BlackBerry Maker RIM Might Be Bought: Cisco and Microsoft Possiblities
How is this for a rumor? The maker of the BlackBerry smartphone series—Research In Motion (RIM)—might be the target for a takeover. Shaw Wu, an analyst for Kaufman Bros., claims that while it is a possibility that is helping fuel RIM’s stock price (RIMM) rise of 12% over the past couple of days (along with the live demo of RIM’s BlackBerry PlayBook tablet). However, he remains skeptical that a buyout of RIM will take place.
Who would want to buy RIM? That is a good question. A better would be: Who would want to buy RIM that can afford its $30 billion dollar market cap? That list is considerably shorter. Shaw Wu names Cisco, Microsoft and Oracle as all potential buyers. They all want a piece of RIM’s business clientele in the smartphone market and the money to actually pull off an attempt.
UBS analyst Philip Huang thinks that a Cisco buyout of RIM would make the most sense and that if RIM’s stock price dips low enough, Cisco will move on RIM. Both companies provide sophisticated IT solutions to businesses of all sizes. Furthermore both companies are developing tablet computers run proprietary operating systems based on UNIX. Both the tablets—the Cius and the PlayBook—have front and rear facing cameras and will be capable of cloud based computing tasks through client software. They will also be able to run virtual machines and both are being targeted towards business users.
Another potential buyer would be Microsoft, which competes directly against RIM for business customers in the IT market. The two also compete in the smartphone market and Microsoft is launching Windows Phone 7 (WP7) to compete against RIM’s BlackBerry OS 6. BlackBerry OS is showing its age and RIM has plans to move its entire smartphone line to the BlackBerry Tablet OS that it is developing with its recently acquired QNX Software Systems for the BlackBerry PlayBook. WP7 has a much larger challenge facing RIM’s Tablet OS, which is heavily based on Adobe’s AIR SDK and developers will be able to easily create apps for WP7, iOS, Android and QNX’s Tablet OS with Adobe AIR and Flash 10.1.
So what do you think BlackBerry owners? HP’s purchase of Palm has breathed new life into the company and Palm is releasing five to six new smartphones next year and the Palm Pre 2 this year. If Cisco buys RIM, you can expect BlackBerry to live on but if Microsoft does, they will most likely migrate BlackBerry owners to WP7. Your take? Tell me in the comments.
Tags: Microsoft, Cisco, QNX, BlackBerry, RIM
Hutch,
I am also a stockholder. I use the Blackberry product and love it. The few limtations that the phone has will be addressed with the new OS. RIM’s purchase of QNX is a big deal from a technology standpoint. I don’t work in the industry, but I have done some research with IT professionals who have filled me in on the new OS. The IT community is excited about the new OS and its capabilities. Once again, RIM’s market niche is corporations and governments. The IT professionals will chose which products and platforms the companies will use and they like RIM. They are not taken in by hype, like we see with Apple fans.
The short interest that have mounted against RIM are under the false impression that RIM and Apple are in some sort of zero sum/death match competition. It’s stupid. They can both grow in thier respective markets without harming eachother. As more information comes out about RIM’s new products and it’s financial performance, the bears will run into the woods and bulls will drive the stock price up.
My opinion is based on my objective exmination of RIM and its products, not marketing hype. RIM is solid. I cant wait to buy a Playbook and a phone with the new OS.
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I see RIM touching $150 by 2012 Q3.
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I agree with Hitch.
RIM is not trying to break into the smartphone market, it is the major player.
RIM does not need the money, it has no debt and $2B in cash and has already paid for the expense of developing its next generation products.
The new Tablet OS is a game to changer for the industry. It is far superior to the other OS used in the other tablets. It will not need apps, it will interact directly with the web, like a desktop.
Blackberrys market is the business and govt user. The new tablet is a designed to be a powerful business tool with superior capabilities, reliability and security. The other Tablets are inferior and will have to catch up after having sold second or third place product to its customers who were early adopters. Anyone who bought a iPad for business use will feel used once they see the Playbook at work.
Finally, MS should have focused on providing software and support for products like the Playbook. No one want a MS branded PC or phone. The Windows phone is a answer to a question that no one is asking.
RIM is leap frogging the others in meeting the needs of the business user. RIM can make plenty of money without chasing the iPad fad purchaser.
It is also unlikely that the Canadian government would allow RIM t be bought by MS.
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Hutch Reply:
October 28th, 2010 at 11:20 am
@Rob,
Thanks Rob, Well said my friend!!
They should hire us at RIM.
I’m a RIM shareholder at $72.00/ share and more recently @ $49.00/share.
Bye the way it’s HUTCH not Hitch lol
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You know I getting real sick of this debate. RIM is not for sale at any price !! In fact watch out they don’t buy someone else and improve on their already dominating products and services.
Just wait until you hear the quarterly results for this year and next, you will wish you had bought RIM stock in the mid $50′s when it’s at $80 to $95.00 NEXT YEAR, GUARANTEED.
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