RIM CEO Heins: Is No Drastic Change the Right Move?

 
 
By Nicholas Kolakowski  |  Posted 2012-01-24 Email Print this article Print
 
 
 
 
 
 
 

RIM's new CEO, Thorsten Heins, seems determined to keep the company along its preset path. Some analysts are arguing he needs to do something more radical.

Research In Motion appointed a new CEO Jan. 22, replacing longtime co-CEOs Mike Lazaridis and Jim Balsillie with Thorsten Heins, the company's chief operating officer for product and sales.

Heins has quite a task in front of him. RIM's market share is steadily eroding in the face of aggressive competition by Apple's iOS and Google Android. Meanwhile, Microsoft is making a renewed play in the space with Windows Phone, bringing with it Nokia and other manufacturers.

In his new role, Heins seems determined to keep RIM on its preset track, with the ultimate goal of releasing the next-generation BlackBerry 10 operating system near the end of 2012. RIM is betting that a new line of devices running the QNX-based software will give it the buzz among consumers and businesses necessary to execute a decisive turnaround.

"Mike and Jim took a bold step 18 months ago when RIM purchased QNX to shepherd the transformation of the BlackBerry platform for the next decade," Heins wrote in a Jan. 22 statement. "We are more confident than ever that was the right path."

But is it? By the time BlackBerry 10 arrives on the market, RIM's major competitors will almost certainly have all released further updates to their respective operating systems. Some analysts believe that RIM's survival and prosperity hinge on revamping its overall strategy.

"RIM has been focused on the wrong assets for the past three years, competing in a consumer market against the most powerful brands in the world," Ted Schadler, an analyst with Forrester, wrote in a corporate blog posting Jan. 23. "It's not working." According to Forrester's May 2011 survey of some 5,000 information workers in the United States, RIM is responsible for some 42 percent of employee smartphones-down from 90 percent a few years before. Meanwhile, Apple and Android occupy some 48 percent of that same install base. 

Other analysts also feel that RIM's current course isn't necessarily the most optimal one. "We believe RIM's new CEO struck a positive tone on the conference call Monday to rally the troops," Peter Misek, an analyst with Jefferies & Co., wrote in a Jan. 24 research note. "However, we believe after conducting an in-depth study, he will conclude that a significant restructuring is necessary as the company will not be able to compete head on with Apple and Android."

Furthermore, he added, Heins' announcement that RIM will devote increased focus to marketing may not pay the dividends the company requires-at least, not at the moment: "RIM will hire a new chief marketing officer as soon as possible and increase its focus on marketing to U.S. consumers; however, we believe that any ramp in spending should be delayed until BB OS 10 phones arrive."

RIM certainly has little choice but to launch BlackBerry 10. But reviving the company's overall fortunes will likely necessitate a little more than business-as-usual from its executives.   

Follow Nicholas Kolakowski on Twitter 

 
 
 
 
 
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.
 
 
 
 
 
 
 

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