3.2% to $17 at the close in New York January 20, giving it a market capitalization of $8.9 billion. RIM has lost 88% since its peak in 2008, when soaring BlackBerry sales pushed its market value to more than $80 billion. Last quarter, sales fell about 6 percent to $5.17 billion. Lazaridis, Balsillie and Stymiest all said the decision to step down was the men's own and not a response to outside pressure. The shift is a result of the company's evolution and the introduction of new technologies that will give RIM more competitive products, Lazaridis said. "This marks the beginning of a new era for RIM," he said in an interview. "It was a bit of bumpy ride. We've done it as best we could. Thorsten is the ideal choice. He has the right skills at the right time." RIM's share of the global smartphone market sank to 11 percent in the third quarter from 15 percent a year earlier, according to research firm Gartner Inc., stung by customer defections to the iPhone, and handsets that use Google Inc.'s Android software, including Samsung Electronics Co.'s Galaxy. The company faced a Jan. 31 deadline to report the findings of a review of its management structure. RIM agreed to the review to fend off an effort to overhaul management by investor Northwest & Ethical Investments LP, which had proposed the company split the chairman and CEO roles. "RIM had its era, but now it seems very hard to gain back market share in the smartphone market even if the top managers are changed," said Mitsushige Akino, who oversees about $600 million in Tokyo at Ichiyoshi Investment Management Co. "The iPhone and Android are well established in the market."

Still, other investors led by Jaguar Financial Corp. kept pushing for leadership changes and called for RIM to divide into separate companies, seek a merger or sell itself. Investors owning 8 percent of RIM supported the effort, Jaguar has said.

Blackberry maker RIM on the edge under new CEO Thorsten Heins
The new leader at Research In Motion said on Monday the Blackberry maker did not need seismic change, a declaration seized on by impatient investors who pledge Thorsten Heins will be an interim CEO if he does not turn RIM around in 12 to 18 months. Takeover talk swirled around RIM as Heins took the helm at the struggling company, whose co-CEOs Mike Lazaridis and Jim Balsillie finally bowed to investor pressure and resigned on Saturday. In a conference call early Monday morning, Heins, who joined RIM in 2007 and was previously a chief operating officer there, said he would focus on a consumer push and a smooth delivery of its products, rather than allowing a churn of innovation to disrupt rollout, as in the past. "We innovated while we were developing the product and that needs to stop," Heins said. "We need to innovate, don't get me wrong, but ... when we say a product is defined and a product is a product, execution has to be really, really precise." Still, the former Siemens AG executive hinted he would stick to the current strategy, saying the company needed scaling up, not a dramatic transformation. Lazaridis and Balsillie also gave up their position as co-chairman of the RIM board, but retained seats on the board, suggesting continuity was a goal. "I don't think that there is some drastic change needed. We are evolving .... But this is not a seismic change," Heins said. The changes at the top of RIM did little to reassure investors. RIM's U.S.-listed shares fell 6.4 percent to $15.90 in early trade on Monday. Key shareholders and analysts alike signaled they are impatient for drastic improvement at a company that has lost market share and market value after being comprehensively outplayed by the likes of Apple and Google. "If Thorsten really believes that there are no changes to be made, he will be gone within 15 to 18 months. He will be a transitional CEO and this will be a transitional board," said Jaguar CEO Vic Alboini, who leads an informal group of 16 RIM shareholders holding just under 10 percent of the company's shares.

Alboini criticized the retention of Balsillie and Lazaridis on RIM's board and called for several other board members to step down before the company's mid-year annual meeting. "If we're wrong, prove us wrong," Alboini said in an interview, referring to the group of shareholders who support his view. "This group is not going anywhere. This is just putting RIM in a position where it might be able to get back into the game. It's early days." RIM looks badly in need of a leader that can rejuvenate both the design and operational sides of the business or prepare it for sale to one of a raft of rumoured buyers, its critics said. "If there are no meaningful signs of an imminent turnaround then I think the spotlight will turn back on to the assets that RIM holds and who they might be attractive to," CCS Insight analyst Ben Wood told Reuters. "The annual analyst event in May will now become the focal point to the unveiling of Thorsten's vision. We know the speed with which you make strategic changes and implement them is absolutely critical because the mobile phone business will not stand still." On the surface, the former Siemens AG executive appeared to suggest he would stick to the current strategy, but analysts expect that to change in the coming months.

Challenges before RIM's new CEO

Bloomberg | Jan 23, 2012, 02.40PM IST NEW YORK: Research In Motion Ltd Chief Executive Officer Thorsten Heins brings decades of hardware experience as he seeks to revive a company outpaced by Apple Inc and Google Inc in mobile computing. Heins, who is replacing co-Chief Executive Officers Jim Balsillie and Mike Lazaridis, joined RIM four years ago after more than two decades at German engineering giant Siemens AG in roles ranging from research and development to product management. The 54-year-old German native was one of RIM's two operating chiefs, overseeing engineering, hardware and software. RIM, which helped pioneer the US smartphone market more than a decade ago, is betting on the management overhaul to stem falling sales and market-share gains by Google's Android and Apple's iPhone and iPad. Heins said that he promotes "creativity, innovation and free thinking" and that is ready to go head-to-head with the Silicon Valley rivals.

"We need to fight back and get stronger," Heins said in an interview. "You will see and hear much more from us." Balsillie and Lazaridis, who guided RIM together for two decades only to see an 88 per cent drop in the stock price since 2008, said the decision to step down and appoint Heins was theirs. Lazaridis, who founded the Waterloo, Ontario-based company in 1984, said the shift is a result of the company's evolution and the introduction of new technologies that will give RIM more competitive products. "He's really excelled in every department he's been responsible for," Lazaridis said. "He became the natural choice." Product delays Heins's top challenge will be to lead RIM's transition to next-generation products running on a new operating system, which has suffered from delays. In December, RIM said the first BlackBerrys based on the new system, called BB10, won't be available until the latter part of this year. The company also had a nine-month delay in getting e-mail onto its PlayBook tablet computer, RIM's response to Apple's market-leading iPad. The technical difficulties and marketing missteps have left PlayBook shipments at a little more than 1 per cent of those for the iPad. Heins said he plans to emphasize discipline in RIM's execution to make sure they company sticks to schedule. "When you say we're bringing a product to market, you make sure you execute," he said. At Siemens, Heins rose through the ranks of research and development, customer service, sales and product management. He ran several units of Siemens's communication business and also worked as the division's chief technology officer. Originally from Munich, Heins joined Siemens in 1984 after graduating from the University of Hanover. He is married and has two children, and his hobbies include bicycling, motorcycling, skiing and hiking. Heins's plan Heins said his role will be in taking RIM "to the next phase." Among his first moves, he said, will be hiring a new marketing chief to communicate with the consumer market. With the transition to the new operating system, Heins says RIM will be able to compete more effectively for the customers it has lost. RIM, which dominated the US smartphone market before Apple and Google entered it, had its share of sales drop to 16.6 per cent in the three months ending in November, according to ComScore Inc Google's Android raised its share to 46.9 per cent and Apple increased to 28.7 per cent.

"We will be working the consumer market not at the expense of the enterprise," Heins said. "I'm not here to retreat from the US market. I'm here to take it up."

The Canadian Government May Oppose A Takeover Of Research In Motion

he past year has been tough for BlackBerry maker Research In Motion (RIMM):

While Apple's (AAPL) iPhone and Google's (GOOG) Android gained market share in the U.S. in the most recent quarter, RIM saw its market share decline from 19% to 16% of U.S. smartphone customers according to the most recent ComScore numbers reported by CNET. Blackberry faced service outages and delays around the world in October. The company announced it would take a $485 million charge in December related to promotional action it would be taking due to its high inventory of Playbook tablets. And their co-CEO's recently resigned.

