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Should RIM stop making BlackBerrys?
Top investors are calling for heads after closing the year with embarrassing setbacks
It might be time for smartphone manufacturer RIM to ditch the BlackBerry to save face, argues one prominent shareholder.
It might be time for smartphone manufacturer RIM to ditch the BlackBerry to save face, argues one prominent shareholder.
CC BY: miggslives
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t's been an embarrassing year for RIM. Poor BlackBerry sales, disappointing financial results, and the lowest share prices in almost eight years are just a few of the setbacks the Canada-based smartphone manufacturer has suffered. Now the company reportedly will be forced to delay the newest generation of BlackBerry 10 handsets thanks to a hardware setback, and frustrated investors are openly calling for a drastic makeover. With Apple and Google tearing away market share, should RIM consider give up on phones altogether?

Yes. It's the only way to save face: The "road map to value restoration," activist shareholder Jaguar Financial tells Reuters, "lies in a sale of RIM whether as a whole or in separate parts." The company can't compete in the hardware business, and its PlayBook tablet is a big disappointment. RIM's best bet is to give up on BlackBerry, squeeze some cash out of its patent portfolio — say, by selling its encrypted email technology to other platforms like Android — and maintain its high-margin services business.
"Could RIM's survival mean abandoning the BlackBerry?"

No. But they definitely need fewer products: Quick, says Carmine Gallo at Forbes, "tell me the difference between the BlackBerry Torch 9850, 9860, 9800, and 9810." You can't. Even analysts who follow RIM for a living "can't keep these models straight." Steve Jobs faced the same problem when he returned to Apple in 1997, and he had the "courage" to slash his stable of products from 350 to 10. If RIM cuts the "clutter" too, it can get back on top.
"RIM needs courage to escape clutter and confusion"

What it needs is better BlackBerrys: RIM's big plan is to replace its marketing guys and launch a new promotional campaign, says Jay Yarow at Business Insider. Are you kidding? HTC and Samsung barely do any advertising, and look how well they're doing. BlackBerry users aren't bailing because RIM's advertising is "awful" advertising, but because its "products suck." They might return for better phones, but not for better ads.
"RIM's absurd plan to fix itself: Do better advertising In 2012"

 

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