For RIM, Moment of Truth Is Almost at Hand

RIM is betting big that BlackBerry 10 can compete on equal terms with Google Android and Apple’s iOS.

For embattled BlackBerry maker Research In Motion, the moment of truth is nearly at hand.

Over the past several quarters, the company has watched its rivals—including Apple’s iPhone and a plethora of Google Android devices—eat away at its share of the mobile-device market. Even government agencies and large businesses have abandoned the once-ubiquitous BlackBerry in favor of other hardware, often employees’ personal devices configured to run on an office network. RIM’s foray into the tablet market, the PlayBook, failed to challenge the iPad in a meaningful way.

For its most recent quarter ended Dec. 1, RIM reported revenues of $2.7 billion, down 47 percent from the same quarter last year. Its cash reserves increased to $2.9 billion. While it shipped 6.9 million BlackBerry smartphones and roughly 255,000 PlayBook tablets, company executives also announced a decline in the BlackBerry subscriber base, as well a change in how it bills for BlackBerry services.

On the positive side, RIM and Nokia announced a settlement to their patent litigation, which will involve both a one-time payment and ongoing payments on RIM’s part. That long-running battle deals with intellectual property related to WLAN.

So this is RIM at the end of 2012: losing subscribers and revenue, facing significant opponents, but with more cash on hand and at least one long-running lawsuit settled. If nothing else, it means the way is clear for RIM to launch its Hail Mary pass: BlackBerry 10.

While RIM managed to keep the first BlackBerry 10 smartphone largely under wraps, some details—both official and unofficial—have emerged. For example, recently posted an image of some purported marketing material for the upcoming device; if that imagery is accurate, the “BlackBerry Z10” includes a full touch-screen and a sleek, button-free body. RIM also posted an image on its own Website of the device’s back, covered in what looks like pebbled leather or plastic.

The BlackBerry 10 operating system, meanwhile, is a total revamp of the traditional BlackBerry software. Whereas the old BlackBerry interface offered grids of icons linked to applications, BlackBerry 10 includes a home-screen of live tiles with dynamically updated information; users can swipe to move between apps, peek at notifications by “flicking” the screen from the bottom, and filter email and social accounts through a Hub.

It’s all very slick, but will it succeed? RIM basically has no choice. As research firm IDC noted in a November note, failure to capture the attention of audiences and thirty-party app developers will pretty much mean the beginning of RIM’s demise.


Image: RIM