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Research In Motion Has a Yard Sale to Raise Cash


RIM will be selling a corporate jet to cut costs, according to reports that came out just ahead of the company's investor conference.

MINYANVILLE ORIGINAL Today, Research In Motion (RIMM) shareholders are gathering in Waterloo for the struggling BlackBerry maker's investor conference.

This is CEO Thorsten Heins' first shareholder meeting. In the company's last fiscal quarter, it posted a net loss of $518 million. The company simultaneously announced that about a third of its workforce will be laid off and that the BlackBerry 10 operating system will be delayed until the beginning of 2013.

"The benefits will take time to have a meaningful impact on our performance," Heins said at the meeting today. "As I've said, we do expect the next several quarters to be challenging … as we go through the transition to BlackBerry 10."

Heins pointed to RIM's success in Africa, the Middle East, and Southeast Asia with BlackBerry 7 phones. Management hopes that this revenue will support the company until the incipient BlackBerry 10 has a "full portfolio" of models. The latter OS will come as a full touchscreen device, more like the Apple (AAPL) iPhones and various Google (GOOG) Android devices that are eating into RIM's market share, and another model with RIM's beloved tactile keyboard. The next generation of the BlackBerry Messenger will include new upgrades such as video chat.

Shareholders voted to re-elect the board of directors, but the vote was "not an overwhelming approval" of the company's corporate governance.

"I am not satisfied with the performance of the company over the past year," Heins said. "Many of you are frustrated with the time it has taken us to make our way through the transition."

Today's meeting was certainly a contentious one. Shareholders are very frustrated by the company's lack of action and willingness to accept that the smartphone market has changed, which many blame for the 95% slide in the stock price since its 2008 peak.

If that doesn't suck enough of the auspice out of the meeting today, Bloomberg reported today that RIM will be selling one of its two corporate jets to raise cash and help meet the goal of shaving $1 billion off of the company's operating expenses. If you are in the market for a nine-passenger Dassault Aviation SA (DSY) F50EX, you can buy one from RIM for $6 million - $7 million, according to Bloomberg's sources.

These charts below, compiled by Asymco's Horace Dediu,show the sharp fall in market share for both RIM and Nokia (NOK) as well as the iPhone and Samsung's (SSNLF) offerings.

Even as the global market for smartphones grew, RIM's sales shrank, and its share of the smartphone pie shrank even faster.

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Even if RIM were to produce a truly incredible device for BlackBerry 10, it will certainly not be as profitable as the highly marked-up iPhone is for Apple. Nokia has a similar problem. Without Apple's solid Asian supply chain, the Lumia 900 smartphone costs about as much as an iPhone, but sells for less.

Twitter: @vincent_trivett
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