RIM Futures: Exit Strategy and Contingency Plans

By Mike Anderson

RIM (Research in Motion) once ruled in smartphones. With BlackBerry it provided secure wireless email, a great keyboard-based user experience, and a simple and popular instant messaging system. The ability to connect people to their company email anywhere and any time created a generation of wireless email addicts.

RIM Overconfidence is its Undoing

With its BlackBerry success, RIM was overconfident in its enterprise leadership position and let its lead slip away. It missed the shift to consumers, and the breadth of computing capabilities they would demand. It missed the shift to touch. It missed the shift to apps beyond email and messaging as major drivers. It missed the shift from security-first toward user functionality and experience. It missed the imperative to have a strong ecosystem with a modern OS platform, strong developer support, lots of apps, and access to content that users want.

RIM Open To Exit Strategy

The result for RIM has been a precipitous drop in market share, quarterly losses that are expected to continue, job cuts, and a strategic review considering all options as possibilities for the future of the company. They hired two banks (J.P. Morgan Securities LLC and RBC Capital Markets) to help with the review and consideration of changes like splitting the business, taking new partnership approaches, licensing software and patents, or possibly selling the company. Another delay in delivery timing of its BlackBerry 10 OS into 2013 has added more uncertainty, and increased the financial drain on its large cash reserve.

RIM BlackBerry 10 is RIM’s Future

One big challenge is that the future of RIM rests on the BlackBerry 10 OS, and that will prove of no use to current BlackBerry devices or users. Only new BlackBerry 10 devices will be able to run the new OS. RIM is actively seeking other manufacturers to license BlackBerry 10 to create a broader platform and attract the necessary developer ecosystem. So all current users need a migration plan – whether they continue with RIM or take a new path. So make your contingency plans with an exit strategy built in.

RIM Contingency Plans Needed Now

Many enterprises have the contingency planning underway. Those who have not need to get started now. Should RIM come undone, new device, messaging and mobile management is needed. Regardless, the environment is no longer a BlackBerry exclusive, so multi-vendor mobile also requires a new approach. Watch for our upcoming research that focuses on planning your RIM exit strategy.

Check back at Aragon Research for ongoing analysis of this situation at RIM, as well as other mobile providers.