RIM Is a Poor Buyout Target: 10 Reasons Why

 
 
By Don Reisinger  |  Posted 2013-01-29 Email Print this article Print
 
 
 
 
 
 
 

NEWS ANALYSIS: Whether it's Lenovo, Samsung or Microsoft, there's not a single company in the technology industry that would be wise to acquire RIM.

It seems that every month, there's a rumor circulating suggesting that another technology company will buy out Research In Motion.

The latest claim focuses on Lenovo, which is said to be at least keeping an open line of communication with RIM, and is always considering merger-and-acquisition targets. Both Lenovo and RIM have tried to toss some ice water on the rumor, but it illustrates an important point: RIM is, at the very least, a buyout target.

However, when it came down to a decision of actually buying out RIM, it was clear the company has too many problems and faces too many challenges to be worth the potential cost. In fact, over the last couple of years, reports have suggested that Microsoft, Samsung and even IBM have at least considered the idea of acquiring RIM.

In each case, those companies slowly backed away after concluding that it wouldn't be a smart or profitable acquisition. What those companies realized was that although the company's assets and technology are attractive, RIM is carrying a lot of baggage that makes it an awful buyout target. And now, more than ever, would be a bad time to buy up the BlackBerry maker.

Read on to find out why.

1. BlackBerry's decline

RIM's BlackBerry market share is plummeting in both developed and developing countries around the world. Things are so bad, in fact, that recent reports have suggested Android and iOS combined now own 92 percent of the entire mobile operating system market. What company would want to acquire a vendor that's fighting for only 8 percent of that space?

2. There's no indication BlackBerry 10 will work

There's little debating that BlackBerry 10 will be a major step up over the operating system currently running on BlackBerry devices. However, BlackBerry 10 will not be the platform to actually take down Apple and Google and restore RIM's fortunes. The company's troubles are simply too widespread and too major for a simple operating system launch to fix.

3. The corporate culture is all wrong

RIM has been operating under a corporate culture for years that values the old, obsolete values of the early 2000s over the forward-thinking ideas that govern the mobile space today. And unfortunately, RIM's employees have signed on to those tired ideas. A company looking to transform RIM will not want to acquire it for that reason alone.

4. Only Apple can pull off the business model

There is not a single company other than Apple that has been able to combine software and hardware to achieve great success since the start of the smartphone era. Granted, RIM did that years ago in the days of feature phones, but that was before the iPhone joined the market. It would take a truly phenomenal new product to take down Apple and the iPhone. BlackBerry 10 isn't that product, nor is any such product on the horizon.



 
 
 
 
 
 
 
 
 
 
 
 
 

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