During its recent quarterly report, RIM shared a good deal of information, and not all of it clear. The BlackBerry maker isn't getting out of the consumer space. It's just scaling back.
maker Research In Motion held an information-packed earnings call
March 29 that
left many unclear about its intentions, especially when it comes to the split
between the consumer market and its traditional place in the enterprise.
RIM was an
early leader in the mobile email space, widely dubbed the enterprise gold
standard, but as the Apple iPhone and Android-running smartphones gained
popularity among consumers, and eventually began encroaching on RIM's
enterprise territory, the Canadian company followed the example and likewise
tried to have a hand in each market.
Thorsten Heins, RIM's 10-weeks-on-the-job CEO, was a contributor to its current
RIM needs to
focus, Heins said, on its longtime area of expertisethe enterpriseand narrow
its consumer interests to select areas, which it hopes to do with help from
believe that BlackBerry cannot succeed if we try to be everybody's darling and
all things to all people," Heins said on the call, according to a
transcript from SeekingAlpha
Therefore, we plan to build on our strengths, to go after targeted consumer
segments, and we will seek strong partnerships to deliver those consumer
features and content that are not central to the BlackBerry [value] position,
for example, media consumption applications."
consumer area where RIM needs to backpedal, said Heins, is its
"consumer-oriented, value-added services business," which it has
built up over the last two and a half years through a number of acquisitions.
Evaluating these during the last 10 weeks, Heins said, it was clear that, given
RIM's current market position, it would be "extremely difficult" for
RIM to see much success from continuing to develop and invest in this
result, we will be looking at ways to scale back these activities and refocus
resources on developing an integrated services offering that leverages RIM's
strengths, such as BBM, security and manageability," added Heins.
"The intent would be for these services to add value to our customers and
generate service revenue for the company."
that RIM was slow to detect the now widely popular bring-your-own-device (BYOD)
trend within enterprises, and RIM's remedying of this speaks to one consumer
area that it will
continue to focus
on: very high-end devices.
Heins said he
wants to make BlackBerry handsets an "aspirational, high-end object of
desire, with the best functionality for communication purposes and for people
who just need to stay ahead of the game that need productivity and that need to
is lower-end smartphones. The number of Americans with smartphones is rising.
According to February data from the Pew Internet & American Life Project
percent of American adults now own smartphones, up from 35 percent a year ago.
While 25- to 34-year-olds are the largest demographic of smartphone users, 18-
to 24-year olds are the group most quickly transitioning from feature phones to
don't move from a feature phone to a full-blown smartphone with all bells and
whistles that you can think about," Heins said during the call.
"There is a learning point that we've successfully covered with the 8520
Curve, and it's still selling really, really well."
devices could also help RIM in international markets, where it enjoyed considerable success for years
but lately is again finding Apple and Android invading, and the latter proving a
tough competitor on the pricing front. Nokia, too, is focused on bringing
inexpensive but savvy handsets to developing markets.
simple messages I want you to understand and take home is that we're making the
necessary changes at the company," Heins said during his prepared remarks.
He went on to explain that these include, one, realigning the business to build
on its strengths; two, successfully launching the first BlackBerry 10
smartphone later this year; three, reshaping the organization for better
accountability and efficiency; and four, evaluating a variety of options to
increase shareholder value.
open to a variety of different avenues to [drive] long-term volume value in the
company," Heins continued, "and we intend to be as transparent as we
can in communicating our progress with you. I look forward to providing you
with an update in the near future."