RIM denies it will leave consumers behind

RIM denies it will leave consumers behind

Research in Motion (RIM) has moved to deny it is exiting the consumer market after it was suggested the manufacturer was planning to focus on its enterprise business.

The BlackBerry manufacturer posted its full year results overnight, with net income more than halving to $1.16bn. Sales were down 7.4% to $18.44bn. It had a poor fourth quarter, making a loss of $125m on sales of $4.19bn, down 18.9% on its 2011 financial year.

Early reports of the results quoted RIM CEO Thorsten Heins, who implied the business would abandon its consumer business. He told analysts in a conference call: 'We plan to refocus on the enterprise business and capitalise on our leading position in this segment.

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

However, RIM issued a statement this morning that denied this was the case. Patrick Spence, SVP and MD for global sales and regional marketing said: 'The claim that RIM has said it will withdraw from the consumer market is wholly misleading. Whilst we announced plans to refocus our efforts on our core strengths, and on our enterprise customer base, we were very explicit that we will continue to build on our strengths to go after targeted consumer segments. We listed BBM, as well as the security and manageability of our platform, amongst our strengths.'

A RIM spokesperson said it plans to 'aggressively' target upgrading customers to choose its BlackBerry 7 smartphones. Further BlackBerry 7 devices are planned to be released during the next few months, which the manufacturer is targeting at the entry-level market.

CCS Insight MD Shaun Collins said Heins' candid assessment of the state of RIM, where he raised the possibility of licensing its platform as well as a potential sale, was one of the few positives from the results. He said: 'CCS Insight believes RIM has little practical choice but to deliver a compelling consumer proposition with BlackBerry 10 given the segment's overwhelming contribution to revenue and the need to ensure BlackBerry benefits from the same [bring your own] trend that is driving iOS penetration in enterprise.'

IHS Global Insight telecom analyst Dexter Thillien said: 'It looks as though RIM is trying to position itself to completely change its strategy going forward, with software as the main focus, but the success (or failure) of BlackBerry 10 devices will decide under which context future partnerships and licensing deals will occur.'

Victor Basta, director of mergers and acquisitions advisory firm Magister Advisors said: 'Under its  new leadership, RIM is focused on operational improvements but the real issue is fundamentally strategic: why should RIM exist when all other smartphone makers are developing better products faster? RIM spends billions on R&D, but they consistently deliver me-too products and are outpaced in a market that demands innovation.'

Editor: Graeme Neill

Written by Mobile Today
Mobile Today


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