Report claims RIM's Balsillie and Lazaridis to be ousted as chairmen

2011 was a year that customers, employees and directors of Research In Motion would undoubtedly like to forget. It stands as a textbook example of how not to run a multinational corporation: the weak launch of the half-finished PlayBook; the four-day global service outage, which unfortunately ended the day before the launch of the iPhone 4S; the decision to launch high-end products based on its ageing BlackBerry 7 OS rather than address the continued delays to its next-generation BlackBerry 10 devices… you get the idea.

It’s not difficult to understand why RIM’s shares lost almost 80% of their value last year, and why the company’s share value is now less than the value of its assets.

Jim Balsillie and Mike Lazaridis. Image via Radio Canada.

RIM’s co-chairmen, Jim Balsillie and Mike Lazaridis, have presided over the unmitigated disaster, seemingly oblivious to the extent of their failure to lead the company back on the path to success. That lack of leadership has not gone unnoticed by RIM’s board of directors, it seems; the Financial Post reports that the two men at the top will soon be ousted as co-chairmen, with a new single chairperson replacing them.

Quoting ‘sources familiar with events’, the FP claims that RIM’s management structure has been under scrutiny by seven independent directors, including Barbara Stymiest, who is believed to be the current favourite to replace Balsillie and Lazaridis. RIM consented to assess its management and governance roles last summer, in response to shareholder concerns.

Nothing is yet set in stone; the proposal will be made in a report that will be delivered to the company’s board at the end of the month. Despite being stripped of their co-chairmanships, any proposal is likely to maintain Balsillie and Lazaridis as co-CEOs. At time of writing, RIM’s shares are up 8% in response to the rumoured changes.

Despite this encouraging news, RIM’s new year hasn’t exactly got off to the best of starts. Faced with the continuing reality that no-one wants to buy PlayBooks for up to $700 a go, the company has resorted to another fire sale that has seen its entire range of tablets selling for $299 a go. The much anticipated update to the PlayBook – expected to bring native email support to the device, at long last – is still weeks away from being made available… assuming that RIM doesn’t delay it, yet again.  

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I think they should definately go Android route... I mean they are already slowly heading that way now.

PlayBook owners willing to root their devices now have access to the Android Market as well as the apps contained within.

While an upcoming PlayBook software update will soon bring official Android app support to the tablet, apps will need to be repackaged and made available in BlackBerry App World in order to function in RIM's app player.

I don't feel sorry for them. Palm was able to design a great operating system (just not great hardware) and for a company with significantly less capital than RIM had. As a Blackberry user (company phone) OS 7 doesn't feel any different from OS 6, it may be a new OS but it was already years behind everyone when it launched. The playbook was released in April and it still doesn't even have an email client. Of all the people I know with Blackberries I don't know anyone whose next phone will be a Blackberry. I like the idea of BBX or BB10, but they'll be far too late to the market by the time they expect to launch.

Does anyone want to argue that RIM has been making the right decisions for the last five years? They need to go.

RIM is done. This is a hail mary that wont work. Like MS of late, they waited to long to get into the game and will have to settle to just surviving. The difference is MS can afford to with WP7. RIM cant. The pecking order will shake out with iPhone, Android, WP7 and RIM in that order.

Frank2029 said,
Aging OS7? Its a fairly new OS n00b.

As mightymightyme pointed out below, OS 7 may be new on paper, but it feels every bit as creaky and unremarkable as its predecessor.

Much the same trick that Microsoft pulled with Windows Mobile for many years - Windows Mobile 6.5 may have been the most modern iteration at the end, but scratch beneath the glossy surface, and it wasn't difficult to see the roots of the OS going back to the Pocket PC days.

You can list OS 7's new features and point out the fairy dust here and there, but it's almost a textbook example of lipstick on a pig, or the proverbial polished turd.

"Report claims RIM's Balsillie and Lazaridis to be ousted as chairmen"

The headline is wrong. Correction:

"Report claims RIM's Balsillie and Lazaridis to be ice-hockeyed out of RIM"

I personally feel bad for these guys .. everyone is hating on them but you have to look at their situation.. They are a Cellphone and server company that relies almost exclusively on their Blackberry Phones.. So many other companies have gone the same route as RIM with cellphones but they had other products to rely on while they switch to their new phone OS's

Microsoft went from being a Leader to almost 4 percent now in the cellphone market with a ton of extra cash to throw at the problem over the last few years..

HP/Palm just failed at their cellphone business but they can sit back and rely on their other products to regain losses while they switch to windows phone..

Nokia did a horrible job at coming out with an iphone competitor and are now finally catching up as they switch to windows phone... They are relying on a their brand recongnition outside of the US to fund one final time to actually try to sell well in the US.

