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Jim Basillie and Mike Lazaridis have come under fire from investors of Research in Motion, who insist major change is needed.  (Source: RIM)

A sale to a rival, such as Google, is one possible solution, according to investors.  (Source: Despuesdegoogle)
Two separate proposals suggest sale of intellectual property and shakeup of executive ranks

Waterloo, Ontario-based Research in Motion, Ltd. (TSE:RIM) circa 2006-2007 appeared unstoppable.  The company was beloved by businesses worldwide and was growing fast in market share and sales.  Even Democratic Presidential hopeful Sen. Barrack Obama was deeply attached to his BlackBerry smartphone.

I. Should RIM Sell Itself?

Fast-forward five years and that vibrant company is an increasingly distant memory.  In its place is a company with a slow pace of releases, dated hardware (
the Blackberry 9860, to launch in October, will be BlackBerry's first and only smartphone this fall to compete with Apple, Inc.'s (AAPL) iPhone and Google Inc.'s (GOOG) Android hardware-wise).  Unsurprisingly sales growth has slumped both in the U.S. and abroad.  Correspondingly, the company's stock has taken a beating at the Toronto Stock Exchange.

Investors, desperate to see a turnaround, have implored RIM to explore a pair of options.

The latest effort suggests that RIM sell its rich catalog of intellectual property -- or perhaps sell its entire business to the highest bidder.  Investors salivated at Google's 
recent purchase of Motorola Mobility, which brought a handsome return for shareholders.  A RIM sale would help investors recoup their losses and perhaps even profit.

Google and others are thought to be potential buyers.

The proposal is being spearheaded by Jaguar Financial Corp. (
TSE:JFC).  JFC refuses to reveal the size of its stake in RIM, but it says it represents a coalition of various shareholders who together hold a bit under 5 percent of the company's stock (RIM has a market cap of $16.45B USD at present, so this works out to roughly $822M USD in stock).

II. Second Proposal Suggests Shakeup in Top Executive Positions

JFC CEO Vic Alboini also expressed dismay at the company's lackluster response to a second independent proposal.  

The Northwest & Ethical Investments LP in June said that RIM's Jim Balsillie and Mike Lazaridis's decision to split Chairman and CEO duties was adversely affecting the company.  They suggested the company assign one executive to each post.

RIM agreed to examine the proposal, but said they probably wouldn't get around to announcing their thoughts until January 2012.  Mr. Alboini called that slow response "woefully inadequate" and "an extreme example that management has not let go."

III. If QNX Bid Fails Will RIM Become Nortel 2.0?

Mr. Alboini is also pessimistic about RIM's last-ditch turnaround effort with its new QNX operating system.  The new operating system, which debuted on the company's PlayBook tablet, is
scheduled to roll out to the company's smartphones next year, replacing the veteran BlackBerry operating system.

Thus far, however, QNX has 
drawn mixed reviews, with many saying the best thing about it is the ability to play (some) Android apps on it.  However, many fear that Google may close that route as more RIM devices adopt QNX.

While Mr. Alboini admits that it could have a positive impact, he says the cost of failure is to great to gamble by counting on such a success.  He remarks in a Bloomberg 
interview, "The board should be saying, 'What if these products don’t pan out?' You don’t want RIM to turn into another Nortel."

Nortel Networks, like RIM, used to be a highly prized Canadian mobile services firm.  But stagnation 
bred an eventual bankruptcy and fire sale of the company's intellectual property in a bid by shareholders to recoup part of their losses.

Mr. Alboini fears RIM could eventually meet a similar fate and says the time to act is now.  And he's not alone.  In a highly publicized letter, a departing executive 
lashed out at the company's leadership for failing to respond to the changing market.  He remarked, "I have lost confidence. While I hide it at work, my passion has been sapped. I know I am not alone..."

RIM categorically rejected the criticism, insisting it was doing just fine.

Comments     Threshold

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By nocturne_81 on 9/8/2011 7:52:06 AM , Rating: 1
The exact point I was trying to make was that if you don't own or haven't used a product, what right do you have to say that it holds no value?

I honestly don't care what trolls like you claim in the comments section without any experience or knowledge -- I was more or less referring to the many pseudo-reviews published on this very site (and many others) that claimed knowledge of a product without reference, which incites that it is indeed firsthand knowledge.

For example (for fictional purposes only... *wink*), lets say you have an author named.. lets say, 'Mason Dick'. Now, Mason Dick has no firsthand knowledge of a product, lets call it the 'MuchPad'. Now, Mason doesn't own a MuchPad, has never used one, and by his comments, it seems he has no idea what it really is.

