The IT Nerd

Now this is an interesting question that I got in my inbox today. How would I fix RIM. Seeing as they are on life support at the moment, I’m not 100% sure they can be fixed. But lets assume for a second that it is possible to fix RIM. Here’s what I would do to fix it:

1. The board has to go: RIM would not have gotten this bad if the board who oversaw ex-CEOs Jim Balsillie and Mike Lazaridis actually did their jobs as opposed to look the other way. There’s no reason to believe that this won’t continue seeing as largely the same board is still in place. Thus it needs to be swept away and complete outsiders need to come in and take over.
2. A CEO from the outside needs to be hired: Thorsten Heins hasn’t been CEO all that long, but he has been with RIM since 2007 according to RIM.com. He spent the first few months of his tenure as CEO basically saying that there was nothing wrong. Now he’s laying off 5000 people and the company has lost $518 million. But according to him, it’s not as bad as it looks although he’s not happy with the performance of RIM. Sorry, he’s as much a part of the problem with RIM as the board is. Thus the solution is similar. A complete outsider needs to come in and run the company.
3. Blackberry 10 must ship early in 2013: By early in 2013, I mean January 1, 2013. This new platform which is the only thing that will save RIM is going to be late to market having been delayed at least twice. By then, there will likely be a new iPhone and a new version of Android on the streets and in the hands of consumers. It cannot afford a third delay under any circumstances if they want to get back into the game.
4. Blackberry 10 must be outstanding: It will not be good for RIM if Blackberry 10 gets a bunch of ho hum reviews. Blackberry 10 has to hit the ground bug free, and it has to be something that shifts the smartphone market back to RIM. Anything less, and they’re screwed.
5. RIM needs a plan “b”: What happens if Blackberry 10 arrives dead on arrival? What’s their plan “b”? I have no idea. RIM needs one and they need one now.

Agree? Disagree? Did I miss anything? Post a comment and share your thoughts.

I’ve been saying this a lot, but today was a bad day for RIM. Their board of directors met their shareholders and things did not go well for the company according to The Globe And Mail:

But some of the investors present were not as committed to the board. During a somewhat confrontational question and answer session, one investor asked why members of RIM’s board had let the company’s continuing problems fester for so long, and argued that none of the old members of the board should stay on.

“What this company needs is an upheaval,” like the one that took place at CP Rail, he said, drawing applause from some of the 300 or so people at the meeting.

Even before investors had a chance to vent, a proxy shareholder asked several tough questions about the composition of the board.

Vic Alboini, of Jaguar Financial, first asked whether the board was searching for additional technology talent to augment the board – to which Ms. Stymiest said they were searching, and had enlisted a firm for such a task. Then Mr. Alboini asked for the number of votes withheld on the re-election of directors; many, when the list was read out, had percentages of votes withheld above 20 per cent, with director John Richardson having more than 30 per cent of  votes withheld. “Clearly this is not an overwhelming approval,” Mr. Alboini said.

Well. This is not going to win any supporters anytime soon. Clearly investors want change and want that change to happen sooner or later. That’s not going to help their stock value and their public perception.

Oh, by the way it’s get worse for RIM:

As part of its strategic review, RIM has also made changes to its senior management team, including the hiring of new chief marketing, operating and legal officers. Still, Mr. [RIM CEO Thorsten] Heins once again predicted the company will lose money in its second quarter, and that the turnaround will take more time to implement.

Hmmm…. They’re going to lose money in their second quarter? And there’s no new product until sometime next year? That’s a recipe for failure. No wonder investors are ticked off.

I woke up as I usually do to CBC Metro Morning and was shocked to hear RIM CEO Thorsten Heins on the show claiming the company was not in a death spiral. If you want to hear the interview, click here. Usually RIM doesn’t give interviews to a morning show in Toronto. So that was weird. Then I checked on the Toronto Star and the Globe and Mail later in the day. According to both papers, they’ve on a full court PR press to change their public perception. They even claim that they’re going to “empower Canadians like never before” according to a letter that he wrote for the Globe And Mail:

Technology, and particularly mobile computing, is a globally dynamic industry where innovation is as likely to occur in Waterloo as it is in Seoul or Palo Alto or Stockholm.

