RIM considering splitting its smartphone and services businesses
According to a recent report by the Sunday Times, Research In Motion (RIM) is looking to separate its manufacturing and services businesses, effectively splitting the company into two, in an effort to cope with its continued difficulties in the extremely competitive smartphone market.
As a strategic option, the move would allow RIM concentrate on its more profitable services business (BBM, BIS, etc.), with its ailing smartphone business not pulling it down. The Canadian mobile giant would then also be able to sell the separately listed smartphone business.
RIM recently asked financial consultants, JP Morgan and RBC Capital, to help it come up with solutions to its current woes, and the rumoured split seems to be a result of those advisements. The report also suggests that Amazon and Facebook are probable potential buyers of the smartphone division, with both companies looking to get into the mobile game for a while.
We’ve seen RIM trying to market BBM as a standalone tool for a couple of years now, and the proposed move remains in line with that motive, as after the split of businesses, the company could very well offer its BBM and BIS services to smartphone platform rivals, like Apple and Google, and their respective mobile devices. A BlackBerry Messenger for Android was spotted online late last year, but never materialized.
The Canadian company recently released a multi-platform device management tool, called BlackBerry Mobile Fusion, offering enterprises the ability to manage a broad spectrum of devices, along with RIM’s legendary security. The tool is another indication of RIM’s current aims to not place all its eggs into a single basket, and instead begin capitalizing on its services division.
Ever since RIM began struggling in the face of smartphone competition from the likes of the Apple iPhone and Android-based devices, there have been rumours of the company looking to sell out. Last year, private equity firms were in negotiations, and a consortium backed by Microsoft was one of the potential buyers. Nothing materialized out of those talks however, but we could very well see something happen soon, with Microsoft probably still interested, if only in a better deal.
What do you think BlackBerry-maker Research In Motion should do to turnaround its slow decline? Do you think splitting and selling divisions is a good idea, or can the company recover intact? Do let us know in the comments section below. In the meantime, do check out our Five Point Survival Guide for RIM in 2012.
Source: Reuters