And as the stock price has declined on the Nasdaq from $70.54 last February to a closing price of $16.88 at the time of this article, the hope of a takeover by a larger company may have been on some investors' minds. These hopes may have dwindled last February when big player Microsoft (MSFT) announced a partnership with Nokia (NOK), and then later in August when Google announced that it agreed to acquire Motorola Mobility. Then in January of this year, Bloomberg reported that Samsung wasn't interested in buying RIM or using RIM's software through a licensing deal, leaving anyone dreaming of a takeover wondering which giant technology company, if any may be left as a possible candidate. And now, even if there is a company considering acquiring RIM, it may have an obstacle to consider, if it's not a Canadian company. Stephen Harper, Prime Minister of Canada and leader of the country's majority Conservative government, today indicated to Reuters that he did not wish to comment on or prejudice hypothetical transactions, but he would like to see Research in Motion continue to grow as a Canadian company. Since it was Harper's government that blocked BHP Billiton's (BHP) attempt to take over Potash Corporation of Saskatchewan (POT) in 2010, the takeover dream some investors may have for RIM might face a new uncertainty: whether the Canadian government would allow it. This added uncertainty of what the government would do in a hypothetical situation may be a good reason for RIM investors hoping for a takeover to consider the company's actual current and future prospects in the event it doesn't receive a takeover offer.

http://seekingalpha.com/article/340961-the-canadian-government-may-oppose-a-takeoverof-research-in-motion?source=yahoo

Research In Motion's Dangerous Waiting Game

EW YORK (TheStreet) -- Maybe the best indicator of how far Research In Motion(RIMM_) has fallen out of favor is that on a day when the Nasdaq Composite galloped to an 11-year high, shares of the Blackberry maker lost another 2% to close at $16.88, down nearly 73% in the past year.

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The main impetus for the weakness on Friday was a downgrade from Jefferies, which announced its move to underperform from hold in a research note entitled, "We Want to Believe ... But Just Can't Yet." The firm, which also cut its price target by 11.8% to $15 from $17, basically said it doesn't really see any good news on the horizon for RIM, especially if the crux of its strategy is to continue battling it out in the smartphone wars with Apple(AAPL_) and Google(GOOG_).

"Our checks indicate RIM will delay and possibly abandon its OS licensing plans and its email/BBM/social networking app in favor of direct competition with Apple/Android," With no near-term positive headlines now expected and with St. [Wall Street] still far too high for FY13 (Feb) at $3.17 vs. our $2.00 est, we cut our target to $15 and downgrade to Underperform as we await the BB10 launch (likely Sep)."

Jefferies had upgraded RIM to hold on Dec. 21, citing valuation with the stock trading below $13 at the time and a belief that the company was investigating potential partnerships and could announce a deal in the spring. Now, with the stock having jumped more than 25% since the start of 2012, boosted along with many of 2011's other big losers such as Bank of America(BAC_), First Solar(FSLR_), and Netflix(NFLX_), the valuation part of that equation is gone. Since the upgrade, the company has also named Thorsten Heins to be its sole CEO on Jan. 22, and it's still somewhat of a guessing game which strategic direction he plans to steer RIM. Heins has been meeting with analysts since he took the reins, and Jefferies said it came away from its pow-pow with him impressed with the man but not his near-term strategy. Instead of seeking to license BlackBerry 10 to Samsung and launching a messaging/email and social networking app for iOS and Android for a monthly fee, the firm expects Heins to present a new plan to RIM's board within two weeks to postpone or cancel those plans and instead "compete head-to-head with the Apple, Android, and Windows ecosystems with their own integrated hardware/software/services ecosystem." The street.com

Analyst Moves: RIMM, ANF

2/03/2012 @ 1:58PM |1,214 views

Analyst Moves: RIMM, ANF

+ Comment now Research in Motion (RIMM) was downgraded today by Jefferies (JEF) to underperform from hold with a price target of $15 price target, ad the company may delay or abandon plans to license its OS. Shares are lower by over 1.3 percent.

RIM sales pitch partly misses as analyst downgrades BlackBerry maker

At a cocktail hour in downtown Toronto Thursday, Research in Motion CEO Thorsten Heins sat down with a group of stock analysts for a question and answer session about his vision for the firms future. It was as much a sales job as an information session, say analysts who were at the meeting. And part of the Waterloo-based BlackBerry makers efforts to win over not just consumers, but the investment community. You have to face the music. They have to address the market, and they did, said Peter Misek, a technology analyst at Jefferies and Co. who attended the meeting, along with another 15-20 people. Thorsten was honest. He was very methodical. When he disagreed with something someone said, hed say `I respectfully disagree. In contrast former co-CEO Jim Balsillie would sometimes have testy exchanges with analysts during conference calls or meetings. Another analyst at the meeting was also impressed, adding, Thorsten actually answered most questions compared to Jims banter. But while Misek appreciated Heins style, he wasnt won over by his sales pitch. In a research report entitled We want to believe . . . but just cant yet, Misek downgraded RIM from hold to underperform, and slashed his price target for the firms shares to $15 from $17. I like Thorsten. I just happen to disagree with him, said Misek. What Heins was selling, largely, was the idea RIM wont be licensing its software out for use on competing smart phones at least for now. Instead, the company will be waiting to see how its new BB10 operating system does when released, likely later this year. There have been plenty of suggestions RIM would be better off licensing its software to companies like Samsung for use on Android phones, or even to Apple for use on iPhones, than keeping it only on BlackBerrys. RIM thinks they can get a better deal if its a successful system, said Misek, who believes the company should go ahead with licensing as soon as possible to keep its share of the lucrative corporate communications market. His report also states RIM is making a mistake by going on a marketing push before BB10 is available. RIM appears to be stepping up its marketing efforts, but we believe higher marketing spend without compelling products is not a recipe for success, Misek said.

The wait and see attitude on licensing likely isnt RIMs choice alone, argues Richard Tse, of Cormark Securities, who called the meeting with Heins neutral. If youre a handset manufacturer, why would you engage that system before you even know for sure if its going to be the real deal or not? said Tse, referring to RIMs longawaited QNX-based BB10 operating system. Tse, who rates RIM market perform with a target price of $19 per share, believes the company holds more value if its broken up into several pieces, either by the current owners, or if it gets taken over by an outside firm.

Will BlackBerrys reputation survive the crash?

Thestar.com Dear John letters took a 21st century twist yesterday as Blackberry users fired up their laptops to air their frustration over a worldwide, three-day service failure. Dear Blackberry ... you're trending! And we are THROUGH, wrote celebrity gossip blogger Perez Hilton on Twitter. You're still not working for me and Momma Perez is on her way to buy me the iPhone! Other posters claimed ruined social lives and demanded refunds to buy iPhones. Dear Blackberry, thanks for the new customers, sincerely, iPhone, wrote QuoteMuch. The service disruptions are the worst since an outage swept North America in 2009, but the landscape has changed since then, leaving Blackberry maker Research in Motion more vulnerable to criticism on social media sites like Facebook and Twitter, where Dear Blackberry, was a trending topic yesterday afternoon. The outage undermines the edge Blackberry always held over Apples iPhone, says Canada Marketing Magazine editor-in-chief Tom Gierasimczuk. Fast, encrypted, reliable messaging made Blackberry the phone of choice for business. It really fundamentally undercuts one of their few remaining brand promises, Gierasimczuk said. What are users left with now? In a note to investors yesterday, RBC Capital Markets analyst Mike Abramsky and associate Paul Treiber said the anger generated by the outages could drive some consumers to consider buying smartphones from Android or Apple.

It may also affect the progress RIM has made in the youth market in developing economies, attracted by its free BlackBerry Messenger (BBM) service and damage its reputation with governments in India and the United Arab Emirates, where RIM recently struck deals. These outages create another highly visible PR challenge, coming in markets where the company is still growing, according to Abramsky and Treiber. Edgar Baum, general manager for Brand Finance Canada, which rates Canadian brands based on forecasted revenues and royalties, among other factors, says this Blackberry outage is different. What makes this outage different is that they dont have the same monopoly in the business sector that they did. Blackberry was the business phone. Apple was a consumer toy, said Baum. But Apple has been making inroads in the business market and the outage may lead more businesses to question whether Blackberries really are more secure and reliable than iPhones. In September, Brand Finance Canada moved RIM from 5th to 10th place on its Top 15 Brands of 2011 list. Blackberry is a tremendous high-end brand which has faltered in the last 12 months, Baum said then. But it still has the opportunity to capitalize on its strengthsWe should never forget that Blackberry is a much loved brand worldwide.

