1. anon(55900)'s Avatar
    I'm surprised this hasn't been kicked around more, a hugh part of what is happening to RIM and many other companies right now is indeed due to the global economy.

    Stock holders are frantic and trying to consolidate their stock holdings into sure things (if that's at all posible).

    Major shake ups and weak but not bad companies fail during these times.

    The fact that RIM is still even around still is amazing considering what's going on world wide.

    They were blessed with the 2 billion in the bank and I hope, 1. The economy gets better and doesn't double dip and 2. RIM can weather the storm and still be afloat whenever it finially calms.
    08-14-12 09:25 AM
  2. cgk's Avatar
    I'm surprised this hasn't been kicked around more, a hugh part of what is happening to RIM and many other companies right now is indeed due to the global economy.
    No - yes, there is a recession and yes there is expected to a slowdown in mobile sales towards the end of the year but the market itself has performed - "it's the economy!" is an excuse given the success of Samsung and Apple. The recession has nothing to do with the fact that their margins have collapsed and they missed an innovation cycle.
    08-14-12 09:35 AM
  3. anon(55900)'s Avatar
    Android and iPhone, easy picks, sell RIM and put into them, My point. RIM issue's are exacerbated by economy.
    08-14-12 09:39 AM
  4. OniBerry's Avatar
    No, RIM's issues were exacerbated by missing dealines and being behind by about two years. Screwing around with a co-CEO model that should have been axed years ago. People haven't stopped buying mobile devices, they have just cooled on BlackBerry. It's a brand thing, not an economic thing.
    GingerSnapsBack likes this.
    08-14-12 09:44 AM
  5. GingerSnapsBack's Avatar
    No, RIM's issues were exacerbated by missing dealines and being behind by about two years. Screwing around with a co-CEO model that should have been axed years ago. People haven't stopped buying mobile devices, they have just cooled on BlackBerry. It's a brand thing, not an economic thing.
    This. You can blame the economy all you want, but RIM sat on their hands when Apple released the first iPhone and then along came the Androids and they again did nothing except release the Storm to compete which as we know failed.
    08-14-12 10:01 AM
  6. kwm1337's Avatar
    I'm a new ECON professor in university here in the states, and granted more of the mainstream economics is not what I teach, I focus on more specialized topic courses, but when I can I like to pull in topics from the real world I enjoy and use them in class even if they are not full case studies...

    I have recently been looking for a hook to grab on RIM in history and recent years to talk about, but so far not much is there for ECON compared to other options...

    However, I can say that some of my colleagues in the Management area & also quite a bit in Finance and Supply Chain have been able to use RIM in class, and it is actually one students enjoy more because everyone has an opinion in that area.

    Anyway I guess my point is more along the lines of cgk, does the recession affect RIM yes. Are their unique problems related to the recession, ehhh, maybe. Certainly the case is hard to make in an academic setting to directly relate RIM uniquely as having economic or econometric-ly related issues, but rather Management, Finance, and Supply Chain issues.

    Anyway just my $0.02[USD], I think this is a great topic for discussion though for any interested.
    08-14-12 10:34 AM
  7. GingerSnapsBack's Avatar
    Anyway I guess my point is more along the lines of cgk, does the recession affect RIM yes. Are their unique problems related to the recession, ehhh, maybe. Certainly the case is hard to make in an academic setting to directly relate RIM uniquely as having economic or econometric-ly related issues, but rather Management, Finance, and Supply Chain issues.

    Anyway just my $0.02[USD], I think this is a great topic for discussion though for any interested.
    As an econ professor, if RIM's troubles are in part due to the recession, how do you explain Apple and Android's sales figures?
    08-14-12 10:46 AM
  8. kwm1337's Avatar
    As an econ professor, if RIM's troubles are in part due to the recession, how do you explain Apple and Android's sales figures?
    With AAPL, many like to simply say that the products have a significant inelasticity to them. Typically when we would talk about elasticity theory we talk about if the price drastically changes do people still demand the same amount [textbook e.g. gasoline]; however, here I am referring more to the fact that in 'theory' the implicit price has changed because explicitly the price of iPhone for example has not changed all too much.

    For example, Alice is making $1,000/week and the iPhone costs $600 (I am not sure what their current price is). To Alice that iPhone costs 60% of her weekly income (just leave out taxes, and assume ceteris paribus for all of this). Going through the recession Alice lost her job, she is now on unemployment now received probably slightly over $600/week. Now that iPhone is almost 100% of her income. The likelihood that she will buy that iPhone is remarkably close in either situation.

