Business21.10.2011

BlackBerry split needed

BlackBerry

BlackBerry’s global outage has made the takeover or shake-up of its parent Research In Motion (RIM) more likely say analysts, despite its peace offering aimed at appeasing frustrated customers.

On Monday Canadian based RIM offered BlackBerry customers free premium apps worth a $100 (about R800) as a form of compensation for its service interruptions and outage last week.

The initiative has been done as a measure to “reward consumers for their loyalty… during the outage last week,” said Patrick Spence, managing director, global sales and regional marketing for RIM.

RIM’s “token of appreciation” to customers includes free technical support until the end of December this year. The apps will be available on BlackBerry smartphones and not on the company’s tablet device – The Playbook.

The outage spanned across three continents last week, with just over 1.5m users in South Africa being affected.

Senior research analyst for ICT practice at Frost & Sullivan, Vitalis Ozianyi says after this outage it makes sense for Vodafone to acquire RIM “to make use of its internet service as a way to boost its data services whilst being in control of the kind of services and content that it delivers”.

He adds that Samsung purchasing RIM’s hardware device manufacturing component also makes sense as it might eliminate a major player in the device segment.

With regards to Canadian merchant bank Jaguar Financial Corp’s call for RIM to be split into separate public companies – a network company, a device company and a patents company -Okeleke says that this may not be a winning formula for the company.

“I don’t see either of these components surviving on their own.  BlackBerry is not known for making the most aesthetically appealing phones, but its business solution is what added value to it for a lot of its customers. Separating the two would be a drastic move for the company as the combination of the two is what has helped it gain market share,” said Okeleke.

Analysts also believe that RIM will have to rethink its business. Senior Research Analyst for ICT practice at Frost & Sullivan, Vitalis Ozianyi reckons it should consider “discussions on inter-operability between instant messaging services offered on different platforms and providers”.

Pity that Spence on Monday said the company believes that “business will continue as usual.

“We will leave no stone unturned to make sure that what happened last week will not happen again, and in that way we are showing our customers and shareholders that we will… take steps to avoid future outages.”

Spence adds that a positive uptake in the apps will help the company “keep the momentum that it currently has”.

Source: Moneyweb

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