The upside to BlackBerry outage: Fewer road accidents

http://www.thestar.com/business/article/1071392--the-upside-to-blackberry-outage-fewerroad-accidents There was an upside to last weeks Blackberry outage: In some countries, traffic accidents and fatalities plunged, according to reports. In the Middle Eastern cities of Dubai and Abu Dhabi, where Blackberry service was interrupted for three days, accidents fell by 20 to 40 per cent, according to the local English-language newspaper, The National. The roads became much safer when Blackberry stopped working, Brig. Gen. Hussein Al Harethi, director of the Abu Dabi police traffic department, told The National.

The impact in Toronto and the rest of the province, where Blackberry service was disrupted for less than a day, was unclear, local police said. The Ontario provincial police force said there were relatively few traffic accidents last week but it was not known whether that was related to the mobile phone outage. I didnt hear anything in relation to that, said OPP Sgt. Dave Woodford, spokesperson for the highway traffic division. The service disruption, which affected some 70 million Blackberry users around the world, was a public relations disaster for the Waterloo-based Research in Motion. The outage, caused by a faulty switch in the United Kingdom, could end up cost the company more than $110 million in lost revenue, one analyst estimated. But it may also have saved some lives. Police in Dubai and Abu Dhabi said they noticed a significant decline in traffic accidents involving young men, the group most likely to be using a Blackberry while driving, during the outage. Traffic accidents fell 20 per cent in Dubai and 40 per cent in Abu Dhabi, police said, and there were no fatalities. On average, there is a traffic accident every three minutes in Abu Dhabi and a fatality in Dubai every two days, police said. Both countries have recently launched crackdowns on cell phone usage in cars. In Ontario, talking or texting on mobile phones has been illegal for almost two years, since Oct. 26, 2009. The fine for doing so is $155. However, many people still do it, including Toronto Mayor Rob Ford, who was accused by Ottilie Mason of giving her the finger when she asked him to put down his phone while driving in downtown Toronto last July. During a crackdown on distracted drivers during the second week of September, Ontario provincial police laid 165 charges and said mobile phone usage was a factor in two of six fatalities that week. Toronto police said it was too early to tell what the impact of the Blackberry outage had been on local traffic accidents. Traffic services file their reports every two weeks, spokesperson Sgt. Tim Burrows said, so we wont know for a few more weeks.

RIMs challenge: Keep teenage BlackBerry texting addicts, Bay Street bankers, add iPhone, Android fans.
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RIMs challenge: Keep teenage BlackBerry texting addicts, Bay Street bankers, add iPhone, Android fans.
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Francine Kopun Business Reporter More about

RIM
Nicole Tollefson uses her BlackBerry Bold to keep up on her Grade 11 math homework, but she raves about her iPhone. Her BlackBerry is efficient at messaging and makes it easy to participate in groups. If Tollefson has a math question, she sends it out to 11 other members in her math class group who also have BlackBerrys. She uses BlackBerry groups to keep up with her fashion show committee work at school. But as soon as her friends update to iPhones, shell be dumping her Bold. The iPhone is so much easier. Its faster, I can have my music on it, my photos. Its faster on the Internet. I dont bother going on the Internet anymore with the BlackBerry because its way too slow, says Tollefson, 16. Tollefson embodies the challenge that Research in Motion faces. Tollefson liked her Bold when she got it three years ago. Now Research In Motion has to woo her back. Whether RIMs new line of smartphones will be able to win back consumers remains to be seen. Kevin Michaluk is a believer. A founder of Crackberry.com, a website for fans of BlackBerry products, Michaluk thinks the smartphone platform RIM is trying to push out this year will reclaim lost fans and win new ones.

Its not just that the BlackBerry 10 will look slick if a leaked photo of the new phone is authentic, the new BB 10 will be sleek and slim, with the kind of big, new high-definition screen found on the Galaxy that is already making the iPhone 4s look a little dated. It will also be the first BlackBerry phone designed specifically with consumers as well as corporations in mind, says Michaluk. RIMs initial foray into the smartphone market the Storm was a buggy disaster, mostly because it was old technology warmed over. The QNX platform promises to deliver a totally different user experience. BlackBerry is also aggressively wooing app developers, promising those who submit an Android app to BB AppWorld by Feb. 13 will get a free PlayBook. The PlayBook, RIMs answer to the iPad, sold so poorly before Christmas it had to be deeply discounted, and is now available for hundreds less than its original list price. Theyre taking the best things you know from the BlackBerry of the past and bringing it to this platform, which is designed for the next decade and beyond, he says. Hes expecting a phone that will be able to run multiple applications at once, and the ability to move easily between the applications, which is a feature of the PlayBook. If you use a PlayBook for a while and you go back to the iPad, the iPad feels old now, says Michaluk. He believes the new BB will bring new value to the market. While Android phones are competing for consumer dollars with gimmicks like face recognition, the BlackBerry will offer more meaningful value. The criticism of the BlackBerry has always been the browser is slow and there arent many applications. The new phones will address both those issues, says Michaluk. I think once they close all their gaps, they will get attention. The good news for RIM is that its brand remains solid in a number of key sub-markets. In addition to messaging-obsessed teens and security-conscious financial sector buyers, the BlackBerry is still a staple in government, health care, and other key verticals, says technology analyst Carmi Levy. He says RIM needs to develop niche marketing to appeal to their different customer groups. RIM can't afford to fly at 50,000 feet anymore.

Rim CONFIDENCE DROPS As Research In Motion Ltd. scrambles to repair an extensive series of lingering service blackouts around the world that have left millions of BlackBerry owners in the dark without access to emails or instant messages international confidence in Canadas technology champion continues to plummet. On Wednesday, blackouts which began Monday in Europe, Africa and the Middle East spread to North America, knocking BlackBerry users in the United States and Canada offline. Service disruptions were also reported in South America, Hong Kong and Japan. As annoyed BlackBerry users around the world took to Twitter and Facebook to vent their frustrations and mock the Waterloo, Ont. company, RIM said it was working night and day to correct the problem, which the company said was caused by a core switch failure within its own infrastructure. According to London daily newspaper The Guardian, RIMs operations at its U.K. headquarters in Slough, Berkshire, suffered a Chernobyl moment computer crash on Monday at 11 a.m. local time, disrupting BlackBerry services for millions of users. The crash reportedly occurred as RIM was attempting to upgrade its software and hardware infrastructure. The messaging and browsing delays that some of you are still experiencing were caused by a core switch failure within RIMs infrastructure, RIM said in a statement released Wednesday. Although the system is designed to failover to a back-up switch, the failover did not function as previously tested. As a result, a large backlog of data was generated and we are now working to clear that backlog and restore normal service as quickly as possible. RIM declined to comment further on the service outage or to make a spokesperson available. For RIM, the service blackout the most serious for the company since December, 2009 marks the second time in less than a month that BlackBerry users were unable to access their data, dealing a huge blow to the BlackBerrys reputation as a reliable, always-on messaging technology.

