Microsoft is reportedly interested in purchasing BlackBerry maker Research In Motion, but such an acquisition could have negative consequences for Microsoft, an analyst says. Both Microsoft and RIM saw their share of the mobile market decline incrementally between September and December 2009. Microsoft is preparing for a major mobile-related announcement on Feb. 15, which many expect will be the debut of either the Windows Mobile 7 operating system or else a revamped Mobile 6.5.
Microsoft CEO Steve Ballmer may be
interested in purchasing BlackBerry maker Research In Motion, according to
online reports, but substantial roadblocks may exist to such a deal.
According to a
Feb. 8 post on the All Things Digital blog,
Ballmer has "expressed
interest in buying RIM many times (while also dismissing any interest in
Palm)." That bit of information apparently came from unnamed sources within
Microsoft, and the post has led to online surmising by others that Microsoft's
planned Feb. 15 news conference at the Mobile World Congress in Barcelona,
Spain, could be a RIM
However, at least one analyst sees a substantial negative side to a
"While there is often speculation about MSFT's
interest in purchasing RIMM, we think the
likelihood is slim and that MSFT's near-term
focus is on gathering support for its upcoming release of the Windows 7 mobile
platform," Mark McKechnie, an analyst with Broadpoint AmTech, wrote in a
Feb. 11 research note.
Arguments for a possible acquisition, in McKechnie's opinion, include RIM's
"dominant position in the enterprise, which MSFT
could [make use of] to [improve] its Exchange business and add up to [about] $5
billion in recurring revenue should it reach 100 million subscribers."
Such an acquisition would strengthen Microsoft's ability to compete for mobile
customers against Google and Apple.
However, McKechnie added, "We think RIMM
would try and block a deal and that an acquisition would likely have to be
hostile for it to occur." In addition, "RIMM's
OS could be difficult to port over to a full Windows environment, thus proving
a weaker 'end game' for Microsoft." A deal with RIM could also eclipse any
previous Microsoft acquisition in terms of cost, which could prove prohibitive.
RIM and Microsoft saw their market share in the mobile arena decline
point between September and December 2009, according to statistics watcher
ComScore, leaving RIM with a 41.6 percent share and Microsoft with 18 percent.
Meanwhile, both Google and Apple enjoyed incremental gains.
For weeks, the news has been out that Microsoft plans a major
smartphone-related rollout at the Mobile World Congress. The general consensus
seems to be that the company will debut either the next version of its mobile
operating system, Mobile 7, or else
a radically revamped version of Mobile 6.5, with was
released in October 2009.
The Mobile 6.5 update faced
fierce competition from Google, Apple and RIM. Part of Microsoft's strategy
involved Windows Marketplace for Mobile,
a competitor to Apple's App Store where third-party developers could post
mobile applications for Windows phones. Windows Marketplace launched in October
with 246 applications in its online storefront, a number that has since
increased to 718 for U.S.-based Mobile 6.x smartphones;
by contrast, Apple's App Store expanded to more than 100,000 apps in 2009.
Meanwhile, RIM has been attempting to hold on to its share of the enterprise
and consumer markets by introducing devices such as the BlackBerry
a sleeker version of the BlackBerry Bold 9000. The company has
also been touting BlackBerry OS 5.0, which it says offers a faster browser
experience and improved typing accuracy and selection.