Is RIM A Target for Acquisition?
When the announcement that Google was in the process of acquiring Motorola Mobility – a huge mobile producer that is currently very active in the development of Android powered devices – dropped on Monday I for one was a bit surprised. Not only was this a very big move for Google, and of course a potentially costly one as well, but most of all the acquisition announcement was very bold,as it showed that Google was committed and devoted to furthering Android development and building the Google empire that much stronger. While the news caused Google stock prices to fall (as to be expected), Motorola stocks held pretty well (increasing, even); as did the stock prices for Research in Motion (RIM). As the New York Times points out, most of this increase is due directly to speculation over a potential RIM buyout, a concept highlighted after the Motorola acquisition announcement.
And of course as a good blogger I must ask myself if RIM really would be a worth-while purchase for a company. Sure, RIM isn’t exactly producing cutting edge technology right now and their efforts in the past years (the BlackBerry Torch and the BlackBerry PlayBook) have been somewhat pitiful and I’ve even considered alternate ventures for the company. But when it comes down to it RIM has done incredibly well with the BlackBerry line over the years, and even if it’s not cutting edge right now there simply isn’t denying the popularity of the BlackBerry line in corporate (and even personal environments). After all, RIM used to be an innovator in the mobile sector, and I honestly think they have the potential to be again. But who would (or should) buy them?
My initial guess? Microsoft. Despite being in a less than idea position with the Windows Phone lineup right now, Microsoft’s brand name (and I would even argue strong-point) is in business-focussed devices and services; something that they could very well expand upon by acquiring a company with a very similar reputation.
But as perfect as this reputation would appear and as wonderfully as things may seem on paper, the fact of the matter is that there really is very little reason that Microsoft – or any other company for that matter – would or should buy out RIM. You see, one of the biggest things that RIM has had going for it over the years has been the fact that the company produces its own mobile operating system (the BlackBerry OS, or “BBOS” for short). This operating system has done very well based on the fact that it is insanely stable, secure, and adaptable to the various needs of businesses small and large alike.
The advantage of producing and maintaining its own operating system, though, becomes a huge disadvantage when we look at RIM from the perspective of a company that would be even remotely interested in acquiring RIM. Look at it this way; why would a company like Microsoft want RIM when its biggest asset and the only thing that it really seems to have going for it is an operating system that would essentially be phased out or poorly merged? I mean, what good is RIM’s BlackBerry OS to a company like Microsoft that already develops and maintains its own mobile operating system? From a development perspective, incorporating RIM code into another already-developed platform would be a bigger pain than it would really be worth.
That said, there are still a handful of reasons that RIM could still be on the radar for accession. Asides from the reputation that the company has, RIM’s early work in mobile technology means that the business is sure to have a stockpile of patents. And seeing as how Google has pretty much said that the Motorola move was at least partially motivated by the patents the company would in turn acquire, there’s no doubt in my mind that RIM’s patent collection is something that has been considered as well. But even when looking at the potential value of RIM’s patents I honestly don’t think that the company is worth acquiring right now. That is, of course, assuming that the buyer couldn’t make use of RIM’s BlackBerry OS.
But what if there was a buyer out there that could? Up until recently I wouldn’t have guessed that there would be a company with a want nor desire to buy RIM. My thought on this matter has changed though now that Google has shown that they’re not against getting down and dirty and engaging in new ventures in order to establish themselves in the mobile industry.
What am I getting at? If Google can take on the hardware industry pretty much overnight what exactly is to stop a hardware company from taking on the mobile software arena just as swiftly? I’ve already speculated that Google’s Motorola buyout would step on the toes of their existing hardware partners, and it would almost seem perfect if a company like HTC were to turn around and pick up RIM; not only building up their hardware offerings, but getting their hands on their very own mobile operating system as well.