The Future of RIMM

  • Posted: 16 December 2011 04:47 PM #136

    adamthompson3232 - 16 December 2011 04:04 PM

    RIMM’s market cap is currently $7B or so. Didn’t they pay over $1B as part of the Nortel patent purchase group? If so, boy did they f*** up big time on that one. Shows that even six months ago they had no clue how bad they really were and the cliff they were falling off. Management clearly has ZERO vision, at least not vision that sees reality.

    There was an article explaining why nobody can see disaster approaching when sales are still going up and RIMM was an example.
    Once sales fall of the cliff it’s a year or two to late. I wish i can find it .

         
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    Posted: 16 December 2011 04:54 PM #137

    mstefa - 16 December 2011 08:47 PM

    There was an article explaining why nobody can see disaster approaching when sales are still going up and RIMM was an example.  Once sales fall of the cliff it’s a year or two to late. I wish i can find it .

    This is a known fact.  Big boys are their eyes and ears on the supply chain and consumer trends.  Retail investors like us have to guess or read charts which should show what big boys are doing.

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  • Posted: 16 December 2011 05:03 PM #138

    mstefa - 16 December 2011 08:47 PM
    adamthompson3232 - 16 December 2011 04:04 PM

    RIMM’s market cap is currently $7B or so. Didn’t they pay over $1B as part of the Nortel patent purchase group? If so, boy did they f*** up big time on that one. Shows that even six months ago they had no clue how bad they really were and the cliff they were falling off. Management clearly has ZERO vision, at least not vision that sees reality.

    There was an article explaining why nobody can see disaster approaching when sales are still going up and RIMM was an example.
    Once sales fall of the cliff it’s a year or two to late. I wish i can find it .

    The rate of iPhone adoption in just the first 2 quarters should have been a 200 decibel clarion call to RIMM.  Whatever fear they felt, was relieved by cutting BB prices, which yielded a short term volume increase and higher gross revenue.  After that they can’t give away their 10 yo technology.

    But in the interests of being fair, one the iPhone launch, RIMM was 3 years behind already.  catching up to iOS and the iPhone in that period would have been extremely difficult.  That’s what happens when you milk the cow 6 years too long.

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  • Posted: 16 December 2011 05:06 PM #139

    adamthompson3232 - 16 December 2011 04:04 PM

    RIMM’s market cap is currently $7B or so. Didn’t they pay over $1B as part of the Nortel patent purchase group? If so, boy did they f*** up big time on that one. Shows that even six months ago they had no clue how bad they really were and the cliff they were falling off. Management clearly has ZERO vision, at least not vision that sees reality.

    RIMM is going through its cash faster than it can replace it.  I’m going to be watching for a cash raising sell off of those patents in the very near future.  When that happens RIMM is done.

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  • Posted: 16 December 2011 10:58 PM #140

    Okay…stand back, I’m going to throw a long bomb here and I know you’ll kick the sh*t out of me for it, but anyway, here goes…

    Yes, I live in Waterloo, and like most of us in this forum I’ve been able to see RIM’s demise coming ever since gauging their reaction to the iPhone as being completely wrong.

    BUT, perhaps Apple should buy RIM! There, I said it…

    Here’s why:
    - while decaying, RIM still has a great presence with business, taking over those relationships for iPhone sales would be a great opportunity. This corporate sales force is tight with so many large enterprises via very long term relationships
    - the device management software that RIM is coming out for Blackberry, iPhone, and Android would be a nice prize. I’d suggest they even cut the Android portion OUT. There are so many enterprises with the Blackberry that giving iPhone a big slice of this would be a huge advantage over Android. What a great opportunity to transition companies who want to move from Blackberry and need a smooth plan to the new while still keeping the old guard happy
    - RIM still has great worldwide distribution network
    - the cheap phones might be useful in the emerging markets as a foot in the door (though the product line would need to be ravaged)
    - the new division, Apple Business Mobile, would offer iPhone and a few remaining BlackBerry keyboard versions for the significant population of business and consumers who would never give up their keyboard
    - integration of BBM and iMessage would lead masses of young people to iPhone since they wouldn’t lose all their BBM buddies
    - the IP is worth billions, better get it before someone else gets does
    - RIM won’t sell any phones in the next few quarters as the Blackberry faithful wait for the QNX superphones phones in the 2nd half…RIM will be supercheap after sales of 697 phones are announced next quarter
    - it’s cheap and getting cheaper. Apple wouldn’t even miss the cash. In a couple of months it’ll only cost 5 billion or so (5% of the cash horde in a couple of months)
    - it’s a pipeline to graduates from the renowned University of Waterloo
    - RIM assortment of worldwide NOCs would be instant footprints for Apple to use and expand around the world for iCloud
    - other parts could be sold to offset the cost
    - given the market share of Android, I don’t think any regulatory would block it
    - they could offer Jim Balsillie and Mike Lazaridis jobs as chefs in the Apple campus, they could serve food on Playbooks. $1 a year for a chef is not bad.

