Does RIM have a future?

An article by Dan Frommer on Business Insider prompted me to write this post. In its piece, Dan argues that RIM is the next Palm, pointing out similarities between the two companies. Palm used to sell tons of Treo devices just like RIM does today, but it failed eventually (and was acquired by HP). The big difference between the two is that in addition to devices, RIM is also focused on services and has been acquiring companies left and right to further strengthen its position. However, tough times are ahead of RIM…

I used to argue with our BlackBerry-lovin’ Simon on whether RIM has a future. As you can imagine, he defended his homeland company while I was fighting in the other direction. I have three points to share which go against RIM’s future prospects:

First, it’s important to note that RIM doesn’t own patents for GSM or CDMA communications and has to buy those licences for each product it ships. Major handset makers (Nokia, Samsung, Motorola, Sony Ericsson) do have those patents or at least take advantage of cross-licensing agreements; whereas some other companies like Apple and HTC don’t [own licences]. These two, however, are known for their high-end and mid-range devices (HTC) which bear higher margins (and higher profits).

Second, analysts (and myself) believe BlackBerry devices are slated for the mid-range of the market and that could disrupt RIM’s earning potential. We did hear some rumors about the BlackBerry tablet (which could be a higher-end product), but at the moment it’s unclear who would want such a device — though we still have to see it in action. Moreover, BlackBerry Torch isn’t selling like crazy

And, third – increased competition, not only from the iPhone but from an array of Android handset makers.

So what should RIM do to save its ass? Switching to Android is one of the options, and that’s probably their best bet. On the other hand, they invested tons of cash in their own platform, so I doubt that will happen… at least not that fast.

RIM has done a great favor to the whole industry by revolutionizing the use of email on mobile phones, but does it have what it takes for the next step? Personally, I’m not that confident. what do you think?

  • I do agree and see it pretty much the same way. And as mentioned above, competition is though, we’re talkin about Android resp. Google.
    If RIM wants to keep up with the race, the only way to save their position would be by purchasing a suitable technology/OS, or getting into an alliance such as offering devices with Android.

    Any attempt to maintain the status they had, without taking drastic measures will most probably fail.

    As from a consumers perspective, i coulnd’t care less about the brand, instead i’d always go for the product that offers the most. And RIM currently offers little but nothing, OS6 has a few appealing widgets in the GUI, the problems with memory leak etc haven’t been solved at all.

  • Hussa

    Apps apps apps!
    In order to survive and compete with the likes of iPhone and Android devices, Blackberry will need to step up its app offerings. Appworld is pretty much a fail and the fact that people in some regions still cannot even download appworld is ridiculous!

    The simple fact is this, in the region where I live,:
    1. people buy Blackberry devices mostly for BBM and email
    2. people are switching to iPhone devices because of its fun apps

    Step it up made people switch from Nokia to Blackberry- you can still hold that market share

  • Jason G

    The fact that people can really compare RIM to Palm is really a disgrace!

    1. Palm had 5 carrier’s RIM has 550.

    2. RIM acquired QNX, a 30 Year old OS Company that has been around way longer than Android, Apple put together. The fact that
    QNX can port Opensource projects easily is a Plus for RIM!

    3. The fact Google is getting Sued by Oracle is another reason you should not be going with Android, cause really Oracle is going for pushing it off the shelf!

    Take my word, or don’t take it, I really don’t care, but if you listen to these fools, that don’t do they’re reasearch before they write an article about RIM… Then you’re in the same boat they are in!

  • @Jason G
    Fair points on the first thing, I don’t agree on the rest.

    2. So? Do you really think QNX will go from app to app and make it work on BlackBerry OS? Attracting (more) developers to the platform is what is needed.

    3. The fact Google is sued by Oracle doesn’t mean a thing. Many companies sued Microsoft and they’re still releasing Windows and Office. They’ll definitely settle if there are some disputes found.

    Finally, I don’t agree with your “either you’re a fool or you believe in RIM” point. We can doubt in ANYTHING, RIM – naturally – included. Analysts see one thing – falling margins, no high-end handsets while competition is releasing phones clocking at 1GHz….

  • Jason G

    I believe that RIM is definitely working on Harmonizing the platform, Honestly we will not find that until QNX comes in to place… Behind the platform based off of QNX will be some great hardware… Rumored Black pad is running QNX, 1GHZ, 16MP Dual Cameras, Flash, etc….

    Second… Where analyst’s see things are not always where things lie… Analyst’s for a fact are looking at present and not Future… With QNX behind the scenes, really anything is possible… 3Com Audrey which was QNX based in 1999 was ahead of it’s time… Look in Wikipedia…

    The fact that analyst’s and people in General throw they’re biased opinion without considering any factors of what RIM and QNX can come up with for the future … They base it off of the present!!!

    You honestly can’t judge a book by it’s cover… But then again nobody is as level headed as me. It’s true that the android can do great things, and google might have a great battle on it’s hands, and may even go bankrupt, cause Oracle owns Sun Micro, which is the based platform for yours truly Blackberry!!! LOL!!! Interesting things are yet to come!!!

  • David

    I agree. I’m a Blackberry user and I can’t wait for my contract to expire and get and HTC. It’s the Apps but also its whole feel and touch is so yesteryear that it feels like an xp in windows 7 era.

  • omar

    RIM is improving i have faith in them with the release of os 6 and upcoming devices like the blackberry bold touch and the storm 3 and curve apollo they will improve i am sure of it. they bought TAT,GIST to spice up their phones and tinyHippos is helping them in app world it’s just the way of RIM telling you that they’re not giving up easily and they’ll be back in action again

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