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RIM Goes on the Offensive to Retain Corporate, Government Clients

Research in Motion (NASDAQ:RIMM) continues its struggle to remain relevant in the mobile space. Analysts are sounding increasingly bearish about the company’s fourth-quarter earnings report (due on March 29), with the Financial Post reporting on sliding BlackBerry sales in Europe that could lead to the company coming in below the 11 million to 12 million units it had targeted in its guidance.

If this forecast is accurate, then RIM’s revenue for the quarter could be in the $4.3-billion-dollar range instead of the $5-billion range it had previously suggested.

However, RIM is not sitting still and appears to be taking a more aggressive stance on retaining the large corporate and government clients that are the core of its business. Apple‘s (NASDAQ:AAPL) iPhone and iPad, and smartphones and tablets running Google‘s (NASDAQ:GOOG) Android, may be dominating the consumer market, but RIM needs to fend them off in the corporate and government space if it is to survive.

Haliburton (NYSE:HAL) recently announced it was ditching its 4,500 BlackBerrys for Apple devices, and the U.S. Oceanic and Atmospheric Administration has also publicly stated it was dropping the 3,000 BlackBerrys used by staff in favor of iPhones. There is concern that these could be just the tip of a looming iceberg.

Building loyalty through Balance

According to the Globe & Mail, RIM has sent a strongly worded statement out to its major corporate and government customers in an effort to stave off further defections. The company says it is working closely with customers to replace older devices, offering support for rival devices through its BlackBerry Mobile Fusion management software, and providing a new product called BlackBerry Balance that allows employees using BlackBerrys to safely run personal applications on the devices.

Above all, RIM is stressing security, reliability, and value in sticking with BlackBerry. The statement, quoted in the Globe & Mail, repeatedly pushed these key points: “RIM’s new BlackBerry 7 devices offer a highly competitive and compelling choice for both government workers and government IT departments, and the BlackBerry platform continues to offer the best value for taxpayer dollars while providing advanced security for potentially sensitive government data.

A key companion for its PlayBook tablet

In addition, RIM also announced the release of the BlackBerry Mini Keyboard for use with its PlayBook tablet, incorporating a full QWERTY keyboard, stand, touchpad and Bluetooth connectivity. It’s hoped that this accessory will help to make the PlayBook a more compelling buy for corporate and government customers who might consider the tablet in place of a notebook computer for light duty remote computing capability.

Shares in the beleaguered company are now trading in the $13.50 range, down from nearly $15.50 in February as investors digest the apparent bad news on the sales front, while hoping that long-awaited BlackBerry 10 devices appear in time to prevent a slide from becoming an exodus. For RIM, keeping the big clients from transitioning to iOS or Android in the meantime is now a top priority.

As of this writing, Brad Moon did not own a position in any of the stocks named here.

Article printed from InvestorPlace Media, https://investorplace.com/2012/03/rim-goes-on-the-offensive-to-retain-corporate-government-clients-rimm-aapl-goog/.

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