09_research in motion

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Research in Motion

Jenice joy sumaway

Genilyn gaan

September 24, 2011



Situation Analysis



IndustryIndustry

11% in global wireless market (3B in 2007)

Market Segments: Personal use, Prosumer andEnterprise

Japan and Korea – non-business 30% messaging; 70%MMS, browser traffic and infotainment

Europe – business 70%-80% messaging; 20%-30%others

Introduction of Smartphones in 2000Manufacturers focus on both software & hardwarecapabilities



CompetitorCompetitor

NOKIA

39% market share

174 million smartphones sold in 2009

launched free satellite navigation to boost smartphone sales

APPLE

14% market sharebecame a consumer phenomenon and led the mobile industry to

shift focus on software and applications

Expanding into new markets such as China

HTC

Plans to introduce lower-priced models to target developingmarkets such as China

Manufactures Google's own-brand Nexus One smartphone

SAMSUNG

3% market share

aims to at least treble its smartphone volume this year and plans

to offer phones running on Android, Windows Mobile and Linux

http://www.reuters.com/places/china

http://www.reuters.com/finance/markets

http://www.reuters.com/finance/markets

http://www.reuters.com/places/china



CompetitorCompetitor

SONY ERICSSON

Japanese-Swedish venture has struggled to build position in the

smartphone market, with Windows-phone X1

Symbian, Android and Windows

LG ELECTRONICS

World's No.3 mobile maker

It has an ambitious target to achieve a double-digit share of the

global smartphone market by 2012.

Source: www.reuters.com

http://www.reuters.com/

http://www.reuters.com/



Worldwide Market for PDA andWorldwide Market for PDA and

SmartphonesSmartphones

0

50

100

150

200

2000 2003 2004 2005 2006 2007 2008

Worlwide Market Sales

PDA Sales Smartphone Sales

020

40

60

80

100

2004 2005 2006

Worldwide PDA Market Share

Research in Motion Palm Hewlett-Packard Nokia T-Mobile Others

Source: Smarthones to outsell PDAs by 5:1

eT Forecasts, March 28, 2006

When Smartphones were introduced in

the market there’s significant sales

growth of 528%, 48%, 65%, 42% and 6%

respectively.

RIM market share increases 23% from ‘04

to ‘05 grabbing from Palm & HP. But -7%

decreases from ‘05 to ’06, maybe Nokia

and others increase market share.

Source: Gartner Dataquest

Feb 14, 2006; Oct 9, 2006



Market OverviewMarket Overview

0

500

1000

1500

2000

2500

2005 2006 2007 2008

Market Demand vs Replacement Units

Market demand Replacement units

0500

1000

1500

2000

2500

3000

3500

2005 2006 2007 2008

Global Subscriptions

Current Subscriptions Net New Subscriptions

Market demand and replacement units

were increasing from 2005 to 2008

Current subscription were increasing, but

there’s a slow growth in new

subscriptions

Source: M. Hoffman and J. Baxter “Wireless Equipment – Mobile Phone Industry Still Seeking Balance,” Cowan & Company,

April 13, 2007



Handset Sales Growth by RegionHandset Sales Growth by Region

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

North America Latin America Western

Europe

EMEA Asia Pacific Total Unit

Sell-in

11% 11%

14%15%

42%

22%

9%

15%

4%

27%

11%13%

-7%

6%4%

11%

6% 5%

2006 2007 2008

There’s 22% increase in handset sales from ‘05 to ’06, AP and EMEA

contributes to biggest growth in ‘06. But sales growth drop to 13% and 5%,in 2007 and 2008 respectively.



Organization



The CompanyThe Company

Fast FactsFast Facts

Founded in 1984

Headquarters in Waterloo, Ontario, Canada

Offices in North America, Asia-Pacific andEurope

Launched the BlackBerry smartphone in 1999

Led by Co-CEO Jim Balsillie and President andCo-CEO Mike Lazaridis

Young image and culture



RIM ExecutivesRIM Executives

Since 1992, Jim Balsillie has been co-CEO at Research In

Motion (RIM), maker of the world renowned BlackBerry

wireless solution. At RIM, Jim is responsible for driving

corporate strategy, business development, marketing,

sales, and finance.

As President and Co-CEO of Research In Motion (RIM), acompany Mr. Lazaridis founded while a student at UW, he is

responsible for product strategy, research anddevelopment, product development, and manufacturing.

Mr. Lazaridis is also a leader in his community and apassionate advocate for education and scientific research.Mr. Lazaridis supports his community and country through

generous philanthropic gifts made possible by his success inbusiness.



