Wall Street might be wrongly fixating on RIM's declining hardware business while ignoring its growing services business.
BGR is reporting that the reason for the delay in BB10 phones is not the chipset, but rather that the new platform is not ready.
Still others have reported on the big problem Research In Motion (RIMM) is having porting its secure messaging platform to the new BB10 OS (the whole BB network was designed for one PIN per user, and the prospect of having two devices for one user creates coordination and scalability challenges, and perhaps breaks the whole model).
This problem makes sense from an identity management perspective, although one would think that RIM could set up a replication system to sync contacts and calendars across PINs (have two PINs per user, and sync the shared data). However, if the company is indeed failing in its attempt to move its good tech to BB10 phones or the end result is well behind the competition, I would actually view this as a good thing. Here’s why:
What if the BB10 port fails?
Choice 1 is to move to another mobile OS – likely Android or Win8 (coming in the fall). Rather than fight the battle of mobile application ecosystems, just pick up one of the big three (or two…Win8 is a hopeful contender, and Apple (AAPL) doesn’t license). This is likely what the Microsoft (MSFT)/ Nokia (NOK) team was talking about in its rumored “flirtation” with RIM. (Nokia dropped its OS for Win7/8 last year).
Alternatively, Android adoption would allow RIM access to the Android application library, and once the company ports BB messaging to Android, it can sell it to all Android users.
If a deal like this was in the works but not yet completed, what would RIM management do? It would 1.) delay the planned release of BB10 and 2.) sell any existing inventory running on the new OS.
Wait…RIM did this already.
Choice 2 I already wrote about …RIM closes out its hardware/OS business and focuses on being an application (secure messaging) and mobile management platform. If that was its plan, management would still take the two actions outlined above, and maybe one more – increase marketing in an effort to make its hardware/OS business look as healthy as possible to a potential acquirer.
Wait…RIM announced it was doing exactly that last week.
As I have written, I believe the Street is looking in the wrong direction. It is fixated on RIM’s declining hardware business while ignoring its growing services business. I am hesitant to give much credit to RIM’s management (I hate being laughed at), but perhaps RIM is really just being sly like a fox.
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