March 30, 2012

Troubled RIM Exiting Consumer Market

Canada-based RIM, maker of the once popular BlackBerry devices, said on Thursday it plans to refocus its attentions to corporate customers, rather than the consumer market.

This news, as well as poor sales reports and a bit of a management shakeup was announced during an earnings call.

In an effort to refocus on the companies strengths, RIM said they hope to build devices employees will want to bring into the corporate environment and create partnerships with other businesses to produce the consumer offerings RIM doesn´t deem as being in their central focus.

In the earnings call, new RIM CEO Thorsten Heins said, “We can´t do everything ourselves, but we can do what we´re good at.”

Long successful in the corporate world, RIM began to lose sight of their central focus when it entered the consumer market. As Apple´s iPhone and Google´s Android based systems became more popular in the consumer market, RIM´s BlackBerry lacked the mass appeal to attract loyal fans. Now, Heins is calling for a turnaround requiring “substantial change”.

“We believe that BlackBerry cannot succeed if we tried to be everybody´s darling and all things to all people,” Heins said. “Therefore, we plan to build on our strength.”

Heins became CEO of the struggling company only a few months ago as co-CEOs Jim Balsillie and Mike Lazaridis stepped down on the news of RIM losing tens of billions of dollars in market value.

In addition to poor numbers, RIM also announced the resignation of Balsillie from the board. Balsillie had been with RIM for 20 years. Balsillie wasn´t alone in jumping ship; David Yach, chief technology officer and Jim Rowan, chief operating officer for global operations are also leaving the company.

While RIM goes through a comprehensive strategic review, Heins said he was open to selling the company, but it wasn´t their main focus.

So where did RIM lose its way? The BlackBerry was once synonymous with business and corporate culture, as all high-end executives proudly implemented the device as part of their daily lives. The BlackBerry excelled at e-mail communications, had a tough as nails security system, and worked reliably. Famously, Barak Obama carried a BlackBerry and refused to part with it when he was elected into office.

As bad news has been hitting the Canadian smartphone maker rather strongly the past few years, much has been said about where the BlackBerry maker went wrong.

Many people blame RIM´s entrance into the consumer market. As their phones have failed to compete at the same level as their Apple and Android counterparts, sales of the BlackBerry have been on a slow decline for years. As the iPhone and Android based systems moved into RIM´s corporate territory, BlackBerry´s market share began to decline and RIM has since been unable to successfully recover this lost part of their heritage.

One improvement RIM hopes to make in the future lies in their new operating system, BlackBerry 10. However, bad news has already come to light about this new development, as RIM announced earlier this year delays will keep new phones running BlackBerry 10 will be delayed until later this year.


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