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Research In Motion CEO Thorsten Heins. (DAVID MANNING/REUTERS)
Research In Motion CEO Thorsten Heins. (DAVID MANNING/REUTERS)

As RIM struggles, CEO Thorsten Heins reaches out to Canadians Add to ...

With little to offer investors but the prospect of months of bad news, Research In Motion Ltd.’s chief executive officer decided to reach out directly to the consumers he wants to buy BlackBerrys with a more positive message.

Thorsten Heins, who took over after Mike Lazaridis and Jim Balsillie stepped aside as RIM’s co-CEOs in late January, made an unprecedented attempt on Tuesday to reach a Canadian public that has grown increasingly skeptical of RIM’s chances of survival.

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Last week, RIM released some of its worst financial results, announcing 5,000 layoffs, dwindling sales, falling revenue, and a delay until next year of the company’s make-or-break BlackBerry 10 smartphone platform.

In an interview on CBC Radio’s Metro Morning show, and in an opinion piece for The Globe and Mail, Mr. Heins maintained RIM is not in a “death spiral” and is taking the “painful but necessary steps” in an arduous strategic transition.

Financial results over the next couple of fiscal quarters will likely be worse than last week’s results, given slowing sales. That means the company is left trying to keep its brand equity alive – giving people not just a sense of hope in the Canadian technology giant, but a reason to believe in and buy its BlackBerrys.

Likely, it is also aimed at bolstering employee morale as one-third of RIM’s global work force is sacked at a crucial time for the BlackBerry maker, which is trying to focus its remaining employees on BlackBerry 10.

In an e-mail, one long-time current employee said the delay of BlackBerry 10 left workers feeling betrayed by management, convinced that Apple and Samsung Electronics Co. had crushed both RIM and struggling Finnish cellphone manufacturer Nokia Corp., and that though they liked BlackBerry 10, they were uncertain how the devices would hold up in the marketplace.

In the opinion piece, Mr. Heins stressed RIM was seeing strong growth in emerging markets, was betting on new technologies such as so-called machine-to-machine telecommunications involving things such as parking meters, and was slimming the organization down to execute on these goals.

He acknowledged that RIM had enlisted two investment banks to help the executive team “think about the business in new ways and to explore a range of alternatives,” such as licensing its upcoming software platform to other smartphone manufacturers.

To some, the tone and language Mr. Heins employed on Tuesday was reminiscent of comments he made when he took over from Mr. Lazaridis and Mr. Balsillie – implying that RIM, despite obvious challenges, was doing fine, and would be okay in the end.

Others, reflecting a broader bearishness among an investment community that has largely written off RIM, were more cynical. “Whoever thought sending Thorsten Heins out to do PR damage control was a good thing, should be 1 of the 5,000 axed,” Eric Jackson, a financial commentator and founder of Ironfire Capital LLC, wrote on Twitter.

But with little else to offer the market any time soon – given RIM has no substantial new product beyond BlackBerry 10 next year, and perhaps an updated, 4G version of its unpopular PlayBook tablet – it makes sense for the company to try to change the tone in which it is discussed, said Kevin Restivo, an analyst with the global analytics firm IDC.

Mr. Restivo stressed that, though RIM likes to maintain that its failures and struggles in North America are in marked contrast to its success overseas, the global market is completely interconnected.

“The fact that (RIM’s) performing so poorly in North America directly impacts its brand,” Mr. Restivo said. “ The more powerful Apple and the collection of Android (hardware vendors) become in America and the Western world, the harder it will be for RIM to sustain their emerging market momentum.

“RIM has no choice but to try and counter the negativity.”

 
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