Rumor: RIM Considering Team-Up With Microsoft, Selling Network Business

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Three inside sources have revealed that Research in Motion (RIM) is being forced to consider options such as teaming up with Microsoft or selling off its network business after devices featuring its next-gen BlackBerry 10 OS were once again delayed.

RIM BlackBerry LogoThe market value of the company is down to $4.1 billion, and a recovery may be difficult given that RIM has said that the launch of its BlackBerry 10 devices has now been postponed to early 2013. What was the reasoning for yet another delay, putting the release of its next-generation operating system over a year beyond its initial release timeframe? The OS had “proven to be more time-consuming than expected,” RIM told Reuters.

RIM’s stock has plunged roughly 70% in the last year and shares took a steep 18% dive on Thursday after it revealed a more drastic quarterly operating loss than expected, so the company’s board is now being forced to consider other options.

One such option would be to abandon the BlackBerry OS and adopt Microsoft’s upcoming Windows Phone 8 operating system on its devices. This may not be a completely arbitrary idea, as Microsoft CEO Steve Ballmer recently approached RIM and suggested a partnership akin to what the Redmond-based company currently has with Nokia. Additionally, the sources claimed that Microsoft may be interested in RIM’s wireless patents.

Microsoft LogoShould RIM opt to go this route, it would want Microsoft to buy a stake in the company and fund marketing and other expenses. Still, according to the sources, this is not a particularly favorable option for RIM as it would mean the end of the company’s independence, so the board would rather attempt to follow through with the BlackBerry 10 efforts. Both RIM and Microsoft declined to comment on the rumors when contacted by Reuters.

Another course of action is for RIM to sell its proprietary network to a private firm or another technology company, allowing it to be used by other smartphone providers. This is also not ideal — not that anything about RIM’s current situation is ideal — as it would basically mean the end of the company’s future in the realm of devices.

Source: Reuters



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