Making matters worse for the company, this week, RIMs chief rival Apple Inc. is making the latest version of its mobile operating system, iOS 5, available to iPhone users. The new software includes iMessage, an instant messaging technology that is exclusive to Apple devices and that duplicates many of the same features offered by RIMs BlackBerry Messenger platform, a key differentiator for the company. For many years, one of RIMs key advantages over its smartphone maker competitors was its system of Network Operating Centres (NOCs), which power the companys wireless email system and provide a direct link between the company and the BlackBerry Enterprise Software tools that organizations can install inside their IT departments to connect and run individual BlackBerry devices. RIM reportedly maintains two NOCs in Waterloo one that powers North American email traffic and a second for the Asia-Pacific region with the U.K. NOC providing a routing station for email and BBM traffic in Europe, the Middle East and Africa. RIMs network of NOCs, as well as their reliability during times of heavy traffic, such as during the 9/11 terrorist attacks in 2001, was part of what helped the company build its reputation as a critical enterprise technology, and allowed the BlackBerry to become the default smartphone for Wall Street bankers, law enforcement officials, and politicians in Ottawa and Washington. As the disruption hit North American users on Wednesday, the news caused investors many having already lost confidence in RIMs business this year after a series of missteps to send shares of the BlackBerry maker down more than 4% at one point in Toronto Stock Exchange trading, as observers once again raised questions about the very core of RIMs technology. RIM shares finished the day at $24.27, down 87 cents, or 3.46%. While RIM attributes the fault to an unforeseen technical issue, the outages sustain investor concerns over the company regarding the value and relevance of RIMs proprietary network architecture, RBC Capital Markets financial analyst Mike Abramsky wrote in a note to clients.

On one hand RIMs network enables BBM messaging and data carriage with high efficiency, encryption and offloads carrier bandwidth but also affects many more users when it goes down vs. having each carrier manage messaging for competitors, which may be less efficient/secure, but offers more redundancy.

RIM's challenge is new products, not marketing: analysts

Read more: http://www.ctv.ca/CTVNews/SciTech/20120130/RIM-challenges-products120130/#ixzz1lSWN1Uwl

Research In Motion's new marketing campaign to attract more consumers in the United States only calls attention to its lack of new smartphones and its vulnerable position in the marketplace, analysts said Monday. "It's like saying, 'I am wounded, please look at me,"' said Raymond Pirouz, who lectures in marketing and new media at the Richard Ivey School of Business at the University of Western Ontario. Research In Motion (TSX:RIM) has launched its "Be Bold" campaign aimed at increasing its shrunken U.S. marketshare with TV advertising and through digital and social media platforms to promote its flagship BlackBerry Bold smartphone. But with RIM"s new generation of smartphones not expected out until later this year, Pirouz says consumers are being asked to buy BlackBerrys that are already on the market. This kind of promotional marketing isn't going to go beyond the company's user base, Pirouz said. "Product development, app development, ecosystem development -- that kind of marketing, the fundamental stuff -- is their problem," Pirouz said from London, Ont. "It's calling extra attention to themselves at a time when they're vulnerable." Meanwhile, shipments of Apple's iPhone accounted for one in four smartphones during the fourth quarter ended Dec. 31, said mobile analyst firm Juniper Research. In the United States, only about 20 per cent of BlackBerry users have RIM's latest phones. PCMagazine mobile analyst Sascha Segan said RIM needs new products with its new operating system that give consumers a great gateway to the web, apps and social networking. "RIM's problem isn't the marketing, it's the products," Segan said from New York.

The current BlackBerrys are "an evolution of every previous BlackBerry and the U.S. market is not that excited about it," he said. "If you don't have the new products, them marketing is what you have to fall back on," Segan said. Responsibility for the campaign will likely fall on the shoulders of RIM's new chief executive Thorsten Heins, who recently replaced co-CEOs Jim Balsillie and Mike Lazaridis. Heins, who had been part of the RIM senior management team since 2007, said after the Jan. 22 appointment that marketing would be one of his priorities. RIM had already said in December it would focus on regaining ground south of the border. Read more: http://www.ctv.ca/CTVNews/SciTech/20120130/RIM-challenges-products120130/#ixzz1lSWR0H00

The diagnosis for Research In Motion: acute Founderitis michael posner

http://www.theglobeandmail.com/report-on-business/the-diagnosis-for-research-in-motionacute-founderitis/article2318148/page2/ On what planet? an incredulous Ms. Comaford asks. Drastic change is totally needed. Management is out of touch. It has low emotional equity with customers, with the market and with internal staff. There's no marketing evangelism and there's no innovation. Its turnaround plan is vague and ambiguous. Of course, RIM is only the latest casualty of a syndrome that has plagued the high-tech universe, where the frightening pace of change threatens to render even startling innovations commercially irrelevant. Hubris typically figures prominently. Consider Jerry Yang, co-founder and former CEO of Yahoo Inc. Wedded to his convictions about the company's value, he spurned a 2008 takeover offer from Microsoft that valued Yahoo at a staggering $44.6-billion. Afterward, its shares plummeted and are now worth about half that amount. When, earlier this month, Mr. Yang resigned from the company, the stock immediately jumped 4 per cent. Or consider the late Steve Jobs, visionary co-founder of Apple. He was forced out by the same CEO he recruited, John Scully, in 1985, after his imperious behaviour alienated huge swaths of the company's staff. Mr. Jobs seemed to have learned the lesson. His second coming at Apple, from 1997 on, produced a stock bonanza. And, as his health declined in

2011, he effected a smooth leadership transition, anointing COO Tim Cook as his successor. For RIM and other victims of the syndrome, it doesn't have to be this way, Ms. Comaford insists. Founders can inoculate themselves. The key is to establish a vibrant set of outsiders who ask tough questions. People on company boards tend to go native' after 90 days. They want to be part of the tribe. They drink the Kool-Aid and keep asking for more. We need people who want water instead. Prof. Wasserman concurs. RIM became dominant by successfully navigating the treacherous shoals that threaten founders, he says. Mr. Lazaridis recognized his own limitations and, in 1992, brought in Mr. Balsillie to fill in the gaps. Then, they adopted and sustained an unconventional and often unworkable coCEO management structure. That, too, makes it an outlier, very unusual, Prof. Wasserman says. But you do need people internally who push back and consider not just about the best-case or expected scenarios, but worst-case situations, where you might have to adjust the vision radically. It's the founder's baby. But he may need to change his approach to parenting, or find an adoptive parent to take it to the next stage. For Mr. Balsillie and Mr. Lazaridis, founder push eventually came to founder shove. What remains to be seen is whether it came too late to save the company. On what planet? an incredulous Ms. Comaford asks. Drastic change is totally needed. Management is out of touch. It has low emotional equity with customers, with the market and with internal staff. There's no marketing evangelism and there's no innovation. Its turnaround plan is vague and ambiguous. Of course, RIM is only the latest casualty of a syndrome that has plagued the high-tech universe, where the frightening pace of change threatens to render even startling innovations commercially irrelevant. Hubris typically figures prominently. Consider Jerry Yang, co-founder and former CEO of Yahoo Inc. Wedded to his convictions about the company's value, he spurned a 2008 takeover offer from Microsoft that valued Yahoo at a staggering $44.6-billion. Afterward, its shares plummeted and are now worth about half that amount. When, earlier this month, Mr. Yang resigned from the company, the stock immediately jumped 4 per cent. Or consider the late Steve Jobs, visionary co-founder of Apple. He was forced out by the same CEO he recruited, John Scully, in 1985, after his imperious behaviour alienated huge swaths of the company's staff. Mr. Jobs seemed to have learned the lesson. His second coming at Apple, from 1997 on, produced a stock bonanza. And, as his health declined in 2011, he effected a smooth leadership transition, anointing COO Tim Cook as his successor.

For RIM and other victims of the syndrome, it doesn't have to be this way, Ms. Comaford insists. Founders can inoculate themselves. The key is to establish a vibrant set of outsiders who ask tough questions. People on company boards tend to go native' after 90 days. They want to be part of the tribe. They drink the Kool-Aid and keep asking for more. We need people who want water instead. Prof. Wasserman concurs. RIM became dominant by successfully navigating the treacherous shoals that threaten founders, he says. Mr. Lazaridis recognized his own limitations and, in 1992, brought in Mr. Balsillie to fill in the gaps. Then, they adopted and sustained an unconventional and often unworkable coCEO management structure. That, too, makes it an outlier, very unusual, Prof. Wasserman says. But you do need people internally who push back and consider not just about the best-case or expected scenarios, but worst-case situations, where you might have to adjust the vision radically. It's the founder's baby. But he may need to change his approach to parenting, or find an adoptive parent to take it to the next stage. For Mr. Balsillie and Mr. Lazaridis, founder push eventually came to founder shove. What remains to be seen is whether it came too late to save the company. Michael Posner is a feature writer for the Globe and Mail.

