Lenovo Could Take Over RIM 114
judgecorp writes "China's Lenovo could take over RIM, according to Lenovo chief financial officer Wong Mai Ming, speaking at the World Economic Forum in Davos Switzerland. The Canadian authorities might object, and so might BlackBerry users, after what ultimately happened to the ThinkPad brand under Lenovo's guidance. Canadian Finance Minister Jim Flaherty said, 'It’s something that we would look carefully at. We always look at foreign investment in Canada as a cause for reflection. We have to look at intelligence concerns.'"
What happened? (Score:4, Insightful)
You mean, they would object if RIM devices kept working as before?
Re:What happened? (Score:3, Insightful)
This would probably kill all US Federal contracts (Score:4, Insightful)
After examining how the United States treats Huawei networking gear, I'm sure this would kill all the US (and State/Local) government contracts with RIM.
US Government contracts are one of the few highlights of RIM's business right now.
Re:Taking over RIM is not making any difference (Score:5, Insightful)
The way I understand it is that while RIM is struggling in North America, they're still pretty dominant in the rest of the world. And the rest of the world is still a pretty big market.
Too little cash and unattractive products (Score:5, Insightful)
RIM has positive cash flow, no debt, and significant capital assets and cash
RIM has had an operating loss for the last 4 straight quarters [google.com]. While you are correct that the company isn't on financial life support (yet), their prospects are not looking especially cheery. Their cash hoard is around $3 billion which while substantial is tiny compared to Google, Apple, Microsoft and Samsung. All their major competitors have extremely strong balance sheets, far stronger than RIM. It's a bit like playing poker when everyone at the table has a much larger pile of chips. You still can win but the odds are not in your favor.
RIM is far from dead and with their new offerings have continued opportunity to grow.
The sales numbers for RIM's products are do not back you up. Competing products from Apple and Android makers are in far higher demand. RIM's product line is pretty widely considered to be not competitive. While RIM might succeed yet with some brilliant new products, there is little evidence so far that we should expect anything that will put them ahead of the curve.
Another thing to consider - RIM is still has the only FIPS compliant smart phone on the market.
Which is something that the majority of the market could not care less about. At best it gives them some breathing room for a little while. But the number of people who really need that level of security is a pretty small fraction of the overall market. RIM needs a product offering with much broader appeal and significant advantages over the competition. Right now this is a battle they are losing and losing badly.