RIM: Time to plan your Enterprise Exit Strategy

By Jim Lundy

RIM (Research in Motion) reported poor earnings this week, but more importantly, they announced a slip of the new QNX powered Blackberry 10 Phones until 2013.  Technology markets can be brutal and today, a product slip of even a few months can have a devastating impact.  It is hard to blame RIM CEO Thorsten Heins, since he inherited most of the issues that RIM is facing. Nonetheless, we don’t see things getting better for RIM (note, we review RIM and other Mobile Ecosystems providers in our Strategic Report). Note, this post is directly related to RIMs recent actions and statements about their direction.

RIM Hires Banks to explore Options

What is the most damaging to RIM is that they announced that they hired two banks (J.P. Morgan Securities LLC and RBC Capital Markets) to explore their options. Their specific statements included “strategic review we referenced on our year-end financial results conference call to evaluate relative merits and feasibility of various financial strategies, including opportunities to leverage the BlackBerry platform through partnerships, licensing opportunities and strategic business model alternatives“. If we translate that, it means that RIM is actively planning their possible financial exit strategies.

Develop your RIM Exit Strategy Now

While we will dive deeper into this topic in our premium research and in our trusted advisory discussions with clients, our bottom-line for enterprises is that it is time to start planning your exit strategy now. An exit strategy has different elements and one of them is a plan that can be executed if a critical supplier falters. In the case of RIM, large enterprises, including governments, need to start that exit strategy planning now.

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