RIM MilestonesRIM Milestones

1995-1999

Canadian Fund Incinvest C$5M

C$30M in pre-IPOfinancing

RIM launch

Blackberry

2006-2008

Free Pocket Macfor blackberry

One of Canada’sTop 100 Employers

20092009Expand Globaloperations

Acquire DashNavigation, TorchMobile

Fortune Magazine

fastest growingcompany

20102010

Acquired BlackBerryapplications

developer Viigo andQNX SoftwareSystems

Announced the longrumouredBlackBerry PlayBooktablet computer

Held 10.4% of thesmartphoneoperating systemmarket

20112011

BlackBerryPlayBook wasofficially releasedto US and Canadianconsumers

RIM's shareholderslost almost$70 billion or 82%

Axed 2,000 jobs,the biggest lay-off in its history or 11%from 19,000 to

17,000

http://en.wikipedia.org/wiki/QNX

http://en.wikipedia.org/wiki/BlackBerry_PlayBook

http://en.wikipedia.org/wiki/Tablet_computer

http://en.wikipedia.org/wiki/Smartphone

http://en.wikipedia.org/wiki/Smartphone

http://en.wikipedia.org/wiki/Tablet_computer



http://en.wikipedia.org/wiki/QNX



-5,000,000,000

0

5,000,000,000

10,000,000,000

15,000,000,000

20,000,000,000

25,000,000,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Sales Operating Income Net Income

Sales, Operating Income and Net Income (2002Sales, Operating Income and Net Income (2002--2011)2011)Research in MotionResearch in Motion

Source: Wikipedia



Marketing StrategiesMarketing Strategies

1999 2002 2006 2007

launched Blackberry

handheld mobile

phone with “pushed”

technology

easy to usehas “encryption

software.”

RIM Non-server &

BB Enterprise Server

(BES)

Corporate SolutionsCentre

Free trial to CEOs

(Jack Welsh, GE)

Proprietary brand

that companies

asked for by name

Popular and

indispensablesolution in

organizations

Made its way to

Pop culture,

shown in movies

and TV shows

20% of all PDA

sales

59% of corporate

wireless e-mail

traffic

Initiated BB trade-

up program

Slipstream, increase

internet browsing

efficiencyLaunched BB Pearl

8100 and BB Curve

8300

Increase R&D

Budget to $235M

Inventors Banquet

Mobile & Desk

Phone integration



SWOT Analysis



SWOT AnalysisSWOT Analysis

STRENGTHS WEAKNESSES

•Leading position in handheld market

•Product offerings for personal, prosumer and

enterprise markets

•270 network operators in 110 countries

•Awarded the FIPS 140-2 validation by USNIST for

encryption technology

• Low employee turnover rate (1%)

•Consider customers before any product changes

•Formed controls to monitor work efforts globally

•Continuous product innovation

•Strong experience in data transmission

•Pioneer in “PUSHED” technology

•Blackberry hardware & software system is easy-to-use

•Advanced ENCRYPTION SOFTWARE (met Intel’s security

benchmark)

• Small “enterprise market”

•Dependent on network providers

•Weak market share in consumer

and prosumer

•Over production vs subscriber

signed

•No validation in Europe,

Australia & New Zealand

(purchase criterion for

government and military)

• Challenges in product

innovation vs security



SWOT AnalysisSWOT Analysis

OPPORTUNITIES THREATS

•Growing wireless market, approximately 3B

in 2007

•Increasing demand for multiple functions

phone•Network providers sizable investments for

upgrade, fit for new devices

•Fast subscribers growth in China, India,

Japan, Russia and US

•Partner network in Europe, Asia Pacific,

Africa and Latin America•Market penetration in Australia, India,

Singapore and Hongkong

• Large competitors were starting to target

RIM enterprise market

•Business subscribers approaching saturation

•

Strong pricing pressure in consumer market•Apple iPhone consumer phenomenon

•Large competitor in consumer market –

Nokia & Motorola

•Motorola & Nokia offerings of cost-

optimized market and increasing market

share



RIM should still prioritize dominating enterprise market because RIM’s competitive advantage

is it’s "Encryption Technology”, Data security differentiates them among competitor. RIM must

develop enterprise related software applications for various business functions that can be

easily integrated with firm’s current technology. They might also consider having a different

marketing strategy for “Small Enterprise” market segment who are smaller organizations with

lesser budget but would like to adopt Blackberry technology.

However, offering retail-friendly and lower-profit phone models such as Curve will also

contribute additional sales.

They should also expand in international markets particularly in Europe, Asia Pacific, EMEA,

and Latin America. They must also work on winning validation in Europe, Australia and NewZealand so they will be the preferred brand in government and military market.

Which market should

RIM emphasized?

09_research in motion

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