What makes Apple so successful is that it isn’t afraid to take risks in the name of innovation. Giving more credence to consumers thinking of selling BlackBerrys and other smartphones in exchange for the iPhone, Apple has been sitting comfortably on the smartphone throne ever since its entrance into the market half a decade ago.
Research In Motion, on the other hand, has been in a continuous slump after having been king of the hill for so long. The company rested on its laurels while it was at the top, and only made great strides towards a bid for relevance when it was already too late.
Now, RIM is reduced to considering split-and-merger options to just try and stay afloat, prompting even the most stalwart Berry aficionado to finally give in, sell old BlackBerrys and switch to something better. This company-splitting move has actually been on the backburner for over a month now, when RIM hired bankers JP Morgan and RBC to help them evaluate alternatives. It was only after Apple’s presentation of the revolutionary iOS 6 at the recently concluded World Wide Developers Convention 2012, however, that this merger option became an imperative.
Research In Motion’s primary option is in selling shares of its handset division; and probably auctioning it off entirely if it comes to that. The two frontrunners for this merger deal are Amazon and Facebook; and though both could stand to get good business out of the merger, there are also impediments which could make both companies think twice.
Amazon wishes to follow up its Kindle Fire tablet with a smartphone release, and acquiring RIM’s handset division could give it the resources it needs. What’s noteworthy about the company’s intentions for the division, however, is that it doesn’t necessarily want to sell BlackBerry handsets (or whatever it is the company want to call the phones) at a markup. Instead, it is looking to make the division a channel for its mobile commerce venture. With years of accrued details of online customer tendencies analytics, as well as a bevy of online customer contacts, this endeavor could be very viable for Amazon indeed. The only problem is they already have something like this set up with Android, and setting another one up on a vastly different OS (the BB 10 is based on the QNX platform), might just prove to be more trouble than it’s worth.
Facebook, on the other hand, is actually looking to expand its business into the smartphone market, and acquiring BlackBerry could instantly make it a major player. While this is all well and good, Facebook is facing (no pun intended) its own financial woes at the moment, though nothing as dire as RIM’s. Nevertheless, it still renders the merger deal a secondary priority.
Whether Research In Motion sells to Amazon, Facebook, or another company or goes with a different plan entirely, the point is that they have to do something drastic soon. Pundits are expecting that RIM could see its total demise by 2013, and the company has to pull out all the stops to prevent that from happening.