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BlackBerry maker 'going through transition'

BY PAUL ALLEN Business reporter allenp@jamaicaobserver.com
Friday, July 06, 2012

MAKER of the popular BlackBerry smartphones, Research in Motion (RIM), says the company isn't faltering and is merely going through a "transitional period".

Despite global outages of its messaging service, BBM, delays to its PlayBook, which will compete with the increasing popularity of tablets by Apple and Google, and issues with its latest operating system, BlackBerry 10 , the company "means business", said Caribbean RIM's director, Sean Killen.

The company has launched a US$1-billion ($88-billion) initiative to drive operational savings, Killen said, adding that RIM wants to quickly move forward and align itself with growth opportunities when the change ends.

RIM reported revenues of $2.8 billion for its first quarter that ended June 2. That's 43 per cent off the US$4.9 billion that the company reported for the same period last year.

Additionally, last week RIM announced it will cut 5,000 jobs and that no BlackBerry 10 devices would be available before early 2013.

The company has to "operate efficiently and be cost effective and unfortunately, at this point, that means reducing costs and head count", Killen said, adding that the number of subscribers continued to grow during the quarter under review.

BlackBerry continues to be the leading smartphone in Latin America and the Caribbean, he said. However, that position is being challenged by Apple's iPhone and other devices using Google's Android software.

One of the major challenges of BB users is the number of applications (apps) available to them. RIM has seen a 220 per cent increase in apps to over 89,000 in the last year, Killen said. However, that's a drop in the bucket compared to the half a million that Apple's "store" boasts.

There is momentum, he added, and developers have submitted 25,000 PlayBook apps, many of which will run on BBX devices. "We're expecting tens of thousands more, including some built specifically for Blackberry 10" in time for the launch next year.

Though the delays to BlackBerry 10 may be costly, Killen said the significance of the change cannot be understated and that "doing it right is more important than doing it fast".

Even as RIM plans to have a big turnaround next year, Apple announced the latest version of its operation system, iOS6, last month with speculations that a newer iPhone model may be out by year-end, strengthening the charge to close the gap between the two companies.

That said, "RIM is refocusing on the enterprise business to capitalise on our leading position in this segment," Killen said. "We also have every intention of being part of the consumer market."

RIM has 78 million users globally.




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