It must be pretty rough competing against a company with a Market cap in the hundreds of billions while your company has only a few billion in cash.. I think RIM did a way better job then HP did in the last while... Even Nokia messed up a bit by switching to Windows phone to hard and left all their customers in the dust.. RIM is pretty much in the same position as Microsoft from 6.5 to 7 and no one thought they could pull it off.. At least RIM started working on their new OS earlier then Microsoft/HP and countless others.. They still have like 20 percent of ALL the smartphones in the US and make billions in profit..

It must really suck when your main competitor (apple) could just buy you and destroy the company with a few tens of billions of dollars to spare... (which they easily would of but the Canadian government would most likely block it)

Atleast they have a backup plan of switching over to Windows Phone if their new OS fails completely which is something that HP never even tried and decided to just quit..

I don't feel bad for them at all or the company. Blackberry used to be the king of smartphones in the enterprise. The problem with that is a lot of companies fall into that same trap. We are #1 so we don't have to change. RIMs biggest mistakes were:

a) When the first iPhone came out, they should have started developing an OS that can compete. After all, Apple started the smartphone phenomena. Not until the iPhone came out did I ever see teenagers carrying around a smartphone.

b) The development of the Blackberry Storm was a wasted effort. It was not reviewed very highly yet RIM went out to make a second iteration of that device. Inevitably that product line failed.

c) When Android's market share started to rise, that should have been the second wake up call for this company. However, they kept on with their same devices and slow OS. When Android became number 1 in the market share at this time last year, the company should have looked into developing Android phones on the OS with Blackberry Services. This would have held their market share from going to a rapid decline through out 2011.

d) The release of Windows Phone 7 is another good example. Here is a company [Microsoft] that was in the mobile OS business in the past that tried, was briefly successful and eventually failed on their first attempt (Windows Mobile). However, Microsoft saw what the market was like at this point and revamped their mobile OS from the ground up. It may not be successful but it is a change.

e) Nokia bowing out from designing their own mobile OS was another great opportunity for RIM to take back a few market shares. However, because they didn't plan ahead, there was a as mass exodus from their platform in 2011.

The bottom line is, RIM can not pull a Nokia and go exclusively with Windows Phone because their would be nothing to differentiate them from any other Windows Phone in the market. RIM can not make an iOS phone since that is a complete ecosystem that Apple only designs. The only smart strategy they had a year ago was to go with Android. They didn't even have to go exclusively Android but it would have been better for them to still maintain a customer base as the redesigned the Blackberry software. If the Blackberry OS failed in time, at least they had a foot in the door and would still be in the Mobile OS business. Inevitibly I see one of two thing happening this year:

a) The company fails completely
b) They go exclusively with Android offering Blackberry Services (i.e. Messenger, E-Mail, etc...).

At this point the Blackberry name is getting tarnished and probably won't survive another year as an OS. If their value gets any lower, Google should just buy them and hopefully take hold of the enterprise market. Time will tell what will happen with this company but I feel we won't have to wait longer than 2012 .

Im not saying they did an awesome job but they have done better then the competition.. people diss them hard really hard right now but really they beat out palm/microsoft/nokia and only lost a chunk to the iphone and more recently android.. If you look at their competition, such as palm and microsoft, they lost marketshare wayyyy faster whereas RIM has held on to it.. if they are around 10-15 percent by the time the new OS comes out then that will be better then everyone else in their market..

I look forward to how Apple will fare when they reach iOS 8 and people start talking about how it looks super aged and they need to start making drastic changes to their OS.. it already looks ancient to me (im a WP7 user)..

Apple was not that innovative in my opinion with the iphone... when i got my first ipod (one of the ones with a circle on the front) I wrote in suggesting they just make it into a phone.. and they did about 3 years later..

Lachlan said,
Apple was not that innovative in my opinion with the iphone... when i got my first ipod (one of the ones with a circle on the front) I wrote in suggesting they just make it into a phone.. and they did about 3 years later..

I'm confused. Are you saying Apple is not innovative because you came up with the idea for the iPhone first or because it was a lame idea because you came up with it?

As much as I dislike Apple, the company is certainly innovative. They are innovative enough to bring things to the market first in a useable manner. Sure smartphones and tablets existed before Apple brought out the iPhone and iPad but Apple was the first to make it a product that a lot of people want to buy. Even sell it to people that have no need for that product. Apple definitely started the smartphone phenomena. There is no reason why teenagers should be walking around with a smartphone. Yet when the iPhone first came out, a lot of kids started walking around with them (even Blackberrys at the time because their parents were probably not on the AT&T network. I'm just speculating of course.)

I would agree with you that they are not innovative with maintaining their product line. iOS looks just about the same from its first iteration with the original iPhone. Not much has changed in it's appearance. It is the same with the Blackberry OS. But when you take a look at the evolution of Windows Mobile to Windows Phone or Android 1.0 to 4.0, you see a different OS.

Apple is falling into the trap that Blackberry got themselves in. Yes I also agree with you with how people will react to iOS 8 even 7 or 6 when it is released.

Edited by UndergroundWire, Jan 4 2012, 12:14pm :