Perhaps BlackBerry's Travails Were Inevitable

Carl Weinschenk

Research In Motion's fight to save itself is an ongoing drama. One act in that drama was played out this week as CEO Thorsten Heins - who has been on the hot seat since late January - participated in a conference call on the company's latest results.


The quarterly numbers are available at the RIM website. The highlights include the fact that the company has $2.1 billion in cash on hand, a figure that increased $610 million during the fourth fiscal quarter of 2012, which ended March 3. Cash flow was up from $900 million to $1.1 billion. On the downside, revenue was $4.2 billion. That was down 19 percent from the second quarter and 25 percent from the year-ago quarter.

Heins acknowledged what everyone knows, which is that tough times are ahead. From the release:

Notwithstanding these strengths and opportunities, the business challenges we face over the next several quarters are significant and I am taking the necessary steps to address them

The eWeek story on the conference call said that RIM is rededicating itself to the business market. Heins, Jeffrey Burt reports, "essentially said the company would end its flirtation with the consumer market." That statement was juxtaposed against the related idea that one of the reasons that RIM and BlackBerry are in so much trouble is that they misjudged the bring-your-own-device (BYOD) trend.

While it is almost certain that RIM and BlackBerry made mistakes, it also is true that a certain inevitability contributed to RIM's troubles. The company had its great success when the line between consumer and enterprise communications was as tangible as the Iron Curtain. It stands to reason that a firm that made its fortune on one side of that barrier ran into problems when the Iron Curtain became the Iron Screen Door and, finally, all but disappeared.

The fact that the companies waiting to try to take its market share away included the likes of Apple, Google and, to a lesser but still significant extent, Microsoft didn't help. The interpretation that RIM misjudged BYOD isn't an indictment, since nobody knew it was coming. Branching off into the consumer sector, as RIM did, made sense. The bottom line is that RIM was the victim of its own mistakes and missteps - but also was poised for a fall that certainly would be dramatic.


There is a flood of links related to RIM's status on the Web. Telecommunications topics, including device makers, are hot - and people generally gravitate toward stories that in essence are slow-motion train wrecks. The Financial Post, for example, took a measured approach and suggested that the approach Heins is taking makes sense. Henry Blodget's Business Insider, on the other hand, offered a story headlined "Here Are 11 Desperate Companies That Might Buy RIM."



Add Comment      Leave a comment on this blog post
May 22, 2012 10:46 AM S?st?ata ?sfa?e?a? S?st?ata ?sfa?e?a?  says:

And the war goes corporate ....

Thanks for the information Carl!

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