Two Reasons Why RIM Is Still Worth Buying

Research in Motion (RIM), the maker of BlackBerry smartphones, may seem like a dinosaur in todays flashy mobile market, but Tony Bradley thinks they still have a lot of untapped value. First off, he notes, RIM has a very large customer base of companies, and government agencies that fit this description. These organizations might not be committed to the BlackBerry platform so much as theyre reluctant to abandon their investment in the BlackBerry infrastructure. If a company can buy RIM, and give those customers a smooth path to transition to a better mobile platform, it will strike gold. As Bradley points out, this is easier said than done. Trying to integrate some other mobile platform in a way that might let customers continue to use their existing BlackBerry infrastructure may not even be technically feasible, he writes. But, even if it cant be merged, the purchasing company can still provide discounts and incentives for those existing customers to transition to a new platform by attrition as BlackBerry licensing and support expire.

RIM: A Valuable Asset; If Only There Were Any Buyers Eric Savitz Forbes Staff

W hy Apple's Valuation Is On The Decline E.D. Kain Contributor

The other potential treasure in the RIM portfolio? Technology patents. Its a sad argument to have to make, but as Bradley points out, in this era of the patent arms war and the strategy of mutually-assured destruction through patent litigation, any patent portfolio is a good patent portfolio. Think of Google buying Motorola, not so much because they wanted to be a phone manufacturer, but because of Motorolas vast patent trove. Its a bit like breaking windows just to fix them again, but Bradley is absolutely correct: were neck deep in the age of patent wars, and buying companies just to get a leg up in the patent battlefield actually makes a lot of sense.

In Germany, courts have upheld a ban on the tech giants Galaxy Tab due to patent suits leveled by Apple. Similar suits exist across the EU and elsewhere. No end is in sight without serious, global patent reform. Its a sad testament to the modern tech industry that the once-great Blackberry manufacturer might be worth more due to its IP than its actual product line. Whether a potential RIM purchaser could capitalize on its existing customer base, transitioning them away from Blackberry and onto some other platform, is a tricky question and potentially a very big risk. But those patents are another story altogether. http://www.forbes.com/sites/erikkain/2012/02/01/two-reasons-why-rim-is-still-worthbuying/ Here's a friendly warning to all technology companies eyeing Research In Motion: Back away slowly. Apparently, RIM drew its fair share of suitors over the last few months, with companies including Amazon, Microsoft, and Nokia weighing potential offers for the BlackBerry maker. The talks, however, never got serious enough to warrant a formal proposal. It's clear why any company would consider buying RIM. For one, it's extremely cheap, having lost more than three-quarters of its market value over the past year. Despite its declining brand, the company still boasts an impressive array of business customers. For all the talk of doom and gloom, its subscriber base still grew 35 percent to 75 million--with much of that expansion coming from overseas. Outside of a few outages here and there, RIM's security and e-mail system is top notch. Yet, RIM would make for a complicated and frustrating acquisition for any technology company bold enough to make an offer. RIM's core business is built on top of an operating system that is years too old to be on the market, and is dragging its feet on its move to the next-generation platform. Whatever design acumen it used to have has largely faded away. Lastly, it is suffering from an identity crisis: is it focused on business, the consumer, or some halfhearted mash-up of both? OK, so pondering an acquisition is a bit moot since RIM has so far insisted on remaining independent. But the company's management recently expressed a willingness to at least consider other options, and shareholders have certainly cried out for a potential takeover to bail out their sunken investments, so it's worthwhile to run through the various scenarios based on the rumored acquirers--as well as add some ourselves. Would you buy a KindleBerry? Amazon considered making an offer for RIM over the summer, Reuters reported yesterday. At first glance, such a deal would be a head-scratcher. Amazon is a retail company focused

on the consumer, while RIM's last bastion of users remains the corporate white collar army (and even that is starting to erode).

The Kindle Fire looks a lot like the RIM PlayBook. (Credit: Amazon) But if you dive deeper, you start to see how the two fit. Amazon runs a lucrative cloud services operation that caters to businesses, which falls alongside RIM's own businesscentric model. RIM's security, messaging, and network services could be layered on top of that, allowing Amazon to offer new services and expand its customer base to larger corporations and government agencies. RIM offers a ton of wireless know-how and relationships with carriers--crucial to Amazon if it wants to expand the distribution for its Kindle Fire and future mobile devices. An acquisition would also give Amazon instant access to millions of users--all potential online shoppers. Amazon, however, would be better off on its own. The company is on a solid run with hot products like its regular Kindle e-reader and the Kindle Fire tablet--it doesn't need the distraction of a large acquisition and the potential integration of a completely different corporate culture. The Kindle Fire uses essentially the same body as RIM's PlayBook tablet (with cheaper components), yet has been phenomenally successful because of its low price tag and access to Amazon Prime services. Fittingly, RIM has had to offer massive discounts to get its PlayBook to $200--the same price as the Kindle Fire--finally convincing consumers that it was worth their money. Amazon has already put considerable resources behind its own flavor of Android, which is heavily customized to the point where it is unrecognizable. Amazon doesn't need to inherent the old BlackBerry 7 platform, and likely wouldn't know what to do with QNX/BBX/BlackBerry 10. It's unclear how, or if, Amazon would mash up the Kindle with the BlackBerry.

The three amigos: Microsoft, Nokia, and RIM In contrast, a deal with Microsoft and Nokia makes more sense on a higher level, with the two reportedly considering a deal before dismissing it a few months ago. Microsoft has long been a rumored acquirer of RIM, and with their mutual focus on business customers that makes sense. Microsoft could bundle its software and services alongside RIM's BlackBerry phones and network.

The Nokia Lumia 800 would have never happened if Microsoft and Nokia pursued RIM instead. (Credit: Nokia) Nokia, prior to hopping on the Windows Phone bandwagon, was in need of a nextgeneration platform, which RIM could potentially offer in the form of BlackBerry 10. RIM, already a player overseas, would get parents with even more considerable global reach. But the combination between the three would have been a disaster. Individually, each company was reeling from the competitive threat posed by Google and Apple. Together, the three would have created an even slower, more lumbering player hampered by its own size and clashing corporate cultures. Joint ventures rarely work (ask Sony about Sony Ericsson), and this wouldn't have been an exception. For instance, which operating system would the three have used? Windows Phone? BlackBerry 7? BlackBerry 10? Would Nokia take on the BlackBerry brand? These are questions better left unanswered. If CNET bought RIM OK, so if we theoretically took up a collection to buy RIM, what would CNET do? I shot around a number of ideas with ZDNet's Larry Dignan, who posted his own suggestions to save RIM here, and we came up with the same conclusion: hop on the Android bandwagon. RIM needs to move quickly, which means BlackBerry 10 coming late next year just won't cut it. So instead, I would use a ready-made mobile operating system in Android, and focus

on what makes RIM great: awesome e-mail; secure networks and business-class servers; and the network of BlackBerry Messenger users. Rather than focus on hardware, I would turn all of those services into apps that can easily be loaded onto Android phones, and continue to generate revenue through service fees. To retain the BlackBerry brand, RIM could create a BlackBerry variant of the Android software (if Amazon can do it, why can't RIM?), and outsource the hardware business. RIM has too many products with too many confusing names in the market, so the lineup would have to be trimmed down to just a few products addressing a specific segment, from high-end corporate workers to mass-market consumers. RIM could take advantage of the vast library of Android apps already in the market, as opposed to convincing developers to take a gamble on an unproven platform. As for BlackBerry 10, or QNX, RIM should abandon using it as a smartphone platform and continue licensing it out for other uses. If that doesn't work, there wouldn't be any other choice but to break up and sell the company in pieces. Its intellectual property alone makes it a worthy acquisition. Which is likely why RIM has so many bidders knocking at its door.

