August 4, 2011
Eric Jackson, manager of Ironfire Capital, had some bold words Wednesday about Research In Motion. In short, he doesn't see the BlackBerry maker surviving past the first quarter of 2013 as an independent company.
Speaking to Business Insider, Jackson said of RIM, "It's a bad software company" and RIM's "not going to change their stripes over night." More to the point, Jackson blames RIM's co-CEOs, Mike Lazaridis and Jim Balsillie, for its troubles. The company has "bad co-founders, and they're going to drive this company straight into the ground," said Jackson. Some employees and shareholders might agree. What got Jackson's ire up? The new BlackBerrys announced by RIM on Wednesday. The company introduced a few new models that are--once again--incremental updates to previous devices. Jackson is right in pointing out that RIM is not a software company--or at least not an innovative one. Its BlackBerry smartphone platform may be stable and secure, but it is slow to add features, and isn't as flexible as the platforms being offered by the competition. RIM is and always has been a good hardware company, though it could take a few more risks in the design department as far as I am concerned. RIM has taken a risky shortcut in order to have something sitting on the shelves of its wireless network operator partner's stores for the next six months as it prepares its QNX-based smartphones. It refreshed existing form factors, bumped up the specs, put some spit and polish on the user interface, and hopes no one will notice that these are the same-old phones. Well, we noticed. Surely these new BlackBerries will fulfill their role as the stop-gap they are intended to be. Businesses and consumers alike will upgrade from old BlackBerrys to get the better performance and shinier tech from RIM. Meanwhile, RIM will continue to lose market share to Apple and Google. By the time its QNX smartphones hit the market (some time in the first half of 2012), RIM's position in the market will have sunk even further. Apple is preparing to unleash the iPhone 5, and the onslaught of new and exciting Android handsets shows no sign of stopping. RIM will face a difficult challenge convincing Android and iPhone users to abandon their gear for unproven BlackBerrys running a tablet OS that isn't very good at being a tablet OS. Jackson thinks that by the time the QNX BlackBerrys show up, RIM's stock will be battered down to the basement, making it a likely acquisition target. Given how much its stock as tanked (from $69 per share in February to just $23 per share as of noon on Thursday) in the last six months, it is not an unbelievable scenario. Attend Enterprise 2.0 Santa Clara, Nov. 14-17, 2011, and learn how to drive business value with collaboration, with an emphasis on how real customers are using social software to enable more productive workforces and to be more responsive and engaged with customers and business partners. Register today and save 30% off conference passes, or get a free expo pass with priority code CPHCES02. Find out more and register.
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