Suckers never die, they just exchange places with each other - A proberb
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Microsoft could buy RIM
STOCK MARKET FALLING STAR Research in Motion (RIM) might have won itself attention from Microsoft, the increasingly mobile phone hungry software behemoth.
RIM posted disappointing financial results last week and has earned itself some scorn from financial analysts for its poor performance and uninspiring releases. This negative trend has rubbed off on the firm's financial worth, which has fallen like investors' jaws. This drop off could see it bought by Microsoft or Dell, according to a financial analyst and investor.
When RIM released its financials early this month it was positive in the face of adversity. "RIM's business is profitable and remains solid overall with growing market share in numerous markets around the world and a strong balance sheet with almost $3 billion in cash," said Jim Balsillie, RIM's Co-CEO. "We believe that with the new products scheduled for launch in the next few months and realigning our cost structure, RIM will see strong profit growth in the latter part of fiscal 2012."
In addition, the firm also announced redundancies, though much lower down on its announcement. Job cuts do not tally well with positive talk, even when they are dressed up as a "reallocation of resources".
While Morgan Stanley chose to rubbish the firm before it released its financials, saying, "We believe RIM has now squandered nearly every opportunity and competitive advantage it enjoyed through ineffective R&D resource management, delayed product launches and misreads of the competitive environment", BMO Harris Private Banking gave it a little breathing space before telling everyone that as a company its its own right, its game is over.
Bloomberg reports on a research note, which we have not been able to get hold of yet, that said Dell and Microsoft might be tempted to invest in the firm, particularly as its value wouldn't raise many eyebrows in the accounts department.
"Given how significant the deterioration of the stock price has been, that alone will cause interest," said Paul Taylor, chief investment officer at BMO Harris in Toronto. "RIM still has meaningful market share in the U.S. and meaningful market share internationally, and RIM has an iconic brand."
RIM does have an iconic brand, as does Skype, and as does - or maybe, did - Nokia, and both of those have been courted successfully by Microsoft in recent months, regardless of whether they were profitable or not. µ
Tags: Hardware
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MS should!. Its a great idea, they have the resources to make RIM a leading premium product and shake up RIM's lousy management.
OK there is the plan. Make QNX the leading tablet and high-end smartphone OS, keep WM as medium to down-end mobile OS. Let Win8 move to "super-tablets" and they can stay competitive in all areas.
Besides, QNX can provide XboxPad device to talk on Nintendo and Sony. Its a move that only MS has the money and muscle to do.
RIMM encryption is loved by business but hated by Governments. Most especially those Governments who are currently shooting those citizens who disagree with them or will probably end up shooting those citizens not yet disagreeing but porbably will someday.
If a Blackberry could somehow work P2P rather than through RIMM servers, then the era of secure encrypted communications will be upon us.
I think Microsoft bought Skype for just that reason. Skype uses networks but not for storage. So the next piece of the puzzle is a proprietary encryption business model for secure comm's. RIMM has that. So Microsoft is probably trying to decide whether it is worth buying RIMM or do they reinvent the wheel.
Oh yeah.............it's not about stock price, it's about market cap.......and RIMM's is sinking. Not quite below the rim yet though.
Microsoft has never bought a hardware company, and never will because subcontracting is much cheaper.
Don't waste your money on buying RIM Microsoft. Just install one of your ex-employees as RIM's CEO. Bam.
If I have a company with shares valued at $1000 each does that make it more valuable than Microsoft? Not if there are only 100 of them. Share price * number of outstanding shares gives you market capitalisation, the amount of money you'd need to spend to buy the company. RIM would cost you about $14.2BN, Microsoft $204BN. A buy-out typically costs 30% or more than market cap ($18.5+BN)
The important question is what would the value of RIM be to MS or DELL. MS would throw much of the technology away (why would they want QNX for example) and it would cause friction with their phone OEMs. DELL is a little too small to make the purchase easily affordable (market cap of only $30BN) but it would get them into the phone and tablet markets in a meaningful way.
RIM's stock price is higher than both Dell and Microsoft. I don't think they need either. They just need to get rid of those idiotic co-CEO's who think it's ok to release half a$$ products and find ONE CEO who can refocus the company and get the job done.
The one and only reason for M$ to buy RIM would be to kick QNX to the curb, i.e. eliminate that potential competition.
Sounds exactly like something M$ would do - blow a huge wad of cash on a dwindling threat while watching Android (and to some extent Iphone) continue the market dominance. It is just a stupid enough idea that it might happen.
Broke up so soon?