The big problem with buying RIM is that there isnt only one big problem
As RIMs sales sputter and its market value falls, potential buyers are starting to sniff around. Reuters reports that Amazon took a look this past summer. The WSJ reports that Microsoft and Nokia have considered a joint bid for RIM. Other potential buyers, Id guess, could include Oracle, Microsoft-without-Nokia, one of the Chinese telecom gear makers, privateequity turnaround shops, and maybe even Apple (at the lowest possible price, so probably not). Theres no question that RIM is worth something:

It has more than a decade worth of mobile and smartphone patents, including a stake in the Nortel patent auction spoils, Almost $20 billion in annual sales, Some 75 million subscribers, including many huge corporate customers, And its still profitable. Its QNX next-generation operating system core exists, and has nothing to do with Android or the patent problem with Microsoft yet. A company like Amazon

could conceivably slip it under the hood of the Kindle Fire, replacing Android. It might even be able to emulate Android apps until developers switch over to the new system. RIM has worldwide distribution and carrier relationships, and the foundation of a decent smartphone business. It has the basis of potentially interesting platforms, such as BBM. It makes nifty little plastic keyboards that some people still think they need.

But RIM also has real problems, most of which are plaguing its ability to reinvent itself, and many of which will transfer over to its new owner:

Most important, RIM seems lost. It appears to be incapable of delivering presentday smartphone and tablet engineering, software, ecosystems, and design. Its not just that the BlackBerry and PlayBook arent as pretty as Apples iPhone or even Google Android devices its that they are only a fraction as powerful, useful, and elegant. RIMs two CEOs, who led the company through its first boom, are still in charge. And for years, they seem to have been oblivious or in denial of RIMs declining competitive position. The board, apparently, still has their back. (And probably needs to go, too.) But replacing them will also be a mess. So, what to do? RIM, based in Waterloo, Ontario, is quite far from the excitement and talent pool in Silicon Valley, which has led the recent wave of mobile innovation. Isolation probably isnt a good thing in this case. RIMs buyer will have to figure out whether to slim down its HQ and relocate costly in many ways or to try to rejuvenate it within Canada. But its not like Amazon or Microsoft would be buying a huge Silicon Valley mobile R&D center here. With RIMs decline, theres little reason for developers to care about making great apps for the BlackBerry. Some companies still invest in BlackBerry apps, but some of the top apps Facebook and Twitter, for example are still made by RIM itself, in partnership with the companies. RIMs growth is increasingly coming from emerging markets and lower-end devices. Things in the U.S. are so bad that its native Canada has recently grown as a percentage of revenue. (7.5% of sales over the past 9 months, up from 7.1% during the year-ago period.) The BlackBerry brand, once a cool mark, is now seen by many as second-rate. This isnt totally unfixable, but its yet another uphill battle.

And then theres the problem that RIM keeps getting cheaper. When I first argued in 2009 that Microsoft should buy RIM, its market cap was $21 billion, the company was still growing, and Microsoft probably would have had to spend $35 billion to get the deal done. Today, RIMs market cap is $7 billion. Absent a bidding war, it might be had for $10 billion, if the board could be talked into it. But it is also in decline, with slim odds of recovery. Maybe in another six months, itll be even less expensive.

So, well see. I wouldnt bet money on RIM being able to fix its problems by itself. But its also still probably too expensive for most buyers knowing that its probably going to get cheaper, and that hacking it up is going to be messy. Barring a miracle, its hard to see a happy ending here. And its sad. But the technology industry has a crazy way of destroying its laggards. And, on the bright side, perhaps this will soon lead to a bustling startup scene in Waterloo.

RIMs rise and decline: A 10-year view

BlackBerry maker Research In Motion is a classic example of a company that had one great idea, grew huge because of it, but couldnt save itself as the industry moved on. And now for the first time ever, RIMs sales will probably shrink this fiscal year despite continued rapid growth in the smartphone industry. Its past is an impressive one: From $300 million in sales during fiscal 2003 to $3 billion four years later. RIM even continued to grow after Apple stunned the industry with its iPhone in 2007, peaking at almost $20 billion in sales during fiscal 2011, which ended this past February. But behind the scenes, things were falling apart. RIMs growth was downshifting, and its new sales were coming from lower-end devices in emerging markets. Now, almost 60% of RIMs sales come from countries other than the U.S., U.K., and Canada a dramatic change from just a few years ago. It will take a miracle to save RIM now it still hasnt been able to develop any compelling new products, and the industry continues to move on, led by Apple and Google. Most impressively, RIM is still quite profitable, and just reached 75 million subscribers. And as its value shrinks, theres a chance RIM will be acquired for its customer base, intellectual property, and/or infrastructure. But either way, its probably going to be a sad end to what was once such an impressive growth story.

RIM is Parable
Here are the highlights from RIMs latest quarter:

14.1 million BlackBerry smartphones shipped, 13 million sold through 150k PlayBook shipped with sell-through slightly higher. 800k PlayBooks shipped so far. BlackBerry subscriber base up to 75 million High growth cited for U.K., France, South Africa, Mexico and Argentina, Indonesia, Saudi Arabia and South Africa. RIM is the #1 smartphone vendor in the Latin America and Caribbean region. Sales outside the US, UK and Canada were 61% of revenues. US is now 20% of sales, UK 11%. Hardware growth outside the US was 56% There are 630 carriers 50k apps in App World with 5 million downloads per day Forecasting 11 to 12 million smartphones next quarter

Given the channel fill with a new product, the device business was marginal at best. The company obtained -1% growth y/y in units but 31% sequential growth from a transitional quarter. The average selling price (inclusive of service revenues) is $354 and about $280 excluding service revenues. I estimate that operating margins have dropped to about 11%. Not a good story, but one we have been warned to expect. But a crucial new twist to the story is that RIM announced that they dont expect new BlackBerry 10 devices until late next year. That came as a surprise and the stock sold off significantly, valuing the company at well below book value. Stepping back, the biggest surprise is that the company seems to have had no plan for sustaining itself. Let me explain. If you go back to 2005 or so the world of smartphones was a mix of modular OSs and integrated platforms, much as it is today. Not unlike Android today, Windows Mobile was successful in licensing to dozens of vendors who in turn released hundreds of products. Symbian also was licensed but most volumes came from Nokia and they held the lions share. Then there was the BlackBerry integrated solution which worked smoothly and had devoted fans who upgraded every chance they had and operators who were joyous at the new ARPU. There was also PalmOS as offered by PalmSource trying to be a third horse and unseat stodgy old Microsoft. It was into that fray that both Apple and Google jumped. Google acquired Android in 2005 and Apple was busy polishing a version of OS X that would became iOS. In three and two years respectively these platforms would be in the market.

Regardless of the actions of rivals, all competitors must have faced the same questions in 2005: As technology was changing rapidly and as they all had access to component roadmaps, what is the best technology approach to this market? Should they embrace certain innovations to sustain their business trajectory? RIM had a tightly integrated software, hardware and service offering. What could make it better? Nokia was also basing its products on a more loosely integrated offering (nominally it was modular, but only just). It saw the writing on the wall and began developing a Linux variant (Maemo) as a potential candidate to replace Symbian. Microsoft was basing its solution of a modular approach. Windows CE was ok as a kernel but they had layers on top which were optimized around stylus-based user experiences (analogous to mouse actions). Could it take on a rich computing experience? There were many experience candidates. Stylus, keypad, keyboard all had adherents. There was a lot of hesitation. After the iPhone launched with capacitive (finger) touch, resetting user expectations, it still took a year for many of the vendors to re-consider their technology plans. The weakest changed first. Microsoft felt the pain quickest. They also had the least to lose since revenues from Windows Mobile were paltry. By 2008 internally they turned 90 degrees. They embarked on re-building their user experience and orphaning the Windows Mobile ecosystem and many of the vendor relationships they had built. Palm dropped PalmOS and built WebOS internally quite quickly. They licensed Windows Mobile as a stop-gap. Around the same time Nokia doubled down on Maemo and joined with Intel to form MeeGo. They did not orphan Symbian though and kept trying to adapt it to the new experiences and input methods. But RIM did nothing. Almost nothing. They were the healthiest competitor. They felt no pain from iPhones entry. The platform they had built was still growing and they were tweaking it constantly. There were always improvements to point to but fundamentally the code was limited. It was very difficult to adapt it to touch input and the first attempts at a touch UI were embarrassing. But there were no signs of a new platform that reflected the Unix-like competition. As I pointed out in an earlier post, Unix-like operating systems were having their revenge. To a computer scientist the future of mobile computing would mirror that of personal computing in terms of architecture. The foundations of the early smartphones were built on constraints that were disappearing while being unable to accommodate new input methods. In other words, the early efforts were optimized around those constraints and sub-optimal for rich user experiences. They had to be. There were limited processors, memories and screens and battery life. It turned out that all the early mobile operating systems were unsuitable for the advances in technology that came after 2007. Companies which were able to adapt or embrace Unixlike operating systems in a mobile context gained the ability to grow with the new input methods. The sooner they pulled the trigger on the shift, the better off they were. This is in fact what enabled entrants to gain footholds. Entrants entered with Unix-like OSs

