With 78 million active users across 178 countries, RIM is no stranger to public recognition. Once the darling of the smartphone world, as Canadians we have been witness to a worldwide drubbing usually reserved for soccer teams and cheating celebrities.
But RIM evinces such visceral emotions in us because, like a dysfunctional family member we care about them whether we admit it or not, regardless of how many times they mess up. And the company’s latest quarterly result belies a corporate entity at the bottom of what could be a very long road back to health and recovery.
Andrew Macleod, RIM’s Managing Director for Canada, told me a lot of interesting things during a phone interview, but the one that stood out is what will make headlines: RIM has no intentions of going away. This in itself is not surprising: no company would admit to being in the lion’s jaw while their share price continues to sink. But Macleod was emphatic in that “everything about RIM seems to be heightened” recently. As a journalist writing day after day about a company whose fortunes have changed for the worse, it struck me as a very even-tempered approach to a dire situation; this is just one more story in the company’s history.
A lot of time was spent telling me about RIM’s excellent fundamentals: the company is debt-free and has $2 billion in the bank; and they are aiming to regain $1 billion in operating efficiencies, the 5000 layoffs contributing a great deal to that. But layoffs are not free — there are a lot of severances and pay-outs — and if the company continues to lose money every quarter, a great deal of that cash is going to disappear.
Macleod, however, is not worried — during this media blitz, in fact, he came across as cautiously ebullient — and assured me that BlackBerry 10 will be the whole package. When I pressed him on whether RIM will bundle content services such as movies, books, music with the new OS, he assured me without going into details that offerings will be competitive with current alternatives.
The new RIM, when BlackBerry 10 is released in Q1 2013, will be a leaner, meaner company. It will have thousands fewer employees and a renewed focus on core strengths: messaging services such as BBM; a newly-enthused developer community who, around the world, are ecstatic about the standards-compliant potential of BB10; the enterprise, with a rich business-centric rollout; and average consumers, who remain sceptical of RIM’s survival prospects.
Macleod was also humble, admitting that the company learned a lot from the botched launch of the PlayBook. The tablet, launched in April 2011, was considered largely unfinished. OS version 2.0, released a year later, proved that time may not be RIM’s strong suit, but they came through with a polished, reliable and largely beautiful piece of software.
The surge will be slow, and RIM knows this. Pundits, analysts and former fans are signing the company’s death certificate, and the share price continues to slide. After a $518 million loss last quarter, the first in the company’s history, taking the time to finish BlackBerry 10 and make it the best possible platform was a certainty. RIM can’t afford another botched product launch. BlackBerry 7, the company’s last legacy OS, had a tepid reception despite attractive handsets like the Bold 9900. In the long-run, Macleod admits, no one will remember a six month delay if it means the difference between a failure and a success.
What we’ve seen so far of BlackBerry 10 has us salivating, but RIM promises more in the coming months. From further opening up the platform to developers, improving SDKs and bolstering access to new and existing APIs, there is no question that success is possible for an independent RIM. Macleod wouldn’t comment on whether RIM is a purchase target for companies such as Facebook and Microsoft, though he said a massive restructuring may certainly be one of the recommendations by consulting firms RBC and JP Morgan, hired recently to oversee the company’s recovery.
The term “paradigm shift” gets thrown around a lot in the technology industry, but it couldn’t be more true for RIM’s next steps. They’re not the same company they were, on top of the world, in 2008. That so much could change in four short years speaks volumes about the speed of adoption, both a positive and negative development depending on which side of the consequence you sit. The last four years have been sweet to RIM’s competition; Macleod promises us that, starting in 2013, RIM will begin to regain that momentum and maybe, just maybe, by the middle of this decade we’ll be speaking of its greatness once again.