News surfaced today that Research In Motion Limited (USA) (NASDAQ:RIMM) former CEO Jim Balsillie tried to completely turn around the company’s prospects with a radical new strategy just before he left the position. The news was reported by Reuters Alastair Sharp this morning. The news reveals much about the internal workings of a company that has struggled in recent times. The report suggests that the company’s rejection of a strategy that might have saved the company from its current disappointing market position led directly to the executive’s resignation.
The strategy would have seen a new sales platform that would allow the company to provide its propriety data transmission system on devices that are not manufactured by the company. One of the Blackberry’s major advantages listed in the past was the proprietary system which routes messages and calls through the company’s servers allowing greater security for users. Allowing other device manufacturers to use the company’s data system could have created an interesting second tier of smartphones in the market that would have seen lower data rates being charged with users not having access to full data capability but instead just social media sites, email and other popular data uses.
That move would have been a huge change for Research In Motion as it has defended the exclusive nature of its data network since it first began offering Blackberries to consumers. The conflict within the company caused by such a turnaround was obviously too much to handle and so they are left struggling on the path that has shown them lagging in the market. The company is putting all of its eggs into its Blacberry 10 basket. The new OS which will come with a new range of Blacberry handsets is the company’s only real strategy going forward. Apart from the hopeful success of that often delayed technology the company hopes to defend the market shares it holds in developing countries though they are now under serious attack from competitors offering phones with more features.
Blackberry has shed around 80% of its value since last February as the company, once the leader in smart phones, has failed to compete with Apple’s iOS and Google’s Android in features and marketing. The company’s failure to catch up quickly enough is still working against them and anything but popular acclaim for its Blackberry 10 series could relegate the company into technology history. Investors beware of this risky investment.
