Investors criticize RIM's board of directors, but executives said that despite recent setbacks, they’re still confident about the company's future.
Executives with BlackBerry maker Research In
Motion faced a skeptical audience at the companys annual shareholders meeting
July 10, two weeks after CEO Thorsten Heins announced another delay in the
release of the
BlackBerry
10 platform, a $518 million quarterly operating loss and 5,000 job cuts.
In speaking to investors, Heins again
extolled the virtues of the BlackBerry 10 platformwith the first devices now
scheduled for release in the first quarter of 2013and the strategy under way
at RIM to streamline the companys operations, including cutting $1 billion in
expenses by the end of the fiscal year and looking for other ways to leverage
RIMs assets, such as joint ventures with other companies and licensing
BlackBerry technology to third parties.
It was similar to a message that Heins
delivered June 28, when he announced the fiscal first-quarter results, the
latest in a growing string of bad news for a company that has seen its position
in the smartphone market wane significantly in the face of competition from
Apples iPhones and the host of devices running on Googles Android operating
system. Sales of BlackBerry phones fell 41 percent in the last quarter, and
RIMs share of the U.S. market has fallen to 4 percent.
I am not satisfied with the performance of
the company over the past year, said Heins, who was appointed president and
CEO in January, replacing longtime
co-CEOs
Mike Lazaridis and Jim Balsillie. He noted the major changes that already
have been made at the company, and promised there will be more to come.
Shareholders quickly showed their displeasure
with RIMs performance, and took aim primarily at the board of directors. At
the start of the meeting, investors elected 10 people to the board, including
Heins and Lazaridis, who both were re-elected. However, investors withheld more
than 19 percent of votes for Lazaridis, and almost 15 percent for Heins.
Investors also questioned the makeup of the
board, with one asking Chairperson Barbara Stymiest whether the board planned
to aggressively pursue new board members with strong technology experience, and
another questioning why the board was made up of executives from North
Americaand particularly Canadawhen the company is losing share in the region
and its strengths are in other parts of the world.
Stymiest stressed that RIM was pleased with
the makeup of the board, including the technological and global experience of
its members. Those answers didnt satisfy all shareholders. One investor said
he was extremely critical and extremely angry with the board, and that all
the longtime members should not have been re-elected.
Why did they just let it get out of hand so
badly and so much before they did anything about it? he asked.
Yet another investor took issue with Heins
himself, and his pay package, noting that until coming to RIM, he had never
been a CEO anywhere else. Heins noted that before coming to RIM in 2007, he
oversaw several business units at Siemens Communications Group, including
several that had more than $1 billion in business and one that was a turnaround
job.
Despite the sharp criticism from investors,
Heins and Stymiest reiterated their belief in the strategy now in place, in the
new executives Heins has brought on board and on what BlackBerry 10 will do for
the company once the devices hit the market. Heins said RIM had been hurt not
only by the competition from Apple and Android device makers, but also by such
trends as the bring-your-own-device (BYOD) phenomenon, with employees bringing
iPhones and Android smartphones into the enterprise environment that RIM at one
time had dominated.
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