    Any takers? Or have I had one too many tonight? Any other reasons to consider it?

         
  • Posted: 17 December 2011 05:58 AM #141

    Adam,  I’m not going to argue with the zero odds for a second,  but for the discussion, is there any sense in those ideas? Are we troubled by the thoughts that those remants of RIM going to someone else?

         
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    Posted: 17 December 2011 12:10 PM #142

    I too don’t think it would happen. My thoughts on why are:

    1) Apple doesn’t usually buy companies and run them as separate entities
    2) There would be concerns with buying out your competition
    3) There really isn’t much benefit to Apple in buying out RIM.
    4) The extra overhead would be difficult to integrate into Apple. They generally buy smaller companies and merge them into the larger company. RIM has quite a few employees already
    5) Having yet another couple of OS’ would not make things easier.

         
  • Posted: 17 December 2011 01:45 PM #143

    CdnPhoto - 17 December 2011 04:10 PM

    I too don’t think it would happen. My thoughts on why are:

    1) Apple doesn’t usually buy companies and run them as separate entities
    2) There would be concerns with buying out your competition
    3) There really isn’t much benefit to Apple in buying out RIM.
    4) The extra overhead would be difficult to integrate into Apple. They generally buy smaller companies and merge them into the larger company. RIM has quite a few employees already
    5) Having yet another couple of OS’ would not make things easier.

    I can’t argue that this seems like trying to mix oil and water and nothing that Apple would ever do. I’m just trying imagine if once someone else buys them, will it look like a lost opportunity given the rapidly falling price?

    What you’d really be buying would be
    - customers, relationships with enterprises, enterprise configuration mgmt
    - security capabilities and relationships with governments and the military who are hooked on that feature
    - you’d kill BB OS and QNX, create 1 Curve, 1 Bold, 1 Torch running “iOS Black” (iOS with security services layer) and keeping links to existing server infrastructures and giving the keyboard addicted a way to get a new device without jumping to a strange land.
    - capturing a lot of the consumers ready to leave RIM but who were otherwise going to end up with an Android device
    - a chunk of IP for the current patent wars

    I wouldn’t bet on this happening with your money, but could RIM ever get cheap enough that this would make sense?

    I assume at the price it would make sense for Apple to even consider it, someone else would have already scooped it up for more since almost anyone else would be less averse to chewing up RIM than Apple.

         
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    Posted: 17 December 2011 03:59 PM #144

    Considering the rate of adoption of the iPhone in the enterprise market, I’m not sure how much those relationships are truly worth. And except for those relationships, I’m not sure that there is much value for Apple. And with the tight integration between iOS/OSX, trying to incorporate a new device with a different OS makes little sense to the eco-system that Apple has created.  There may be some value in the patent portfolio that RIMM has, but that value is nebulous. Further it may be cheaper to license those patents than to actually purchase the company.

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  • Posted: 17 December 2011 04:39 PM #145

    CdnPhoto - 17 December 2011 04:10 PM

    I too don’t think it would happen. My thoughts on why are:

    1) Apple doesn’t usually buy companies and run them as separate entities
    2) There would be concerns with buying out your competition
    3) There really isn’t much benefit to Apple in buying out RIM.
    4) The extra overhead would be difficult to integrate into Apple. They generally buy smaller companies and merge them into the larger company. RIM has quite a few employees already
    5) Having yet another couple of OS’ would not make things easier.

    If I can add to the above.

    Not even the Nortel patents bring much to the, as RIMM only has a shared interest in them with the other members of the consortium (which includes Apple).

    It would be cheaper for Apple to develop an email/iPhone push/security program that did not rely on a centralized network.

    The BB succeeded because it improved email communications (productivity issue). The iPhone increases productivity on many more levels, without dependence on a proprietary network.

    Apple is going to get RIMM’s customers anyway, and isn’t interested in the cheap seats where there is still demand for low end BBs.

    Before retiring I owned a business that developed the first Linux based voice mail system (1998). Before choosing Linux we looked at QNX and felt that Linux 2.0 was more advanced.  Even then, it wasn’t until Linux 2.4 that we had a stable OS for our product.  Without widespread adoption I can’t imagine QNX having the resources to advance their OS much.

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    Posted: 20 December 2011 08:14 PM #146

    Amazon was interested in buying RIMM??

    As unlikely as it may sound, it seems that it occurred over the summer.

    In what could have been the saving grace for Research In Motion or the biggest mistake that Amazon has made to date, reports are swirling that Amazon considered buying the beleaguered mobile device maker.

    Yet, the reports also cite that RIM refused Amazon?s advances, which seems bizarre considering it isn?t a secret that the Canadian company is in the middle of some rough times and could use some serious cash and morale infusions.

