Rumor: Microsoft may gobble up Blackberry maker RIM

By on May 6th, 2011 at 6:36 AM | Mobiles News

With Research In Motion(RIM)’s failed attempt at a tablet with the Playbook and dipping sales all over the table, speculations have begun that RIM might be looking towards a buyout. What fueled the speculation that Microsoft may be rooting for some Blackberry pie was the presence of Microsoft CEO Steve Ballmer at the Blackberry World conference which was recently concluded. More on this after the break.

Present state of Research In Motion(RIM)

RIM recently announced its two new smartphones Blackberry Bold 9900 (pictured above) and 9930 along with BBOS  7 (more on that later) which did not gain any investor enthusiasm nor customer momentum. RIM’s cross-platform move by allowing Android applications on the Playbook also did not help the tablet much, which was still called “half-baked”. Plummeting market shares plus declining growth rate expectations don’t help either. Therefore we are looking at a possible buy-out position of RIM within the next 6 – 18 months.

The speculation and rumor

All this speculation was started with the partnership of Microsoft and RIM with Bing becoming the default embedded search provider for the future Blackberry smartphones that would feature BlackBerry OS 7 as well as the newly launched Blackberry Bold 9900 and 9930. This speculation became stronger with the presence of Steve Ballmer at the at the annual Blackberry World conference. Although Ballmer came to announce their partnership on Bing, but it signified a much larger perspective by joining hands with a rival mobile platform.

Market analysts say that Microsoft at present has about $48 Billion in cash reserves while RIM is valued at around $25 Billion, but at the present rate of decline that might be reduced to $15 billion.

Harry Wang, director of mobile research at Parks Associates, told PC Magazine that:

Microsoft (currently) has $48 billion in cash. If RIM’s value drops to $15 billion, it will become an attractive target for Microsoft. Maybe Steve Ballmer was planting that seed during his keynote appearance at Blackberry World.

The road ahead

Microsoft has already tied hands (pun intended) with the top handset manufacturer of the world, Nokia, for its Windows Phone 7 platform, which seems to be gaining a small but sure foothold. But with Blackberry, Microsoft will gain a plethora of Enterprise users that are presently shying away from the WP7 platform. Just think over the next two years what would happen to Windows Phone 7 with Nokia on one side with the biggest share in terms of phones sold per year in the entire world and the enterprise adored RIM’s Blackberry on the other. WP7 would become a formidable force to reckon with for both Google’s Android and Apple’s iOS.

Herein lies the lure for Microsoft. Gaining a foothold in the future of Mobile computing with two of the biggest names in the industry would boost WP7 to the highs where it might become untouchable by the likes of Google and Apple. Reason being Microsoft had and always has the resources to pull something off like this. Windows Phone 7 was a fresh start, all it needs is a bit of endorsement and who better to do it than the top-most mobile companies of the world.

For now, it would be a very Bold move for Microsoft to plan a takeover on RIM, but 6 months down the line it might just be inevitable. Keep watching this space, we will hit you up with an update as soon as we have one.

Source : Globe and Mail

Category  |  Mobiles News

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