RIM's new CEO cites consumer market, operational discipline
— -- BlackBerry wants to shed its for-business-only reputation.
In naming a new CEO insistent on discipline, BlackBerry maker Research In Motion (RIM) is hitting a reset button on the company, which has missed new product deadlines and sales targets even as its smartphone competitors lured away customers with more user-friendly devices.
Thorsten Heins, the former chief operating officer of the Canadian company, wants to aim more products squarely at the casual consumer and improve RIM's marketing.
Heins, recruited four years ago when RIM and its BlackBerry were booming, takes the helm as the company struggles with declining sales and the fast-changing mobile landscape that's placing more emphasis on third-party content. He replaces co-CEOs Mike Lazaridis and Jim Balsillie, who stepped down Sunday.
RIM will not undergo a "drastic change," says Heins, a German national who spent much of his career at Siemens. But he says the company needs discipline in order "to get better."
Heins hinted at RIM's tendency to develop products on the fly. Under his watch, RIM will improve its planning, allocation of resources and scheduling projects. "You'll see us executing better," he says.
Executives are spread around several buildings on its Waterloo, Ontario, campus, says Kevin Michaluk, founder of Crackberry.com, a popular BlackBerry user forum. "Deadlines tend to be missed and bucks get passed," he says. Having one CEO will help clarify assignments and structure, he adds.
BlackBerry, an early leader in the emerging mobile data market, rose to prominence on its reputation as a maker of secure phones for corporate e-mail. But its position in the market was rocked in 2007 by the emergence of Apple's iPhone and other smartphone manufacturers using Google's Android operating system, a dizzying series of changes from which it has never recovered.
BlackBerrys had only 11.1% of the smartphone market worldwide in 2011, says technology research firm IDC. Android captured 49%, while Apple's iOS operating system had 18.2%. In its most recent quarter, RIM's sales fell to $5.2 billion, off 6% from a year earlier. And its stock has fallen 75% in the last 12 months.
BlackBerry has had some success in the casual consumer market with its Pearl and Curve smartphone models. But it failed to seize the momentum, Michaluk says.
RIM has diversified in recent months, launching a tablet computer called Playbook that can play Android apps. Despite the original model's lackluster sales, Playbook 2 will hit the market next month.
Last year, RIM also bought QNX, an operating system that it is redesigning and relaunching later this year under the name "BlackBerry 10." It will be the operating system for a new line of smartphones and tablets. But with Microsoft also introducing its well-received Windows Phone 7, analysts wonder if the market has room for yet another mobile operating system.
Michaluk says RIM has to play catch-up by offering more apps and adding a music store, comparable to Apple's iTunes. RIM also must persuade developers to create other apps for its operating system. "Once you close the app gap, it's about hardware. RIM has shown that they can build great hardware," he says.
Heins, however, will have to pull off his strategy while preserving sales from RIM's enterprise business, says John Jackson of technology research firm CCS Insight. "RIM's competition will be more Microsoft, Apple, Amazon and Facebook, and less likely Nokia and LG. For RIM, it is a question of limits of investors' patience."
Popular Reads
ABC News Live