    Reuters reports, based on information from anonymous sources ?with knowledge of the situation,? that RIM turned down the proposal because it would prefer ?to fix its problems on its own.?

      Amazon hired an investment bank this summer to review a potential merger with RIM, but it did not make a formal offer, said one of the sources. It is not clear whether informal discussions between Amazon and RIM ever led to specific price talk, or who else had approached RIM about a takeover.

    It almost sounds too ridiculous to be true. It?s already evident that RIM cannot fix its problems on its own as everything has pretty much gone sour before and since the launch of the BlackBerry PlayBook this year. (That?s at least within the U.S. market and on consumer levels. Look at the international and business scenes, and it?s a different story.)

    However, purchasing RIM would give Amazon an in-house mobile device manufacturer ? just like Google is doing with its proposed bid for Motorola Mobility. It?s not clear whether or not Amazon would turn over its Kindle products to RIM (which might end up getting ruined), but it has been reported that Amazon is keen on building a Kindle phone.

    Thus, this might be why Amazon wanted RIM in the first place, and it would be a bargain buy for the online retail giant considering RIM?s current state.

    Nevertheless, RIM seems set to fight its own battles completely alone.

    To me, it says one thing loud and clear.

    The management at RIM has lost complete sense of reality and are too stubborn to consider a rescue line.

    A once great Canadian company is now on a death watch.

         
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    Posted: 20 December 2011 08:15 PM #147

    It’s sad, and it also kinda sorta explains why the Kindle looks superficially similar to the PlayBook.

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    Posted: 20 December 2011 10:23 PM #148

    Interesting how RIMM shot up about 10% in AH on the news that it rejected a possible takeover. Do people even know how to read anymore?

         
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    Posted: 20 December 2011 10:39 PM #149

    Turns out it wasn’t just Amazon. Microsoft and Nokia thought about it too.

    What the hell would Amazon (NSDQ:AMZN - News) have done with Research in Motion? (NSDQ:RIMM - News) A report Tuesday indicated that Amazon considered making an offer for the struggling smartphone company and shed more light on how RIM?s board is thinking about extricating the company from its fine mess.

    It?s a little difficult at this point to understand why Amazon would have considered forking over several billion dollars for RIM, perhaps the most dysfunctional and toxic company in the mobile industry. But Reuters reported Tuesday that the company did just that, stopping short of putting together a formal offer but at least hiring an investment bank to kick the idea around.

    RIM has several assets: it has a ton of mobile patents, relationships with big companies, a secure e-mail network and a popular instant-messaging client. But it?s hard to see how those mesh with Amazon, and the company is having so much trouble with its core business?building compelling phones?that it?s a little difficult to understand why Amazon would want to swoop in: even if Amazon is really interested in building its own phone to complement the Kindle, RIM is not exactly the company one would call first.

    Updated: Someone on RIM?s board or among its bankers is in a talking mood: after the Reuters (NYSE:TRI - News) article surfaced, one appeared in the Wall Street Journal saying that a more traditional pair of suitors?Microsoft (NSDQ:MSFT - News) and Nokia?also gave consideration to making a bid for the company.

    The report, however, goes into more detail about the behind-the-scenes process at RIM over the last few turbulent months. Co-CEOs Jim Balsillie and Mike Lazardis are said to have received the full backing of RIM?s board?for some reason?in the quest to turn the company around, and it seems like RIM would rather try and make it happen on its own as opposed to selling out.

    The WSJ article suggested that Balsillie actually wants to wait until RIM launches the QNX-based BlackBerry devices that were delayed last week until the second half of next year before deciding whether or not it should sell the company.

    And in a line destined to further depress morale at the company, the board is said to think the problem with the company stems from the fact that it doesn?t have ?a deep bench.? In other words, RIM?s board just threw its upper management under the bus, and while changes may need to be made within those ranks as well, it?s hard to understand why they think Balsillie and Lazaridis can be entrusted with the turn-around project.

    As mentioned, RIMM is up 10%. Really, I have a lot of trouble understanding why it’s up. Yes, it had suitors, but they showed just how stubborn and blinded the co-CEOs are in their decision making. The board has also shown that their actions are so egregious that an SEC review should be undertaken.

    I’ve never had the guts to short, but I think this ‘bump’ might have done it for me. Thoughts? Buy a Jan 13 put call just out of the money?

         
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    Posted: 20 December 2011 10:58 PM #150

    Maybe Apple should get in line to buy or license RIMM’s IP at a bargain price.

    Sheesh, this is hard to watch.

    CdnPhoto, I’m getting this dangerous inclination to short RIMM myself.  But at this extreme price level, anything can happen.  Proceed with caution if you place any kind of bet on RIMM in _any_ direction.

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