Microsoft Spooning BlackBerry? I Think Not - InformationWeek

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8/30/2007
04:13 PM
Richard Martin
Richard Martin
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Microsoft Spooning BlackBerry? I Think Not

The ripple effects in the mobile and wireless market continue to spread, in ever more Byzantine ways. Today Reuters reports that "Research in Motion Ltd shares rose more than 3 percent on Thursday on renewed market speculation that Microsoft Corp could be interested in buying the BlackBerry maker." This according to one analyst would be "in response to Google's recent announcement that it is interested in ma

The ripple effects in the mobile and wireless market continue to spread, in ever more Byzantine ways. Today Reuters reports that "Research in Motion Ltd shares rose more than 3 percent on Thursday on renewed market speculation that Microsoft Corp could be interested in buying the BlackBerry maker."

This according to one analyst would be "in response to Google's recent announcement that it is interested in making its own mobile phone operating system, which would compete with Windows Mobile." I'm with Barron's tech blogger Eric Savitz on this one: I don't buy it.For one thing, as Savitz points out, Microsoft would be spending something close to 22% of its market cap on a company that produces 10% of Redmond's revenues. More importantly, buying RIM would not help MS's strategic position vis a vis whatever Google's mobile play turns out to be. As beloved as the BlackBerry is among the corporate elite, RIM is a company with a proprietary operating system that competes directly with handset vendors using Windows Mobile and that risks being outflanked by more open systems including Symbian, which dominates the R.O.W. - the rest of the world outside North America.

Even if Google releases a "gPhone" with a Google OS, it will be based on an open-standards/open-services model - Eric Schmidt hasn't preached for years about the glories of unfettered access to Google search and Google apps to now try and reproduce the BlackBerry's closed universe. Microsoft would be foolish to try and compete that way.

What these rumors indicate is the level of fevered speculation around Google and its mobile plans, which have reached a new high this week. Steve Ballmer and Ray Ozzie are certainly contemplating some kind of response to Google's mobility ambitions, but buying RIM is not one of them.

Besides, can anyone imagine Ballmer and RIM co-CEO Jim Balsillie in the same room together?

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