Rather, we believe RIM is a company at the beginning of a transition that we expect will once again change the way people communicate. In technology, it is not if you have to change, but when you have to change, and we are in the earliest days of truly mobile computing – an era in which people interact with the world around them in ways we could barely imagine just a few years ago. With BlackBerry, RIM created the framework that gave people their first taste of an untethered yet completely connected life.

As we prepare to launch our new mobile platform, BlackBerry 10, in the first quarter of next year, we expect to empower people as never before. BlackBerry 10 will connect users not just to each other, but to the embedded systems that run constantly in the background of everyday life – from parking meters and car computers to credit card machines and ticket counters.

Good luck with that.

RIM keeps delaying Blackberry 10. It was supposed to be out this fall, but now it’s Q1 2013. By then a new version of Android will have shipped and there’s likely to be an new iPhone out by then. Thus with no new product anytime soon and key competitors with plenty of product in the pipeline, there’s little reason to believe that anyone will care about Blackberry or anything else that RIM is planning to come out with.

Face it, investors have given up on RIM. Thus RIM is going direct to the public in the hope that this will change their fortunes. I’m here to say that it won’t. It’s game over for RIM. It’s only a matter of when and not if they’re sold in whole or in pieces or disappear.

Five years ago today the iPhone was released. RIM looked at the iPhone and considered it to be “impossible” at the time. So the fact that RIM stock took a 20% hit today is beyond ironic. It’s just a highlight of how far RIM has fallen. Here’s some other signs of how far RIM has fallen. As of late May, Blackberry held a paltry 6.4% of the smartphone market worldwide. Compare that to Apple who has 23% of the market and the big winner is Android who has a grand total of 59% of the market.

Sucks to be RIM.

There cannot be any way back for RIM now. It will either die or it will be sold in whole or in part. That’s too bad. But that’s what happens when you don’t take potential threats seriously.

Speaking of threats, Google announced a new version of Android and a new tablet this week. It really sucks to be RIM.

Mark today on your calendar. Today is the day that RIM officially died. They announced (Warning: PDF) their Q1 numbers and they were stunningly bad. The company lost $518 millon and they will cut 5000 jobs. But that’s not the worst news. The worst news is that BB10 which was supposed to save the company is pushed back until next year. That delay quite frankly will kill the company as with no new product, there’s no incentive to buy RIM products. Here’s how Thorsten Heins, President and CEO sees things:

“Our first quarter results reflect the market challenges I have outlined since my appointment as CEO at the end of January. I am not satisfied with these results and continue to work aggressively with all areas of the organization and the Board to implement meaningful changes to address the challenges, including a thoughtful realignment of resources and honing focus within the Company on areas that have the greatest opportunities,” said Thorsten Heins, President and CEO. “Our top priority going forward is the successful launch of our first BlackBerry 10 device, which we now anticipate will occur in the first quarter of calendar 2013. In parallel with the roll out of BlackBerry 10, we are aggressively working with our advisors on our strategic review and are actively evaluating ways to better leverage our assets and build on our strengths, including our growing BlackBerry subscriber base of approximately 78 million, our large enterprise installed base, our unique network architecture and our industry leading security capabilities.”

The market clearly doesn’t have a good feeling about their prospects. As I type this, their stock is down 16% in after hours trading. Seeing as the stock has lost 90% of it’s value in the last year and half, I’m guessing it’s about to lose the most of what’s left in the next few days. That will likely lead to a sale of the company in whole or in part… Assuming that the company doesn’t die first.

As for me who has been using RIM products for the last 7 years, time to look at an iPhone or an Android phone as that’s clearly where the future lies.

Yesterday, RIM announced and demoed the one thing that might save them from death. That’s the Blackberry 10 Platform. I watched the demo and it looks slick. It’s based on QNX which brings a serious backbone to the table, developers can code in very accessible ways, and it will be strong from a multimedia standpoint.

The problem is that it doesn’t matter.

Had they came out with this a year ago, this would give RIM a chance. But it’s coming at the 11th hour which is way too late. Android and the iPhone have won the smartphone wars. Or at least eliminated RIM from the battlefield. Oh, I should also mention the elephant in the room: There is no public ship date for any Blackberry with Blackberry 10. Simply saying “later this year” or “the second half of the year” doesn’t count.

Bottom line: Blackberry 10 is nice looking, but irrelevant.