| | 06-30-12, 10:30 AM Thread Author #1
RIM cancelling Summer Vacations and Increasing Work Week for QNX Staff
From the Ottawa Citizen:
RIM to Ottawa staff: Go all out
OTTAWA — Research In Motion Ltd. is limiting summer vacations and ordering six-day work weeks for many of its Ottawa staff as it scrambles to push out its much-promised BlackBerry 10 operating system.
Ottawa is the “epicentre” of development for RIM’s upcoming BlackBerry 10 (BB10) devices and software. The company, which this week delivered a bombshell announcement that its next generation of smartphones will be delayed until next year, confirmed Friday that the intensified work hours are due to the focus on getting BB10 out to market.
“The successful launch of the BlackBerry 10 platform, and the delivery of high quality, full-featured BlackBerry 10 smartphones, remains the company’s No. 1 priority; and we’re incredibly proud of the commitment shown by all RIM employees as we work toward this goal,” a RIM spokeswoman said in a statement.
The company is racing to complete quality control and bug testing on the new devices, which were originally expected to be released in the fall. On a conference call to investors Thursday, chief executive Thorsten Heins announced a delay to the release of the devices until early 2013 because making sure the phones work flawlessly is taking far longer than the company had hoped.
“RIM’s development teams are relentlessly focused on ensuring the quality and reliability of the platform and I will not compromise the product by delivering it before it is ready,” Heins said on the call. “Over the past several weeks, RIM’s software development teams have made major progress in the development of key features for BlackBerry 10. However, the integration of these features and the associated large volume of code into the platform has proven to be more time consuming than anticipated.”
Rudimentary test versions of the BB10 hardware have been given to developers over the past several weeks in hopes of enticing those developers to make applications and software for the new phones.
RIM is also offering app developers a guaranteed annual income of $10,000 has also signed deals with universities to teach BlackBerry coding courses.
News of the delay sent shock waves through the developer community Friday.
Posting on the blog of RIM’s vice-president of developer relations, Alex Saunders, a developer who identified himself as Frank George vented his frustration.
“How is it possible that BB10 has got postponed once again? Does anyone at RIM actually believe that existing customers will sit around waiting for BB10 when all the other ecosystems are constantly evolving gaining marketshare?” he said. “How could you and RIM have told us developers for the last few months how close things were, to have got us this excited and then to wait for a quarterly earnings call to bitterly disappoint the only community that will, in the end, make BB10 sing?”
The financial community is also asking questions about the new devices, which are falling further behind rivals such as Apple Inc.’s iPhone and Google Inc.’s Android phones.
“The company is in the middle of a major transition with all bets being placed on the success of the BB10 devices,” said Sameet Kanade, technology analyst with Northern Securities in a note to investors Friday. “We would not be surprised by even further delays in the launch.”
Stephen Li, technology and clean tech equity analyst at Raymond James, shared the sentiment.
“With BB10 now delayed (until next year) while the competition refreshes its lineup … we believe that could set RIM further back on the specs (technology) curve and the possibility of a comeback is rapidly diminishing,” he said in a research note Friday. “With that in mind, we believe at this point a sale is likely needed to unlock value.”
With a majority of potential consumers holding off buying a BlackBerry device in the lead-up to the release of BB10, RIM announced it would need to cut more than 5,000 jobs over the next year in a bid to trim $1 billion in costs.
The company said many of the 5,000 have already been notified. RIM has about 16,000 employees globally, including an estimated around 1,600 in Ottawa.
RIM conducted a round of 2,000 layoffs last summer. The company would not break down the latest layoffs by geographical region and offered no guarantees that it was finished cutting. However, the company said a planned expansion of its Kanata offices would go ahead.
“We plan to finish construction on the facility at 5050 Innovation Dr. by the end of the year. Once completed, we plan to relocate some teams from other facilities to the new building,” said the company spokeswoman.
The new 172,750-square-foot building will complement a recently completed facility at 4000 Innovation Dr. The company owns nearly seven hectares of land in the area. It also recently moved its QNX Software Systems Inc. subsidiary into nearby 1001 Farrar Rd., a 150,000-square-foot building formerly occupied by Dell Inc.
At RIM and QNX locations on Farrar Road and Innovation Drive in Kanata, employees refused to comment on this week’s developments. Employees outside both buildings directed a reporter to public relations staff as they went in and out for lunch and breaks.
“We can’t talk, straight marching orders,” said one employee as he smoked a cigarette outside of the Farrar Road office.
On Thursday the company reported a loss of $518 million during its most recent quarter. The loss compared with a profit of $695 million or $1.33 per share a year ago.
Sales for the three month period fell to $2.81 billion from $4.91 billion.
During the quarter, RIM shipped 7.8 million BlackBerry smartphones and approximately 260,000 BlackBerry PlayBook tablets.
In its outlook, the company said it expects the next several quarters to continue to be very challenging for its business.
The company’s shares closed at $7.51 on the Toronto Stock Exchange Friday, down $1.91 or 20.24 per cent.
With files from Michelle Zilio, Citizen staff
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