Wednesday, July 11, 2012

Bleak future for, RIM?

A business blog, 24/7 Wall St., recently published an article on the "10 Brands Likely to Disappear in 2013."  Among some of the higher-profile predictions (Oakland Raiders (likely to move), American Airlines) are the online news and commentary site, and mobile operator Research in Motion (RIM), the company behind the Blackberry mobile devices and service.
  The article indicates that has been eclipsed by larger and better-funded competition.  The article notes that during the last quarter of 2011, Salon posted operating losses of $997,000 against revenues of $1.03 million, and had a mere $149,000 in the bank - against short-term liabilities of more than $12.7 million.  The CEO (Chief Executive Officer) and CFO (Chief Financial Officer) both left, leaving the Chief Technology Officer in charge.
  Research in Motion once owned the smartphone market, and having a Blackberry was de rigueur for 'smart' business types.  RIM's share of the U.S. smartphone market has fallen from 44% in 2009 to 10% in 2011, and the price of its stock has fallen from $144/share just four years ago to around $11.
In just the past year ... the company has warned twice that it would miss its earnings forecast, replaced its long-time CEO, warned a third time about its first-quarter loss, and disclosed plans for layoffs of thousands of employees. The company’s board said it was reviewing “strategic options,” which would include a sale.
It seems increasingly unikely that RIM can survive the rapidly evolving mobile market on its own.  Analysts predict that its likely to be sold, either to an equipment maker looking to jump into mobile services, or a service-focused company (like Amazon or Facebook), looking for an entry into the mainstream mobile market.

Sources -  Ten Brands That Will Disappear in 201324/7 Wall St.
A Future for RIM?  Media Business and Future of Journalism blog (earlier post)

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