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Research In Motion to Drop most consumer markets
03/30/2012 : BLACKBERRY PARENT TO DROP CONSUMER MARKET
Research In Motion to concentrate on business markets in future.
Research In Motion, the company that pioneered the smartphone era with its ubiquitous Blackberry product, shocked the market late Thursday with its announcement that it is to cede most consumer markets, which have become intensely competitive, instead concentrating on a primarily business services model.
In a statement, Toronto-based RIM chief exec Thorsten Heins said a turnaround of the company's struggling business required "substantial change."
"We plan to refocus on the enterprise business and capitalize on our leading position in this segment," Heins said. "We believe that BlackBerry cannot succeed if we tried to be everybody's darling and all things to all people. Therefore, we plan to build on our strength."
RIM said former co-CEO Jim Balsillie has resigned from its board, and revealed that David Yach, chief technology officer for software, and Jim Rowan, chief operating officer for global operations, also are leaving in a management shakeup.
Industry observers have noted that whilst BlackBerrys are respected for their security and reliability as email devices, they haven't kept pace with iOS or Android phones when it comes to running third-party applications.
The RIM statement advised that the firm is exploring partnerships and other opportunities for its existing consumer business in order to focus on the corporate customers.
"We can't do everything ourselves, but we can do what we're good at," Heins said at a subsequent conference call following the release of the latest disappointing results by the company.
RIM turned in a net loss of $125 million in the quarter that ended March 3. This compares with a positive $934 million in the comparative period a year ago. The company revealed that revenue fell 25 percent to $4.2 billion from $5.6 billion.
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