Now, Mason Dick proceeds to publish many articles under the heading of this site blasting the MuchPad, without any 'editorial' prefix that would identify it as opinion rather than fact. But Mason isn't alone -- many other 'wanna-be' bloggers do exactly the same thing. Now, despite having absolutely no firsthand experience with the MuchPad, Mason helps humiliate the product's manufacturer, let's call it 'TP', so much that they completely discontinue the product and attempt to sell off the remaining stock at a loss. Unfortunately, TP invested so much faith in the MuchPad -- it can't stomach the failure; so they fire their CEO, and attempt spin off the consumer side of their business responsible for the failure so it can't affect stock prices any further...

Now, that's not the end of this 'fairy' tale.. Mason Dick now purchases a heavily discounted MuchPad during the resulting fire sale. Finally having the product in hand, Mason now publishes a glowing 'review' of the MuchPad. Though noting it's few deficiencies (as a result of the product only being 7 weeks old); Mason exclaims how satisfied he is with the product, lauding the many features it brought to the table in an incredibly small and cramped market.

Unfortunately, this isn't any fairy tale..

By Pirks on 9/8/2011 12:53:15 PM , Rating: 2
if you don't own or haven't used a product, what right do you have to say that it holds no value?
All these dumb trolls like Mick and Subzero have never tried the RIM stuff but they love to bash it. Just like Motoman loves to bash Apple. Same level of idiocy.

By mkrech on 9/8/2011 1:22:00 PM , Rating: 2
Wow Pirks. Easy there.

How about this... I'll bet you your choice of wager amount that within 2 years, RIM will be bankrupt, sold to another company or separately struggling to make a profit and it's phone sales will not even be in the top 5 worldwide.

What do you say?

Not hating, just knowing.

By mkrech on 9/8/2011 1:25:12 PM , Rating: 2
oops delete that "separately"

meant to say desperately... dang spell czech'r ;)

anyway, you get the idea.

By Pirks on 9/8/2011 1:32:26 PM , Rating: 2
"I'll bet you your choice of wager amount that within 2 years, Apple will be bankrupt, sold to another company or separately struggling to make a profit and it's Mac sales will not even be in the top 5 worldwide."

^^^ (C) Mike Dell, circa 1998 or so

By mkrech on 9/8/2011 1:38:21 PM , Rating: 2
Good point, but I don't think Jobs is planning on going to work for RIM.

You think there is someone else who can lead them? That would really be interesting and I agree, it could certainly happen. After all, Apple would have certainly failed if it had not changed course, whether through Jobs' leadership or someone else.

However, you would have to agree with me that an Apple type turn around would be an unlikely, although not impossible, future.

By Pirks on 9/8/2011 2:05:13 PM , Rating: 2
However, you would have to agree with me that an Apple type turn around would be an unlikely, although not impossible, future
MS or IBM never had any "turnarounds", did they die because of that? No. Did they die because Jobs was not working there? No. Does their stock price suck compared to Apple? Yes. Did they die because of their comparatively low stock price? No.

Same logic applies to RIM.

By mkrech on 9/8/2011 3:57:30 PM , Rating: 2
Now your reaching to far. MS and IBM are drastically different from RIM... and as such, the appearance of their demise will look different. But, if you speed up the process to normalize the differences between the companies, you will find the result is the same.

Basically, if you are driving toward a tree, your only choices are change directions, come to a stop, or crash into it. RIM is driving toward a tree, something must change. Pressing the gas pedal is not a wise choice.

By Pirks on 9/8/2011 4:09:37 PM , Rating: 2
you will find the result is the same
Yeah, the result is that everyone eventually dies. Even Apple. Can you believe this? :)
Pressing the gas pedal is not a wise choice
RIM turns the steering wheel and changes its direction instead of just pressing gas pedal. Hence it looks they are safe for now.

By mkrech on 9/8/2011 1:33:09 PM , Rating: 2
Nice if you like skiing.

By Pirks on 9/8/2011 2:10:11 PM , Rating: 2
That upwards slope to the right (Aug 11-Sep 11) is not ski friendly. When it grows longer and higher all the clueless anti-RIM trolls like Mick and Subzero will finally shut up.

By mkrech on 9/8/2011 4:09:06 PM , Rating: 2

By Pirks on 9/8/2011 4:18:52 PM , Rating: 2
I bet on AAPL once and I lost a couple of grand, so of course I won't put any bets on stocks that are weaker than AAPL. I think RIMM will go up because after I used their newer products (Playbook and new full screen Torch) I very much liked the direction they took.

"The whole principle [of censorship] is wrong. It's like demanding that grown men live on skim milk because the baby can't have steak." -- Robert Heinlein

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