
Two once-powerful tech companies took strong steps toward their comeback efforts, with Research In Motion replacing its co-CEOs and Nokia beginning its push of a new Windows phone.
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RIM Needs "Seismic Changes"
The Setup: RIM just couldn't catch a break last year. It started out on top, thanks to the BlackBerries everybody from politicians to movie stars couldn't put down. However, smartphones like the iPhone and all those Android phones moved ahead, and RIM kept postponing product releases and eventually got left behind.
It still offers the most-secure messaging and e-mail services of any provider, but that's little help when there are service outages among the people who just can't afford to be offline for even a minute.
When there's a downward spiral, everything gets caught in the vortex, and that's what happened with RIM last year. But think of it like a tornado -- it gets out of control and builds up speed, but when the weather pattern breaks, the cloud goes away and there are blue skies not long after.
However, RIM doesn't seem to be quite ready to break its pattern.
RIM's CEOs Mike Lazaridis and Jim Balsillie stepped down, which is code speak for when a company tells top officials "see you later, don't let the door hit you on the ass on your way out." After a year of missteps, including their refusal to split their jobs despite stockholders' demands, it's probably too early to say if they're being missed yet. But somehow, we don't think RIM bought them a good-bye cake. RIM: 1,000 points.
Thorsten Heins moved up from his job as chief operations officer to take the former CEOs' jobs. He's been with RIM since 2007, so he was there during its good times as well as its bad, knowing the business well and working with software, hardware and sales. RIM: 500 points.
Heins, recognizing RIM has had a lot of problems with marketing in the past year, is already searching for a new chief marketing officer, who will have the huge task of rebuilding the company's profile, which is heavily battered at this point. RIM: 200 points.
That marketing officer might want to get together with the PR department, though, after Heins' next statement -- because he doesn't plan any "seismic changes" to RIM's overall strategy. This came on a day when shareholders might not want an earthquake, but maybe do want a tremor to shake things up a bit. RIM: -500 points.
Heins, though, is considering licensing BlackBerry 10 to other interested manufacturers, boosting RIM as a software maker based on its security and communication credentials. RIM: 200 points.
He won't be splitting up the company though, which should reassure stockholders who bought their shares two years ago when RIM was on top but would lose a great deal of money if the company is divided. RIM: 100 points.
RIM's U.S. market share dipped to less than 10 percent in 2011 due to its disappointing PlayBook tablet and lack of innovative new hardware. Further, the company didn't develop new products for most of 2011, allowing Apple to bypass it with both the iPhone 4S and the iPad 2 and turning RIM into a dinosaur. RIM: -2,000 points.
Heins' openness to make the BlackBerry OS available to other phone makers may intrigue the industry, but WebOS couldn't compete against Apple and Google, and Windows Phone is pushing ahead for 2012. Will anyone even want the BlackBerry OS? RIM: -500 points.The Score: RIM: -1,000 points.What it means: RIM took the right step by showing Balsillie and Lazaridis the door. While they were effective top executives in the past, the technology market passed RIM by, and they didn't take the steps needed to keep the company modern and solvent.
True, some of RIM's misfortunes, such as servers that quit working, probably would have happened with or without them, but CEOs who can't push technology forward these days likely will find themselves in the unemployment line.
It's understandable, though, that Heins is taking a conservative approach to turning RIM around. After all, it would be irresponsible for him to take the job and start reinventing the company before Balsillie's and Lazaridis' butt prints were out of their office chairs.
In the upcoming year, though, Heins may have to rethink his reluctance to make "seismic changes" for RIM. This is a company that needs some big changes, including smartphones that combine the company's still top-line security with technology that will entice an increasingly tech-savvy buying public.
Without a line of new devices, RIM could go the way of Palm and become one of those companies that was pretty good at one time, but just couldn't keep up -- and Heins could find himself having to give up his keys to the CEO bathroom as well.
Nokia Pins Hopes on Lumia
The Setup: Nokia, like RIM, at one time had the phones everyone wanted. However, the Finland-based company, also like RIM, stuck with the phones that put it on top instead of moving ahead to the future, and got left behind. True, Nokia sells a lot of its feature phones around the world. After all, not everyone wants -- or can afford -- a smartphone.
However, in a world where even the little children are clicking merrily away on their iPhones, phones that don't have a touchscreen just aren't as cool anymore -- and neither was Nokia.
That might be changing this year with one little device -- the Windows-powered Lumia line.
Nokia shipped more than one million Lumia handsets last year, analysts estimate, signaling early success for the company's critical Microsoft partnership. RIM: 1,500 points.
The Lumia 800 went on sale in Europe in mid-November, while the Lumia 710 launched in four Asian markets and Russia in December. The 800 got off to a strong start in the U.K., selling out in many locations and leaving Nokia scrambling to meet customer demand for it -- and that's not a bad problem to have. Nokia: 1,000 points.
Analysts project Nokia could nab third place in the global smartphone market if its Windows gamble pays off, with Lumia sales could top three million this quarter. Nokia: 500 points.
AT&T readies for launch of the Lumia 900 later this quarter, and to top it off, it's selling the new phone for $100, an unheard-of price for a top-of-the-line new smartphone. True, the Lumia will likely take some time to catch public attention. But it's Nokia's first LTE Windows phone and a Consumer Electronics Show award-winner, and it's already attracting attention. After all, there are always people who want to try the latest thing -- and the Lumia might just be it. Nokia: 2,000 points.The Score: Nokia: 5,000 points.
What it means: Nokia hasn't lost its place as the top phone seller by volume because a lot of the world still uses feature phones, but it's not making the money it once did because it's not competing with smartphones.
Nokia, though, is clawing its way back up with a well-planned device, not by playing around with its marketing department or trying not to shake things up. It plans to move full-speed ahead with a high-end, full-featured smartphone that could capture the attention of a buying public that wants another option. The Lumia is different enough to attract attention, and is a 4G LTE model, making it ready for the LTE expansions sweeping North America's carriers.
The Lumia likely won't beat out the iPhone or high-end Android smartphones, but it could come in at a respectable third place and plenty of them will likely be sold.
In today's market, it's all about the product -- and Nokia is banking on its Lumia phone to turn the tide. Perhaps RIM should give Nokia a call and get some good advice about what it will really need this year.
The Score: RIM, Nokia Offer a Tale of Two Comebacks originally appeared at Mobiledia on Fri Jan 27, 2012 1:58 pm.