Should RIM contract out consumer devices?

**DenverRalphy** · 11-10-2011, 06:11 PM

Once BBX is considered stable and ready for release, does anybody think it would do well by RIM if they were to contract out their consumer devices to outside manufacturers like Samsung, HTC, etc..?

I could probably argue for or against, but the pros currently in mind would outweigh the cons. Especially when limiting it to Consumer devices and not taking Enterprise devices into consideration.

I can't help but feel that it would help where RIM is weakest (IMHO); Which is their poor track record of getting a device or product from the drawing board to production in a timely manner.

**herculesinwyoming** · 11-10-2011, 06:35 PM

Interesting idea, I am curious to see what every one else has to say about this.
What about buying a samsung galaxy or such and having a choice of which os you want to run on it.

**TheScionicMan** · 11-10-2011, 06:43 PM

There's practically no difference between the two.

**samab** · 11-10-2011, 06:48 PM

Originally Posted by rmjones101

I can't help but feel that it would help where RIM is weakest (IMHO); Which is their poor track record of getting a device or product from the drawing board to production in a timely manner.

The delays have to do with software --- and not even on the client side, server side software.

And everybody has that problem anyway --- honeycomb is an ugly hack. RIM doesn't want ugly hacks.

**Jaguarr40** · 11-10-2011, 06:57 PM

Originally Posted by rmjones101

Once BBX is considered stable and ready for release, does anybody think it would do well by RIM if they were to contract out their consumer devices to outside manufacturers like Samsung, HTC, etc..?

I could probably argue for or against, but the pros currently in mind would outweigh the cons. Especially when limiting it to Consumer devices and not taking Enterprise devices into consideration.

I can't help but feel that it would help where RIM is weakest (IMHO); Which is their poor track record of getting a device or product from the drawing board to production in a timely manner.

NO RIMS real problem has always been marketing and advertising more than anything else much less getting it from the drawing board to production. How many BB commercials do you see by RIM, carriers or any one else for BB phones compared to the iPhone and Android phone with 4g and 4g LTE?

As soon as RIM decides to maket and advertise their devices even if they help the carriers with subsidizing they may gain more interest and momentum in bringing interest to the public.

**Danf** · 11-10-2011, 07:05 PM

Why so RIM's phones can have a hardware failure rate as high as Android phones have?

**sportline** · 11-10-2011, 07:11 PM

android phones is too open to tweaks hence all the failure rates. radio and battery performance is also poor ( my galaxy s2 gets hot most of the time its not funny)..while nokias never get hot.
rim will never contract it's os..rim believes in closed, secure, controlled environment. and BIS/BES/BBM.

**kingbernie06511** · 11-10-2011, 07:37 PM

Yes! some of them! Blackberry by HTC.

or try to buy HTC

**berryjunkie** · 11-10-2011, 07:47 PM

OMG... BB OS on gs2 would be awesome!!!!!

Posted from my CrackBerry at wapforums.crackberry.com

**RevyRah** · 11-10-2011, 08:02 PM

... Instead of contracting out to other companies, RIM should simply allow the customers to choose all of the aspects of their device. True customization from every level. I'm talking from the number of processors, amount of memory, whatever os, SurePress, all the way to various physical keyboard styles... We name it. We get it.

I know that a lot of people feel that RIM should just limit the amount of BlackBerry models series being made to 3 (Bold, Curve, Torch) with various styles for each. I feel that nothing would be better, or more beneficial for all parties involved, than if BlackBerry phones were custom made per order.

**ichat** · 11-10-2011, 08:05 PM

Sure its think able but how will it benefit RIM? If they contract their OS, they basically let Samsung and HTC bite off half of their kingdom. Why? We have to admit that some people love the build quality of other phones and if they keep BBOS, RIM would be suffering. RIM makes their money from the phones. The OS is almost nothing to them except for the fact that it runs the phone

Posted from my CrackBerry at wapforums.crackberry.com

**mssca** · 11-10-2011, 08:07 PM

Samsung makes some parts for Apple iPads and iPhones.

**sleepngbear** · 11-10-2011, 08:11 PM

Besides what ichat said, which I completely agree with, if you think they're slow getting stuff out now, can you imagine how bad it would be if it were a third party building to RIM's spec? It's complicated enough being at the mercy of the carriers. Introduce yet another layer to the equation and it would be even more chaotic than it already is.

**just_luc** · 11-10-2011, 08:11 PM

Originally Posted by Jaguarr40

...As soon as RIM decides to maket and advertise their devices even if they help the carriers with subsidizing they may gain more interest and momentum in bringing interest to the public.

just throwing in my 2cents on this one as someone who worked in the wireless industry for over 10 years.

Apple does not subsidize carrier advertising. They contractually obligate the carrier advertise their product on their own dime in order to receive inventory. AND they mandate the exact content of the advertising, which is why you see the same ad's with different carrier logo's on the last slide.

