RIM hiring financial adviser to consider licensing, investment options
Struggling Canadian smartphone maker Research in Motion is said to be in talks with a financial adviser to assist it in weighing strategic options in an effort to turn around its plummeting business.
RIM is expected to decide whether to work with a band in the next few days, Bloomberg reported on Tuesday, citing four people familiar with the matter. They indicated that RIM would prefer an agreement to license its smartphone software, while its secondary choice would be a strategic outside investment in the company.
With those options allegedly strong possibilities for the company, one drastic option that is reportedly not on the table is a sale of the company. One source was said to have indicated that executives at RIM have no plans to sell.
RIM is said to be considering hiring one Canadian bank and one global bank to help it come to a decision.
If RIM decides to license its patents, which are considered to be the company's most valuable assets, both Microsoft and Samsung would be interested in such a deal, Tuesday's report claimed. Microsoft, however, would be unlikely to make a strategic investment in RIM, the report said.
While those options are available, executives at RIM would rather find a way to license its forthcoming BlackBerry 10 operating system, which is scheduled to launch later this year. As such, officials at RIM are focused on finding a bank that can best advise them on forging a licensing deal for BlackBerry 10.
Shares of RIM have slid 75 percent over the last year as the company has failed to adequately respond to the success of Apple's iPhone and handsets running the Google Android mobile operating system. The company reported dismal earnings late last month as three major executives, including co-founder Jim Balsillie, left the company, after reporting quarterly results so poor that the RIM had to publicly clarify it did not plan to pull out of the consumer sector.
Earlier this month, RIM lost two more top executives, and the company revealed it was weighing its strategic options. Future changes for the company could include a shift from hardware to software and services.
RIM is now even being outperformed in its home country of Canada, as for the first time ever Apple's iPhone surpassed the BlackBerry in 2011. RIM shipped 2.08 million BlackBerrys last year in Canada, while Apple shipped 2.85 million iPhones.
[ View article on AppleInsider ]
Comments
The beginning of the end ...
the problem with blackberry is the fact that they are stuck in Quick sand... and anymove makes them sink further... so even a "lifeguard" (new CEO) throws a "life preserver" into the quick sand, it will also sink too... thus the "new CEO" needs to get a crane and pull "blackberry" out of the quicksand... (perhaps QNX is that crane...)
but will the crane be on solid ground?, or will it too be engulfed in the mire?...
so stop with the license BS... make the BLACKBERRY run 4 times longer, and i assume that their existing customers will be happy and they will be a slimmer happier company... otherwise slash and burn so that RIM can run on half the subscriber base that it has now...
Financial Adviser: "Stick your head between your legs and kiss your a$$ goodbye. That'll be $1,000,000."
RIM continues to slide into irrelevance. There is no saving RIM. Horrible phones, horrible OS, and horrible management.
The key now becomes saving the good patents, working ideas, and people they have left in there.
For Apple, securing rights to the tech and patents behind BBM, at least, looks like it should be key.
Because then all the business users left in the lurch by the death of their company can just pop on over to Apple and use iMessage.
Remaining questions:
a) how long are they going to drag this out?
b) who's going to make the "Big Decision" and pull the plug? The banks, board, or Hein? "D"-all of the above?
c) by not being decisive re: "The Big Decision", are they actually gaining anything? Anything at all?
The writing was on the wall last year already. I think they needed to do something then, because they at least had the shadow of a doubt what was coming out of Redmond... yes Microsoft. Because it is MS that is the gorilla in the enterprise room, and that's the only place I see left for RIM's products. Consumer market is all tied up, and even MS knows it's gonna be long, long ride towards carving a piece of that pie. They can "wait" it out though, while RIM can only "wade" before slowly sinking into the vortex.
It?s sad to see RIM as an entity fall, but they still have a LOT of valuable assets that can continue providing great value to people for years to come. Off the top of my head, they must have about 17,000 office chairs and desks, along with various computers, pens and office supplies, and bathroom supplies. They probably also own some of their own buildings, along with parking and high-end decorative shrubs and grasses.
Ha - that's an awesome way to think about it. Heck, think of the savings in energy if they start shuttering offices - all the light bulbs, computers, heat. And there has to be miles of copper wire just waiting for some recycler to get their hands on.
They already worked with U2, who is bigger than them? I think bands might not be the way to go. Though that One Direction seem to be popular with the BBM tweens...
More thoughtfully put, they need to pull a Steve Jobs and focus. That means eliminating products, cutting size, and bringing the scope of both the company and it's product design efforts in-line with what is manageable given its sales and trajectory. Then they need to focus what remains intensely on doing something substantively new and better than before.
People think this is a done deal, but it is not a foregone conclusion that they have to go down. Everyone thought Apple was done in the 90's - look at them now. MS is weak - they are a prime candidate to get picked off by RIM should any actual vision develop within the company.
The problem with RIM has been that the company's management has not effectively perceived, appreciated, or responded to change; they have been rigid and risk averse. As a result they tried to fight a new kind of battle with the same strategies and methods from the old war, and it isn't working for them. They need, right now, a bet the company move - a hail Mary pass. They are losing the company anyway, so fundamentally there is really no difference in the long term; they can fail through inaction, or take a chance and fail through a bold and decisive action that was miscalculated. Or, they can make that bold step and win. Taking the step, though, is the only direction that doesn't absolutely end with dissolution.
Unfortunately, what we see from them is some attempt to find a way of salvaging the greatest value for the shareholders in the event of the company's failure, not an attempt to innovate to success. They are behaving like a dying wildebeest trying to spell out to the vultures which parts are the best to nibble at... in order to stave off the end a little longer. Sad.
oh oh ...
The beginning of the end ...
Beginning?
I think we're beyond that.
The key now becomes saving the good patents, working ideas, and people they have left in there.
For Apple, securing rights to the tech and patents behind BBM, at least, looks like it should be key.
Because then all the business users left in the lurch by the death of their company can just pop on over to Apple and use iMessage.
If all that's left are "assets" then their business (of engaging customers in a sales relationship) is winding down.
I seriously thought (and posted here I might add) that RIM would already be gone or have made the announcement that the were selling.
Remaining questions:
a) how long are they going to drag this out?
b) who's going to make the "Big Decision" and pull the plug? The banks, board, or Hein? "D"-all of the above?
c) by not being decisive re: "The Big Decision", are they actually gaining anything? Anything at all?
.
Among many, there seems to be a belief that RIM is on the verge of bankruptcy and liquidation. This is not the case. They still have a few billion dollars in cash, plus other longer-term assets and are still growing in some markets. Even if they continue to screw things up, they can keep going for years. It is very rare for companies to 'pull the plug' while they still have big revenue streams and lots of cash on hand.
This is not to say that they don't have huge problems, but they still have years left as a going concern.
Apple did that when they almost went under. They came out with the simple (or what some thought) iPod. That is what really saved them, and got them back on track.
I believe Rimm started as a pager company. That, I believe is the direction they ought to take. Everybody seems to be in a hurry to be the smartest. Believe me, some people are not that smart and could use something a whole lot more simple. For sure it needs to be inexpensive.
If they could come up with a strong phone, with some texting but at a very cheap price ($25.00) they would not need to have to do the app thing at this moment so Data charges would be nill.
I think that will be the only way for them to be different.
(My 1 cents worth)