Analysts doubtful RIM's leadership changes will stop the rot

Promotion of Thorsten Heins fails to inspire confidence in troubled BlackBerry maker

Analysts and industry commentators have cast doubt on whether Research In Motion's (RIM) leadership changes are enough to boost the firm's poor financials and reverse its declining reputation among businesses.

RIM's Jim Basillie and Mike Lazaridis resigned from their co-chief executive roles on Monday after investors put pressure on the company to shake things up.

The firm has seen its once strong market share eroded by Android and iPhone devices entering the business market. In December, RIM's third-quarter earnings for 2011 showed profits down 71 per cent on the previous year.

The resignations follow a bad 2011 for RIM, with its PlayBook tablet proving a flop and customers around the globe affected by a major network outage in October. The company also cut 2,000 jobs last year, the biggest lay-off in its history

IDC analyst Francisco Jeronimo told V3 that the promotion of chief operating officer Thorsten Heins to chief executive is unlikely to be enough to secure success for the firm.

"Of course it is good that the chief executives resigned as there was pressure on them from the market to do something," said Jeronimo.

"The doubt is whether an internal hire can make a difference. Heins is familiar with the company and knows what's going on but he can't bring in any new blood that RIM so badly needs."

Jeronimo said RIM should have been bolder, like Nokia was in September 2010 when it hired the president of Microsoft's business software group, Stephen Elop, as chief executive.

"Nokia was also suffering from poor performance so the firm took a bold move and hired someone from a different company and different region. Elop is now definitely working for them," said Jeronimo.

"Elop has really shaken things up and changed the mind-set of Nokia. People complained about him moving Nokia to Windows but Nokia's Lumia device is one of the best smartphones out there and Nokia's financial results are showing Elop is right on track."

Jeronimo said he expects RIM to maintain its current strategy under Heins, with the focus very much on new devices based on the QNX operating system. But will this be enough to lure users away from Android and iOS?

Analysts doubtful RIM's leadership changes will stop the rot

Promotion of Thorsten Heins fails to inspire confidence in troubled BlackBerry maker

"The problem is RIM is still not concentrating on improving the user experience like Apple and Google did by entering the apps market. RIM may improve email and instant messaging capabilities [with QNX] but smartphones are much more than this nowadays," he said.

"It can take me 10 minutes on a BlackBerry to update an application. This is one of the small details that matter to customers and RIM needs to work on this."

Meanwhile, the director at mergers and acquisitions firm Magister Advisors Victor Basta, said that RIM can no longer ignore the trend towards consumerisation in the workplace.

"RIM has always considered their customer to be the corporation, not the employee who works there," said Basta.

"Having taken the misguided view that they provide a corporate-mandated device, they are rapidly losing out to competitors who are rightly obsessed with the on-screen individual user experience."

Basta added that RIM also needs to lose its hardware focus.

"The brutal reality in this day and age is that businesses that are hardware-centric cannot succeed," he said.

"IBM is a very rare exception to the rule, but it took them a decade to transition from a hardware to a software focus. RIM does not have the luxury of a decade.

"It operates in the rapidly changing mobile space and there is far less time available."

Ernest Doku, a technology expert at the consumer comparison website uSwitch.com, added that RIM's decline is because its flagship products like BlackBerry Messenger have been overshadowed by competitors such as WhatsApp.

"The smartphone market is saturated, and the worry is that RIM is always one step behind the other big players," said Doku.

"Thorsten Heins' rescue package involves rallying RIM's troops to launch the next-generation BlackBerry 10 phones later this year. His focus on delivering the hardware is admirable, but this hasn't worked for RIM thus far."

Meanwhile, YouTube users appear to be even less enthusiastic about Heins' promotion than analysts.

"It's a sinking ship Thorston, time to catch a life raft," commented YouTube user Igeekone under a RIM video introduction to Heins.

"RIM, innovating too much? I didn't see any pigs flying in my backyard," added YouTube user Timmarrr234.

Whatever happens in the next 12 months, Heins clearly has his work cut out if he is to turn the firm around, and sway the doubters he is the right man to led RIM forward.