**DenverRalphy** · 11-10-2011, 08:23 PM

Originally Posted by ichat

Sure its think able but how will it benefit RIM? If they contract their OS, they basically let Samsung and HTC bite off half of their kingdom. Why? We have to admit that some people love the build quality of other phones and if they keep BBOS, RIM would be suffering. RIM makes their money from the phones. The OS is almost nothing to them except for the fact that it runs the phone

RIM makes their money from BIS/BES subscriptions. Revenue from device sales is not where they make their money. If they contracted out phone manufacturing, they'd still pull in revenue from device sales, albeit lower than what they're currently making, but also spending less on hardware development/manufacturing.

**maxiang** · 11-10-2011, 08:39 PM

Originally Posted by Revyrah

... Instead of contracting out to other companies, RIM should simply allow the customers to choose all of the aspects of their device. True customization from every level. I'm talking from the number of processors, amount of memory, whatever os, SurePress, all the way to various physical keyboard styles... We name it. We get it.

I know that a lot of people feel that RIM should just limit the amount of BlackBerry models series being made to 3 (Bold, Curve, Torch) with various styles for each. I feel that nothing would be better, or more beneficial for all parties involved, than if BlackBerry phones were custom made per order.

...this would be a logistical and manufacturing nightmare

IMHO

On the customer side, the last time I saw a kinda custom phone company, it was $1000 dollars with android, touchscreen only, and one case option.

Posted from my CrackBerry at wapforums.crackberry.com

**ADGrant** · 11-10-2011, 08:47 PM

Originally Posted by rmjones101

RIM makes their money from BIS/BES subscriptions. Revenue from device sales is not where they make their money. If they contracted out phone manufacturing, they'd still pull in revenue from device sales, albeit lower than what they're currently making, but also spending less on hardware development/manufacturing.

I don't see how it would help them sell devices. Their problem isn't the hardware, its the software. The PB manufacture is already contracted out and nobody is buying that.

**Economist101** · 11-10-2011, 09:03 PM

Originally Posted by rmjones101

RIM makes their money from BIS/BES subscriptions. Revenue from device sales is not where they make their money.

Incorrect; according to RIM's last earnings press release, 73% of their revenue came from device sales, 24% from services (with 3% from "software and other services).

http://www.rim.com/investors/documen...ss_release.pdf

**DenverRalphy** · 11-10-2011, 10:39 PM

Originally Posted by Economist101

Incorrect; according to RIM's last earnings press release, 73% of their revenue came from device sales, 24% from services (with 3% from "software and other services).

http://www.rim.com/investors/documen...ss_release.pdf

I don't dispute that they pull in a lot of revenue from hardware sales. I was stating that that's not where they make the bulk of their profit. What percentage of the revenue from hardware is Net income after their own costs to manufacture their hardware.

I have always been under the impression that RIM is based around a subscription business model.

**DenverRalphy** · 11-10-2011, 10:53 PM

Originally Posted by ADGrant

I don't see how it would help them sell devices. Their problem isn't the hardware, its the software. The PB manufacture is already contracted out and nobody is buying that.

I guess I my question would have been more accurately phrased as "licensed" instead of contracted. Yes right now they have software issues during the conversion to BBX. However, prior to the change to BBX, the biggest issue the consumer had with BB was most definitely the hardware. It would take forever for newer devices to release that had any significant advancements compared to it's respective preceding models, which would then turn out to already be considered aging hardware upon release anyway. And not just aging hardware issue, but also that RIM has had their fair share of bombs with devices like the Storm/Storm2.

But my question was under the supposition that BBX is finalized/stable and ready for public consumption (and thus the current software issue being fixed). Licensing out to other manufacturers would allow for competitiveness in hardware design for consumers who prefer the BB platform.

**Economist101** · 11-10-2011, 11:37 PM

Originally Posted by rmjones101

I don't dispute that they pull in a lot of revenue from hardware sales. I was stating that that's not where they make the bulk of their profit. What percentage of the revenue from hardware is Net income after their own costs to manufacture their hardware.

I have always been under the impression that RIM is based around a subscription business model.

The facts don't support this. Total "subscribers" have been steadily climbing for years; if the majority of profit flows from services, then I'd expect profit to, at worst, remain flat, and in most cases increase. However, that's not what's happened; profit has been steadily falling sequentially over the past year, even as total subscribers continue to increase. However, if we compare profit to declining device sales numbers, the profit course begins to make sense.

**Caymancroc** · 11-11-2011, 12:04 AM

Originally Posted by Jaguarr40

NO RIMS real problem has always been marketing and advertising more than anything else much less getting it from the drawing board to production. How many BB commercials do you see by RIM, carriers or any one else for BB phones compared to the iPhone and Android phone with 4g and 4g LTE?

As soon as RIM decides to maket and advertise their devices even if they help the carriers with subsidizing they may gain more interest and momentum in bringing interest to the public.

Agreed.

