Research In Motion is in trouble. The BlackBerry maker has been suffering from an identity crisis for the last six months, which has resulted in mass layoffs, lots of job shuffling, dramatic drop-offs in market share and a quickly decaying portfolio for investors. But not according to newly-appointed CEO Thorsten Heins; in his eyes, RIM is all roses and rainbows and puppy kisses right now!
Heins penned his thoughts in an op-ed for the Toronto Globe and Mail on Tuesday:
Don't count BlackBerry out, Heins started. In recent weeks, it's become fashionable for pundits and market watchers to alternately eulogize Research In Motion as a fallen pioneer and demonize management for not chopping up the company to sell for parts. As President and CEO of RIM, I understand the frustration and impatience of RIM's shareholders and their eagerness to see the company start to surface the underlying value we all know exists at RIM. But we do not believe RIM is a company at the end. Nor do RIM's current challenges hint at a larger Canadian problem of not being able to sustain successful technology companies.
Heins reminded his audience of BlackBerry's former prominence, and he mentioned that RIM is simply at the beginning of a transition to truly mobile computing. Instead, Heins believes RIM's best is yet to come.
As we prepare to launch our new mobile platform, BlackBerry 10, in the first quarter of next year, we expect to empower people as never before, Heins said. BlackBerry 10 will connect users not just to each other, but to the embedded systems that run constantly in the background of everyday life -- from parking meters and car computers to credit card machines and ticket counters.
Heins has some lofty hopes for BlackBerry 10, and he acknowledges that many doubt RIM's ability to pull off another successful product, especially given the increased competition in the smartphone department from Google and Apple.
I am the first to admit that RIM has missed on important trends in the smart-phone industry -- especially in the consumer domain, focusing on its core value system for successful products and services, Heins said. We are working diligently on BlackBerry 10 in order to provide a compelling experience for our loyal enterprise customers and consumers. While we are in a very competitive and constantly changing market, customers benefit from this competition and continued innovation.
Heins argues that the smartphone industry is desperate for alternatives -- which is why RIM is attempting to build itself from the ground up by reshaping its executive team and recruiting new employees (veterans) from the telecom industry. The corporate overhaul hopes to reduce RIM's annual operating expenses by more than $1 billion, and in the meantime, RIM will use its $2 billion in cash and subscriber base of 78 million people in 175 countries to refocus the organization into a lean, nimble organization focused intently on bringing BlackBerry 10 to market. (No pressure on BlackBerry 10, by the way. Not at all.)
Has Heins Officially Lost It?
I'm not sure what literature Heins is reading, but if he knows about the dire state of his company, then he is simply in denial. To say that there's nothing wrong with RIM just a week after the company posted its first loss in eight years, AND delayed BlackBerry 10 until 2013, is just plain ridiculous. Unfortunately, Heins is quickly turning into the executives RIM sought to replace.
Heins knows RIM very well, from the inside and out. Prior to being named president and CEO in January, Heins served as the company's COO of Product Engineering since 2007, and he oversaw the entire BlackBerry smartphone portfolio, including hardware, software and sales. As many know, the BlackBerry smartphones have almost singlehandedly kept the company afloat, particularly RIM's popular BlackBerry 7 released in 2011.
Before he joined the BlackBerry team, Heins was RIM's rival when he worked as chief technology officer for Siemens' Communication Division, serving as chief executive in several other Siemens divisions since 1984.
When Heins replaced RIM's ousted co-CEOs Jim Balsillie and Mike Lazaridis, he was charged with making sure RIM had the right people in the right positions before moving forward with more products. But while the repositioning could create long-term growth, the short-term outlook appears absolutely dismal. It'll be considerably worse by the time RIM is ready to release BlackBerry 10; by then, Apple and Google will have already released their next-generation smartphones, which both look to run on vastly superior operating systems to RIM's.
Heins is trying to boost morale at RIM, but he's not going to do it by denying anything wrong with the company. Heins put his foot in his mouth again this morning, this time on CBC Radio :
There's nothing wrong with the company as it exists right now, Heins said. I'm not talking about the company as I, kind of, took it over six months ago. I'm talking about the company (in the) state it's in right now. This company is not ignoring the world out there, nor is it in a death spiral.
By no means is Heins supposed to say RIM is terminal, but to paint a very troubled company as one filled with hope and opportunity is simply hogwash. Heins qualified his statements on the radio.
Yes, it is very, very challenged at the moment - specifically in the U.S. market. The way I would describe it: we're in the middle of a transition, Heins said. All that is in the making, it's in the works. This company is in the middle of it and I'm positive we will emerge successfully from that transition.
RIM's future is a big case of wait and see. BlackBerry shipments are declining, the number of new subscribers is slowing, and delaying BlackBerry 10 is basically sabotaging the company's own future. By the time it's ready for release, who knows where RIM will be by then?