On a Canadian radio show Tuesday, Research In Motion (NASDAQ:RIMM) CEO Thorsten Heins actually said there was “nothing wrong with the company” and it’s not in a “death spiral.” Unfortunately for Heins, few investors believe this. Over the past year, the stock price is off by about 75%.
Now, it’s understandable that Heins wants to provide an upbeat message. Wouldn’t it help with morale and confidence?
While it seems reasonable, the approach really makes Heins look mostly delusional. The problem is that he doesn’t have a clear vision for the company.
Compare Heins to Apple’s (NASDAQ:AAPL) Steve Jobs when he returned to the struggling company in 1997. Jobs identified the main problems threatening Apple’s existence and put together a clear-cut strategy to get back on track (here’s the video of Jobs’ masterful presentation at the 1997 Macworld).
RIM, however, has little visibility. The upcoming Blackberry 10 operating system — which has been delayed until early 2013 — doesn’t look like a game-changer. RIM also doesn’t have a tablet that will get the attention of an increasingly crowded market.
In light of all this, the company’s corporate market business — once seemingly impregnable — could be extremely vulnerable. Keep in mind that Apple’s products have seen big improvements in security. Oh, and Microsoft (NASDAQ:MSFT) should be able to get some traction, especially as it leverages its Windows franchise. Even Google’s (NASDAQ:GOOG) Android is becoming more corporate-friendly.
So, when it comes for businesses to make budget decisions, will they go with a company that’s ailing as deeply as RIM? Or will they focus instead on major players that have massive ecosystems and standout products?
I think the answer is obvious: Corporate customers will ditch RIM devices.
Sorry Thorsten, but it does look like a death spiral. Maybe the best strategy is to find ways to preserve assets, such as with sales of various business segments. But otherwise, there appears to be little hope for RIM.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of the upcoming book How to Create the Next Facebook: Seeing Your Startup Through, from Idea to IPO. Follow him on Twitter at @ttaulli or reach him via email. As of this writing, he did not own a position in any of the aforementioned securities.
