Yesterday's Heroes: Nokia and Research In Motion on Thin Ice

Carl Weinschenk

One of the most popular parlor games — at least for those whose jobs are not on the line — is guessing which companies are doomed and which can right themselves at the last moment.

Currently, the two mobile companies that are the subject of the most conjecture are Research In Motion and Nokia. Their back stories have some similarities. Both once ruled their respective roosts: RIM dominated the early mobile business email market and Nokia was a consumer powerhouse. Both were dethroned by Google, Apple and other aggressive competitors. Both still have significant assets and very high profiles.

There are differences in the particulars, of course, and the way in which the companies are reacting. Nokia essentially has gone all in with Microsoft, another company that has struggled in the mobile sector. Research In Motion, meanwhile, has delayed the rollout of BlackBerry 10 and seems a bit more confused. The company, at its shareholders' meeting this week, said that the new target date is January. It is purposely waiting until the holiday season ends, according to The Washington Post. There is no guarantee, the story says, that carrier testing will be done in order to meet that timeframe, however.

There currently is more overt pressure on RIM. The company has gone through well-publicized management shakeups and says that it is open to other changes. The sense with Nokia is that whether the Microsoft arrangement will pay dividends is a longer-form drama. Observers also suggest that the company’s salvation — if it comes — could be with emerging markets that are farther from the hearts, minds and immediate concerns of a generation of workers who grew up (at least professionally) with BlackBerry. Nokia, it should be noted, got some good news last week via an announcement that Finnish startup Jolla Mobile will use MeeGo, its open source operating system, on a phone.

When the history of the current era is written, the two companies will be considered together, perhaps more than they are today.

An unnamed investor writing about the two at Seeking Alpha goes into detail about the finances. The bottom line is that he feels that the death notices are premature and that both companies have an upside for investors. Of course, his opinion on the positive possibilities is seen in the context of the companies’ value now. But the bigger frame is that he expects them to survive.

Last month, ZDNet ran a debate between two editors on whether the companies would survive. Matthew Miller gave what seemed to be a qualified yes, Jason Perlow said no. The decider was Jason Hiner, who sided with Perlow in the negative.

Nobody knows for certain, of course. What does seem clear is that the fate of both companies likely will be settled sooner rather than later. The Microsoft partnership so far is not paying off for either Microsoft or Nokia. Vanity Fair contributing editor Kurt Eichenwald has a cover story on the company. He appeared earlier this week on the "Charlie Rose" show and seemed less than bullish on the giant’s future.

The situation concerning RIM is a bit more fluid and will remain so until the results from BlackBerry 10 start coming in during the early months of 2013. At this point, however, the question is how long a company can exist in such a state of uncertainty.

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