Research In Motion Limited (NASDAQ: RIMM) was supposed to win the moment is announced a change in the company’s top adult supervision. It should have been taken as very good news that co-CEOs Jim Balsillie and Mike Lazaridis are stepping down as co-chief executive officers. The problem we see is that COO Thorsten Heins will take over. This should have been good enough, but Mr. Heins sounded too much like the prior CEOs in denial that things are really that bad. They really are that bad and the stock has a loss of about 75% from its high over the last year to prove it. Heins even said that he would rely on both former CEOs for advice and guidance in his conference call and he is pressing the opinion that R-I-M is not a turnaround.
RIM is very much a turnaround and the situation is far more dire than what the company is telegraphing. It may still be making money, but its market share and its relevance are both under fire. Google Inc. (NASDAQ: GOOG) and Apple Inc. (NASDAQ: AAPL) have managed in the last two years to make the Blackberry (or even the Crackberry) image to be one of yesteryear. 2010 was the year that the defections began in smartphones for consumers in a significant way, but 2011 was really the first year that corporations and enterprises have started to allow their representatives to use Apple and/or Android smartphones.
Whether or not Thorsten Heins is truly a bad choice for the CEO replacement remains to be proved. If he sticks by his comments and his attitude of the first day when he still has to be and wants to be friendly to Jim Balsillie and Mike Lazaridis then he is going to face a lot of pushback and criticism from investors. RIM shares are now down 6.6% at $15.86 against a 52-week range of $12.45 to $70.54. Common sense would have signaled that RIMM might be up over 6% rather than down over 6% on this news.
JON C. OGG
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