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New RIM CEO Will Stay the Course; Is that Enough?
By Barry Levine
Posted: January 24, 2012 9:22am PST

Thorstein Heins has been chief operating officer at RIM for product and sales since August, and he's been with RIM, previously as senior vice president for hardware engineering, since 2007. On Sunday, RIM's board announced it was replacing co-CEOs Mike Lazaridis and Jim Balsillie with Heins, who became president and CEO.

The new CEO at Research In Motion plans no big new plans. In a conference call with news media and analysts, Thorstein Heins said that he does not believe "there is some drastic change needed."

Heins did say in the call Monday that the company needed to improve its marketing efforts, and he has said that there will be improvements in process. He also said that the new BlackBerry 10 operating system, expected to be released later this year, will be a major hit with consumers and businesses, and that the company will consider licensing it to other manufacturers.

'A Planned Succession'

A number of RIM-watchers have expressed disappointment that no new direction is planned, given the trail of problems the Waterloo, Ontario-company has faced recently.

Its profits and share price have dropped more than 70 percent over the past 12 months. The company announced last month that the launch of its much-awaited, critical BlackBerry 10 line would be delayed.

Earlier this month, a U.S. District Court judge ordered the company to change the name of its new BBX operating system because of a trademark dispute with a New Mexico-based company. BBX, which had been unveiled in October, was renamed the BlackBerry 10 OS. RIM's PlayBook tablet, now heavily discounted, has had disappointing sales. And RIM is also trying to restore trust following days of service interruptions last fall.

Ross Rubin, executive director for connected intelligence at the NPD Group, noted that the company has positioned the appointment as "a planned succession, rather than a board-driven ouster," as when Nokia brought in a new CEO last year.

At that time, he said, Nokia was similarly facing a "declining market share, technological transitions, and there was also a perceived lack of competitive attributes."

'Too Early to Say'

Nokia, Rubin pointed out, chose to bring in an outsider, who "upended the current OS strategy" by deciding to partner with Microsoft. RIM's replacement of the two co-CEOs with one, he said, is most likely a key part of the process improvement that Heins has promised.

Rubin said that "it's too early to say" if the Heins appointment, and the general continuation of the current strategic direction, is going to be enough. "We haven't yet seen the full picture of what BlackBerry 10 can do," he said.

While Nokia felt it couldn't develop a "big enough OS, fast enough" through internal development, Rubin said, RIM apparently feels it can build on its strengths, including a better position in the enterprise than Nokia's. But the real challenge, he said, is going to be "developer support for a new generation of phones powered by this new OS" in an environment of tough competition.

On Sunday, the company's Board of Directors announced that it was replacing the current co-CEOs, Mike Lazaridis and Jim Balsillie, with Heins, who became president, CEO, and a member of the board. Lazaridis became vice chair of the board, and Balsillie will continue on the board.

Heins had been chief operating officer at RIM for product and sales since August, and he's been with the company, previously as senior vice president for hardware engineering, since 2007.

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