RIM Tries to Sell Customers on Defunct Operating System, Bleeds Money
April 11, 2012 3:04 PM
comment(s) - last by
Company reportedly loses 4 percent of average revenue from each new handset
gleams in new articles and slide shows put on by Waterloo, Ontario-based phonemaker Research in Motion, Ltd. (
a star of the phone world
, RIM helped define what is today called a "smartphone". But the company has fallen on hard times.
BlackBerry 10 -- or BB10, in shorthand -- offers seemingly everything RIM needs to recoup. It offers a stylish new interface built on RIM's acquired QNX operating system. And it comes on gorgeous LTE-enabled handhelds like the
But BB10 will not arrive until Q3 2012 at the soonest, a delay that has many wondering whether it will be too little, too late when it does finally arrive. For now RIM is selling what it's already conceded is, in effect, a defunct operating system -- BlackBerry 7 (BB7). After examining operating costs and inventory costs, Peter Misek, an analyst at investment banking firm Jefferies, found that RIM is spent 4 percent more per handset than it took in, in 2011.
The report is a dire sign for RIM, who is expected to perform its third inventory write-off for Q2 2012, which will be reported on September 1. Meanwhile Mr. Misek
in an interview that RIM is pumping increasing amounts of cash into advertising and price cuts, in a bid to get customers to buy its effectively defunct BB7 devices. PlayBook tablets currently retail for less than half their original MSRP.
RIM has spent heavily to advertise its PlayBook tablet and its BlackBerry smartphones, and to engage in aggressive price cuts. [Image Source: Photoree]
He adds, "The other key thing from this is that it's not likely to get better anytime soon, because until BB 10 devices are out they're going to have to keep cutting prices."
RIM has cancelled all future financial forecasts after posting its
first loss in years in Q4 2011
. That loss led to Jim Balsillie -- longtime board chairman and co-CEO -- to be dismissed from his board position, just months after he and his fellow co-CEO Mike Lazaridis were
fired from the chief executive spot
New chief executive Thorsten Heins has said he is considering transforming RIM into a licensed services company or selling RIM's assets to allow investors to recoup a portion of their recent losses. The Canadian government has
green lit a potential sale of RIM
, but any such purchase would likely have to pass the scrutiny of the
U.S. Department of Defense
, a heavy BlackBerry user.
A coalition of rappers and ex-convicts including Dr. Nono Pearson and famed cocaine dealer "Freeway" Ricky Ross recently offered a
bizarre offer to buy RIM for ~$1B USD
. The offer was met with skepticism, which was amplified by the coalition's Geocities-looking homepage and the fact that the coalitions recent charity drive, which aimed to raise "millions" had thus far raised only $5, according to the webpage.
This article is over a month old, voting and posting comments is disabled
The business end
4/11/2012 10:10:20 PM
RIM thought they had the business end of things all tied up back in 2007. They looked at the iphone and just thought of it as a toy, whereas the Blackberry was THE business phone.
They had vision when they first started blackberry but lost it somewhere along the way. The iphone is/was (along with andriod now)are basically mini computers that comes with a phone. You choose the apps that you need....either to play or to do real work.
This sort of reminds me of back in the 80's with Wang....dedicated system dedicated to only a few jobs - mostly word processing. PC...open system that can do anything that there is a program to do it with. And we know who won that battle.
"Folks that want porn can buy an Android phone." -- Steve Jobs
"Country" Rapper Aims to Buy RIM; BlackBerries Still Poking Around in D.C.
April 5, 2012, 11:48 AM
Canadian Gov't Greenlights Potential Sale of Research in Motion
April 2, 2012, 2:31 PM
RIM Sinks Further with $125M Fiscal Q4 Loss, Key Execs Leave
March 29, 2012, 9:14 PM
Sleek BlackBerry London Leaks, RIM Prepares PlayBook OS 2.0
February 2, 2012, 12:31 PM
Co-CEOs Balsillie and Lazaridis Kicked Off Sinking RIM Ship, COO to Step In
January 22, 2012, 9:40 PM
Inspiron Laptops & 2-in-1 PCs
September 25, 2016, 9:00 AM
The Samsung Galaxy S7
September 14, 2016, 6:00 AM
Apple Watch 2 – Coming September 7th
September 3, 2016, 6:30 AM
Apple says “See you on the 7th.”
September 1, 2016, 6:30 AM
Apple sued because of iPhone 6 Touch Disease
August 31, 2016, 7:00 AM
Get Ready to wait in line – iPhone 7 due September.
August 18, 2016, 7:15 AM
Most Popular Articles
Smartphone Screen Protectors – What To Look For
September 21, 2016, 9:33 AM
UN Meeting to Tackle Antimicrobial Resistance
September 21, 2016, 9:52 AM
Walmart may get "Robot Shopping Carts?"
September 17, 2016, 6:01 AM
5 Cases for iPhone 7 and 7 iPhone Plus
September 18, 2016, 10:08 AM
Update: Problem-Free Galaxy Note7s CPSC Approved
September 22, 2016, 5:30 AM
Latest Blog Posts
Burlington Gun Attack
Sep 27, 2016, 5:00 AM
Who is in Risk of Getting Oral Cancer?
Sep 23, 2016, 6:02 AM
France Bans Plastic Eating Utensils in Restaurants
Sep 18, 2016, 10:49 AM
Progress Against Acute Myeloid Leukemia
Sep 17, 2016, 5:30 AM
Apple Watch Series 2 - Number 1 in the Customer Satisfaction.
Sep 7, 2016, 6:19 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information