straight away while incumbents had to justify changing and the more successful they were the harder it was to justify changing. RIM had trouble justifying this change. It waited until 2010 to finally acquire the QNX asset that would offer them a stronger software foundation. It still had to adapt this acquisition and it looks like it wont be done until at least 2012, seven years after they should have started. And this should be seen as a sustaining technological change. A new OS is not a disruptive technology to what is already a mobile computer. However, delays like these can be fatal. We see the impact on Microsoft who was earliest to push the reset button in 2008. It still took two years to rebuild Windows Mobile into Windows Phone and is now still struggling to regain lost share (less than 2% today). We see the impact on Nokia which was unable to affect a transition to MeeGo due to a litany of issues and had to throw in the towel on self-determination. We see the impact on Palm which lost its independence as WebOS was a bit too little too late. These companies had the right technical strategies but suffered from execution and business architecture issues. RIM is years late in embracing what appears to be a sustaining improvement. But whenever you see what appears to be a coordinated effort by companies to fail simultaneously you have to ask if the change they struggle with is really sustaining or disruptive. The pattern makes me suspicious that what RIM, Microsoft, Palm and Nokia faced was more than a failure to embrace a sustaining improvement. I suspect that the failure is evidence of tectonic shifting of business models.

RIM's A Buy, With Compelling Risk/Reward After Weak Earnings

How the mighty have fallen! Over the last two years, long-term equity holders in Research in Motion (RIMM) have experienced an 80% decline in the value of their position. Let's put this drop into perspective: Below is a two-year chart comparing RIMM's performance versus the S&P 500 (SPY), Nasdaq (QQQ), and the S&P Technology (XLK) indices:

Now let's compare a 5-year performance chart comparing RIMM's performance to competitors Motorola (MMI), Nokia (NOK), LM Ericsson (ERIC), Google (GOOG) and Apple (AAPL):

The chart seems to state that Research in Motion, Nokia, and Ericsson are on their deathmarch. I was previously quite bearish on the stock as it descended from $60 to $20 ... and now to $14.30 in after-hours trading Thursday. But around $15, I began to get constructive.

Why? While the market focuses on its income statement, I focus on Research in Motion's balance sheet. There is an asset play here. Let's be clear -- the stock was not a steal at $30, but at $14.30, Research in Motion is a bargain, trading near its tangible asset value. Stop and think about that for a second: Research in Motion is trading at its net assets on its books, half of which is cash and receivables. Questions about the earnings power are less relevant at this price- Research in Motion only needs to break even for you to have valuation protection. You get any upside in turnaround, brand value, and patent value for free. Sounds like a good deal to me. Research in Motion is an asset play, an intriguing opportunity for the long-term value investors. Additionally, all of Research in Motion's valuation multiples signal the market's pessimism for Research in Motion's future prospects (source: Yahoo Finance): P/E (ttm) P/E (FY1) P/B EV/EBITDA 2.8 3.9 0.8 1.4

There are two potential explanations for these remarkable numbers: Research in Motion is either cheap any way you look at it, or a value trap. From a risk/reward perspective, I believe Research in Motion's stock is currently cheap, with the potential to become absurdly cheap. Lets not sugarcoat it -- the competitive landscapes for BlackBerry products are bleak. Management at Research in Motion did not anticipate the recent market shifts. Research in Motion's management was outmaneuvered by Apple's iTunes and Google's Android market ecosystem, and its competition is intense, well-capitalized and innovative. Stipulated. So let's take a step back and get to the numbers. I calculate we are nearing the price at which all of these stipulations are moot. I am talking about the liquidation value of RIM's shares -- the lowball price at which you sell the company's assets in a firesale. While few people believe that RIMM, despite its many challenges, will exit the cellphone business entirely, the liquidation value serves as an important valuation support level. I estimate RIM's breakup value to be roughly in the range of $11-$13 per share. I know what you're thinking: Things must really be bleak for an equity guy to be looking at a balance sheet. Since the accepted wisdom is that RIM is in terminal decline, it is instructive to estimate how a distressed investor might value the shares. Here's the math -- I show the most recent as-reported Balance sheet, liquidation haircut (discount the item would fetch in a firesale), and the Liquidation Value of each asset item. Assets As of February 2011 Liquidation Haircut Liquidation Value

Cash & Short-term investments Receivables Inventory Long-term Investments PP&E Goodwill & Intangibles Total Assets Total Liabilities Total Shareholder Equity Net Tangible Assets Per-Share Value

2121 4508 618

100% 95% 50% 80% 95% 80% 0%

2121 4283 309 193 548 2003 0 9457

Other Current Assets 241 577 2504 2306 12875 3937 8938 6632 $12.75

100%

3937 5520 5520 $10.68

Figures in $ thousands. These are my numbers, and you may have a different view on the liquidation haircut for the various items. In that case, adjust the haircut and recalculate. But the basic idea is that RIM's balance sheet has mostly cash and receivables, and, importantly, stories of RIM's demise are premature. RIM is a no-brainer buy at the $11-13/share level: You get all its future earnings (if any) and intangibles (brand value, patent portfolio, network) for free. What's the value of this upside? That part is tough to quantify -- of course, much of the value depends on the successful launch of RIM's delayed products, a strategic buyer emerging, and so on. However, at the liquidation price, we don't need to know the future earnings with any precision -- I get any earnings for free, while my downside is capped. But for those who care about earnings value versus asset value, note that Goldman Sach's analyst -- historical bears on Research in Motion -- estimates the sum-of-parts value for Research in motion at $18/share. Now, of course, if management engages in "bet the company" behavior, the per-share value above will be considerably lower. I see no signs that management intends to engage is, one, very expensive and, two, hard to predict R&D projects to turnaround the firm. Further, No analysts currently expect Research in Motion to have an operating loss in the upcoming years, an important assumption in my thesis. One final note -- it's window dressing season, so institutions are unlikely to purchase volatile names two weeks before bonus time. The near-term lack of buyers -- and plentiful

presence of motivated sellers -- could present a potential opportunity to purchase an attractive asset play at a good discount to its intrinsic worth.

Open letter to BlackBerry bosses: Senior RIM exec tells all as company crumbles around him
By: Jonathan S. Geller | Jun 30th, 2011 at 10:45AM Theres no question Research In Motion is in the midst of a major transitional period. The company is planning to launch a brand new product line based on a brand new operating system within the next 12 months, and even though the first device born out of RIMs new QNX OS was impressive in some ways, it was incomplete. There still is a chance for RIM to deliver some really interesting competitive products, but time is quickly running out, as we have written time and time again. The thing is, RIM has always been a company controlled by two people Jim Balsillie and Mike Lazaridis. For all the things that have worked, they have missed the boat countless times and were now seeing the results. We have received an open letter to Mike and Jim from a high-level RIM employee (whose identity we have verified), and in an amazingly honest and passionate plea, this letter gives fascinating insights into what RIM must fix, and fast. RIM did not immediately respond to a request for comment. Read the open letter in its entirety after the break. P.S. If youre an employee of RIM and want to send us your thoughts and feelings on the company, you can send them to us via email or leave a comment below. UPDATE: Following this post, RIM issued an official response to the letter below. The companys full response can be viewed here. UPDATE 2: BGR has exclusively published two additional letters from RIM employees. They can both be viewed here. To the RIM Senior Management Team: I have lost confidence.