I don't know why the OP even is considering this. The two co-CEOs in charge now are not going to change the business model to adopt something like this. That is not opinion, that is fact. If they were going to do this, they would and should have done this years ago, and not wait until BBX is "stable".

I also don't think Apple, Samsung, etc. has some great time-to-market advantage over anyone else. The reason your BB has a poor camera, potentially poor build quality (stuttering keypad on 9780), slow processor, weak app market, etc. is not because it was designed a decade ago and just got to the marketplace. It is because Jim and Mike screwed up. They figure(d) the business user wouldn't want the fun stuff (which is why they are in the position they are in) and basically are overlooking QC.

I don't know how long it takes to basically release a 9700, know you screwed up, then turnaround and slam a huge processor and awesome camera in it to basically re-release as the next gen and gain market share back. Instead they give us a 9780 (with keypad stuttering problems), now 9790. These are the same weak hardware phones, so the design portion of "time-to-market" is not the issue. It can't be. The design is done. They need to give people better cameras, processor, etc. These are openly available for purchase from processor manufacturers and camera companies.

Plus, most people are happy with the design/size of their BB. I like the size and style of my 9780. I think most like the size of the Torch, 99XX. What lacks is the goodies. I would like a FFC, better overall camera, faster processor, legacy support for OS upgrades, BT native keyboard, HDMI out, and better browser. These won't be solved by handing this off to Samsung. These ideas have to be supported and issued from the top (Jim and Mike have to believe these are important and embrace them).

By giving up control of the hardware RIM also runs the risk of hardware variances conflicting with the whole user experience from model to model. For example, I may love an HTC BB but hate the Samsung BB.

The problem you are now seeing, and why RIM should be afraid, is that the revenue generated by recurring revenue streams (software) is eroding fast. Companies are abandoning ship now and going to Apple and Android where they can avoid BB Ent software, licenses, etc. I am taking my company that direction and saving big bucks per year. Our business partner did this too, with their company, abandoning RIM and saving tens of thousands per year by using iPhones for all employees.

**elvin1983** · 11-11-2011, 08:19 AM

Originally Posted by rmjones101

I guess I my question would have been more accurately phrased as "licensed" instead of contracted. Yes right now they have software issues during the conversion to BBX. However, prior to the change to BBX, the biggest issue the consumer had with BB was most definitely the hardware. It would take forever for newer devices to release that had any significant advancements compared to it's respective preceding models, which would then turn out to already be considered aging hardware upon release anyway. And not just aging hardware issue, but also that RIM has had their fair share of bombs with devices like the Storm/Storm2.

But my question was under the supposition that BBX is finalized/stable and ready for public consumption (and thus the current software issue being fixed). Licensing out to other manufacturers would allow for competitiveness in hardware design for consumers who prefer the BB platform.

See, I don't think that contracting out hardware manufacturers to make BB handsets is going to make the devices more competative from a hardware standpoint. Hypothetically, if RIM contracted Samsung to make BlackBerry handsets (which would make me cry) they would still want to control what the hardware specs of the devices would be. Processor, battery, memory, screen resolution, etc. RIM wouldn't just hand the keys to the hardware over to another company and say "You guys just go ahead and build whatever hardware you want, and we'll slap BBOS/BBX on it." By licensing out the hardware design, I think RIM would be shooting themselves in the foot (and by foot, I mean the only one they currently have to stand on).

I also think they need more effective advertising. To date, I haven't seen a single ad for the Bold 99XX series, not a single one. I have yet to see an advertisement for the Torch 9850/60. Yet, I see countless Android and iPhone ads all the time. RIM has got to get in front of the ball with BBX and it's new devices and launch a comprehensive advertisement campaign to get people talking. I've shown a number of people my 9930, and they couldn't believe that it had a touchscreen. They hadn't heard a thing about the device, and that's a problem. I've had a ton of people ask me about the Galaxy S II, but only a couple ask me about the new BlackBerry. They've got to do better at getting their name and product out there.

And to humor the idea of a 3rd party handset manufacturer making BB handsets, the only ones that I think would be ok would be HTC or maybe Motorola. Samsung handsets have great screens, but that's about all in my opinion. They feel like they're made with the cheapest materials that could be found. You couldn't buy me a Samsung handset, I'm always afraid I'm going to break the battery cover or something every time I pick one up.

**zgods1** · 11-11-2011, 09:43 AM

I don't think so. in short I think it would be the worst choice for them. I think it would kiill blackberry off completely! But definately an interesting topic!

**Powdah** · 11-11-2011, 10:02 AM

RIM needs some out of the box thinkers. I have been a loyal BB user, but know after watching the Droid world evolve, I am on the fence. Look at the Galaxy Note. It is a device that actually fits a model that many of us business users want. At least Samsung is pushing the edges.

RIM is barely hanging on with what they call cutting edge. I would really like to see something really cutting edge. Something that makes me want to stay with RIM.