silicon.com chief reporter Nick Heath argues that at a time of unparalleled challenge for RIM the company neededs to make some bold moves, fast.
Smartphone maker RIM is hoping the man to revive its flagging fortunes is its new CEO Thorsten Heins, promoted from COO to replace Mike Lazaridis and Jim Balsillie. He’s going to have to move fast.
RIM is a company that is percived to have lost its way, that failed to keep pace with its competitors in the market for smartphones and tablets - and whose failure to innovate has seen its star products reduced from must-haves to also-ran status. Consequently its share price has tumbled - dropping some 70 per cent during the last year.
It’s a predicament that bears some resemblance to Apple in 1996 or Nokia in 2010, however unlike either of these companies, RIM hasn’t opted for radical change at the top.
Instead of bringing in new ideas from outside - someone not afraid of scorching some earth and tearing up the status quo, RIM has picked the man who was effectively the number three in the company. Heins will need to prove that he has the fresh ideas that RIM needs.
Perhaps doing away with the unusual co-CEO structure that RIM has used will be enough to get the creative juices flowing again. But the scale of the challenge facing RIM suggests that radical action is necessary.
RIM needs to perfect a complete reboot of the core platform for its BlackBerry handsets before the end of the year without compromising on quality. When it releases its BlackBerry 10 handset later this year it will have to deliver a platform with functionality, services and an ecosystem of apps far in advance that offered by its current handsets if it is to compete with the Android and iOS devices already on the market.
As Nick Dillon, analyst with Ovum, puts it: “They’re a long way behind their competitors from a technology point of view.”
The company also needs to be willing to sever ties with its past: to not be afraid to move away from the Qwerty keyboard and get seriously into touch, which is where the market momentum is.
RIM also needs to be willing to thin out its portfolio of handsets, cutting out near identikit devices that drive up its cost base. It needs to figure out whether it can really sell to both businesses and consumers at the same time and excel at both.
None of these changes are particulary profound. Indeed, they are obvious and should have been taken long ago.
So the question that must be asked is just how realistic is Heins about the situation that RIM is in and how willing he is to tackle these tasks?
In a speech released on YouTube he said: “At the core of RIM is innovation, we always think ahead, we always think ahead, we sometimes think the unthinkable - this is the core of any technology company.”
The problem is that, as Gartner analyst Carolina Milanesi told me, innovation has not exactly been RIM’s strong suit of late. “Yes the Qwerty keyboard was the best Qwerty, but from a device perspective - apart from BlackBerry Messenger - I’ve not seen a great deal of innovation over the past couple of years and that’s exactly the issue.”
Gartner’s Milanesi said that the appointment of Heins is reminiscent of the board reshuffle that Nokia carried out in Spring 2010, before it transpired that a more far reaching change was required at the top and it appointed Elop.
All of which means Heins needs to move fast to forge - and articulate - a new strategy for RIM if it wants to recreate the must-have aura of its ‘crackberry’ past.