While I hide it at work, my passion has been sapped. I know I am not alone the sentiment is widespread and it includes people within your own teams. Mike and Jim, please take the time to really absorb and digest the content of this letter because it reflects the feeling across a huge percentage of your employee base. You have many smart employees, many that have great ideas for the future, but unfortunately the culture at RIM does not allow us to speak openly without having to worry about the careerlimiting effects. Before I get into the meat of the matter, I will say I am not part of a large group of bitter employees wishing to embarrass us. Rather, I believe these points need to be heard and I desperately want RIM to regain its position as a successful industry leader. Our carriers, distributors, alliance partners, enterprise customers, and our loyal end users all want the same thing for BlackBerry to once again be leading the pack. We are in the middle of major transition and things have never been more chaotic. Almost every project is falling further and further behind schedule at a time when we absolutely must deliver great, solid products on time. We urge you to make bold decisions about our organisational structure, about our culture and most importantly our products. While we anxiously wait to see the details of the streamlining plan, here are some suggestions: 1) Focus on the End User experience Lets obsess about what is best for the end user. We often make product decisions based on strategic alignment, partner requests or even legal advice the end user doesnt care. We simply have to admit that Apple is nailing this and it is one of the reasons they have people lining up overnight at stores around the world, and products sold out for months. These people arent hypnotized zombies, they simply love beautifully designed products that are user centric and work how they are supposed to work. Android has a major weakness it will always lack the simplicity and elegance that comes with end-to-end device software, middleware and hardware control. We really have a great opportunity to build something new and uniquely BlackBerry with the QNX platform. Lets start an internal innovation revival with teams focused on what users will love instead of chasing feature parity and feature differentiation for no good reason (Adobe Flash being a major example). When was the last time we pushed out a significant new experience or feature that wasnt already on other platforms? Rather than constantly mocking iPhone and Android, we should encourage key decision makers across the board to use these products as their primary device for a week or so at a time yes, on Exchange! This way we can understand why our users are switching and get inspiration as to how we can build our next-gen products even better! Its incomprehensible that our top software engineers and executives arent using or deeply familiar with our competitors products.

2) Recruit Senior SW Leaders & enable decision-making Im going to say what everyone is thinking We need some heavy hitters at RIM when it comes to software management. Teams still arent talking together properly, no one is making or can make critical decisions, all the while everyone is working crazy hours and still far behind. We are demotivated. Just look at who our major competitors are: Apple, Google & Microsoft. These are three of the biggest and most talented software companies on the planet. Then take a look at our software leadership teams in terms of what they have delivered and their past experience prior to RIM It says everything. 3) Cut projects to the bone. There is a serious need to consolidate our focus to just a handful of projects. Period. We need to be disciplined here. We cant afford any more initiatives based on carrier requests to squeeze out slightly more volume. Again, back to point #1, focus on the end users. They are the ones making both consumer & enterprise purchase decisions. Strategy is often in the things you decide not to do. On that note, we simply must stop shipping incomplete products that arent ready for the end user. It is hurting our brand tremendously. It takes guts to not allow a product to launch that may be 90% ready with a quarter end in sight, but it will pay off in the long term. Look at Apple in 1997 for tips here. I really want you to watch this video because it has never been more relevant. It is our friend Steve Jobs in 97 and it may as well be you speaking to RIM employees and partners today. https://www.youtube.com/watch? v=3LEXae1j6EY 4) Developers, not Carriers can now make or break us We urgently need to invest like we never have before in becoming developer friendly. The return will be worth every cent. There is no polite way to say this, but its true BlackBerry smartphone apps suck. Even PlayBook, with all its glorious power, looks like a Fisher Price toy with its Adobe AIR/Flash apps. Developing for BlackBerry is painful, and despite what youve been told, things havent really changed that much since Jamie Murais letter. Our SDK / development platform is like a rundown 1990s Ford Explorer. Then theres Apple, which has a shiny new BMW M3 just such a pleasure to drive. Developers want and need quality tools. If we create great tools, we will see great work. Offer shit tools and we shouldnt be surprised when we see shit apps. The truth is, no one in RIM dares to tell management how bad our tools still are. Even our closest dev partners do their best to say it politely, but they will never bite the hand that

feeds them. The solution? Recruit serious talent, buy SDK/API specialist companies, throw a truckload of money at it Lets do whatever it takes, and quickly! 5) Need for serious marketing punch to create end user desire 25 million iPad users dont care that it doesnt have Flash or true multitasking, so why make that a focus in our campaigns? Ill answer that for you: its because thats all that differentiates our products and its lazy marketing. Ive never seen someone buy product B because it has something product A doesnt have. People buy product B because they want and lust after product B. Also an important note regarding our marketing: a products technical superiority does not equal desire, and therefore sales How many Linux laptops are getting sold? How did Betamax go? My mother wants an iPad and iPhone because it is simple and appeals to her. Powerful multitasking doesnt. BlackBerry Messenger has been our standout, yet we wasted our marketing on strange stories from a barber shop to a horse wrangler. I promise you, this did nothing to help us in the mind of the average consumer. We need an inventive and engaging campaign that focuses on what we are about. People buy into a brand / product not just because of features, but because of what it stands for and what it delivers to them. People dont buy what you do, people buy why you do it. Take 3 minutes to watch the this video starting from the 2min mark: http://youtu.be/qp0HIF3SfI4 6) No Accountability Canadians are too nice RIM has a lot of people who underperform but still stay in their roles. No one is accountable. Where is the guy responsible for the 9530 software? Still with us, still running some important software initiative. We will never achieve excellence with this culture. Just because someone may have been a loyal RIM employee for 7 years, it doesnt mean they are the best Manager / Director / VP for that role. Its time to change the culture to deliver or move on and get out. We have far too many people in critical roles that fit this description. I can hear the cheers of my fellow employees now. 7) The press and analysts are pissing you off. Dont snap. Now is the time for humility with a dash of paranoia. The publics questions about dual-CEOs are warranted. The partnership is not broken, but on the ground level, it is not efficient. Maybe we need our Eric Schmidt reign period. Yes, four years ago we beat Microsoft when everyone said Windows Mobile with Direct Push in Exchange would kill us. It didnt in fact we grew stronger.

However, overconfidence clouds good decision-making. We missed not boldly reacting to the threat of iPhone when we saw it in January over four years ago. We laughed and said they are trying to put a computer on a phone, that it wont work. We should have made the QNX-like transition then. We are now 3-4 years too late. That is the painful truth it was a major strategic oversight and we know who is responsible. Jim, in referring to our current transition recently said: No other technology company other than Apple has successfully transitioned their platform. Its almost never done, and its way harder than you realize. This transition is where tech companies go to die. To avoid this death, perhaps it is time to seriously consider a new, fresh thinking, experienced CEO. There is no shame in no longer being a CEO. Mike, you could focus on innovation. Jim, you could focus on our carriers/customers They are our lifeblood. 8) Democratise. Engage and interact with your employees please! Reach out to all employees asking them on how we can make RIM better. Encourage input from ground-level teamswithout repercussionsto seek out honest feedback and really absorb it. Lastly, were all reading the news and many are extremely nervous, especially when we see people get fired. We need an injection of confidence: share your strategy and ask us for support. The headhunters have already started circling and we are at risk of losing our best people. Now would be a great time to internally re-brand and re-energize the workplace. For example, rename the company to just BlackBerry to signify our new focus on one QNX product line. We should also address issues surrounding making RIM an enjoyable workplace. Some of our offices feel like Soviet-era government workplaces. The timing is perfect to seriously evaluate at our position and make these major changes. We can do it! Sincerely, A RIM Employee