    Obviously while this situation above is odd to look at, but we know a few things: 1). Things like that are happening, 2). It does go against the 'homo economicus' or the thought that the man is rationale in his decisions.

    So this shows, indeed, that AAPL is able to maintain sales figures for this specific reason and many others.

    Android manufacturers on the other hand maintain sales figures on Android based phones through a few reasons as well. Many would say that their sustainability and growth is through a Wisdom of Crowds perspective.

    Either way, RIM's BlackBerry products show a considerable amount of strength through loyalty of their customers, much like AAPL, and RIM provides among other things critical infrastructure and services to those with specific requirements.

    So loyalty & necessity help propel RIM.

    To give a summary answer for your original question: AAPL, Android manufacturers, and RIM are probably on more equal footing (ceteris paribus) then most people would think. Overall this industry does not suffer the same high-level affects that other goods & services related industries experience from a Recession like this one...

    What I have said here counts towards answering your question, but it does very little to explain this:


    Which is what I think you are getting at... For that you would not only look at the Management, Finance, and Supply Chain of the companies, AAPL, RIM, and Samsung for example for Androids, but also that of the carriers [and their preferences we know they have], and other related market players.

    Market equity in reality is a great indicator of is something doing well or not, but by far it is a small piece of the puzzle in developed countries.
    08-14-12 11:24 AM
  9. anon(55900)'s Avatar
    No, RIM's issues were exacerbated by missing dealines and being behind by about two years. Screwing around with a co-CEO model that should have been axed years ago. People haven't stopped buying mobile devices, they have just cooled on BlackBerry. It's a brand thing, not an economic thing.
    Its both, but the economy is making it much, much more difficult as excess cash in average families falls.
    08-14-12 11:48 AM
  10. OniBerry's Avatar
    Its both, but the economy is making it much, much more difficult as excess cash in average families falls.
    If that were true, then we would have noticed a more uniform decline in total device sales, and not weaker sales for some and stronger for others.

    Again, the Earth is larger than just North America (I know we don't like to think so), so whatever financial crisis is hitting smartphone sales in the US/Can/Mexico does not translate into the same numbers in Asia or Europe.
    Last edited by Oniberry; 08-14-12 at 12:07 PM.
    08-14-12 12:03 PM
  11. Laura Knotek's Avatar
    Its both, but the economy is making it much, much more difficult as excess cash in average families falls.
    Cuts are being made, but in different areas.

    I have a friend who teaches at a community college. He has observed that students from lower-income families typically have Android devices on prepaid plans. This is the sole means of accessing the Internet for many of these students. They and their families typically do not have computers and/or broadband Internet service at home.
    08-14-12 12:06 PM
  12. jacobhwrd's Avatar
    I left BB for an iPhone when the iPhone 4 came to Verizon. I did his for a few reasons. BB feels extremely outdated. And yes I had the BB bold as soon as it was released so don't try to troll and say I didn't have a good phone. The phone was amazing in everything it was known to do but when it came to the little extras......that is where RIM fails miserably. The web browser is for lack of a better/cleaner word garbage. The phone is geared towards business. But everything that they do you can have on androids an iPhones. Why would I spend the same amount of money on a phone that can do less?!?! Many companies are offering iPhones and androids in place of BB as their work phones. I know mine does and while I can not say who it is I can say they have ~10k employees so they already see how much more the other phones have to offer. My point is that if RIM insists to not keep up with what the market wants then they will be left behind.
    Last edited by jacobhwrd; 08-14-12 at 01:43 PM.
    08-14-12 01:39 PM
  13. kwm1337's Avatar
    I always like a good discussion like this, many of you bring great perspectives from your own vantage points.

    I think ultimately this allows some who may not have opinions or views yet, but would like to, receive assistance in seeing everything there is before making up their mind about this topic.

    @lak611: Your friend definitely has it spot on. I assume watching a community college or University's population gives a great microcosm view of what is going on... Everyday exactly what you described is so evident, and I have had to begin to think about that because within reason I have to expect students to do research and more and more particularly those students who commute to University have only one stable source of internet. Their phone... [and then everyone has access to the University of course]

    @jacobhwrd: While not an economic point, your views into management is an interesting one. Will IT admins, Security Professionals, the average employees like the BYOD? There are pros and cons for all involved... I think we will see a standardization of said policies by industry. For example defense industry may stick more to RIM & AAPL, where whereas retailers may go toward AAPL & Android products...

    @mawil1013: When you said "It's both" your spot on. I think it is always important to recognize that there is no one answer fits all here. This question has so many dimensions to it, that I like the idea [at least what I understood] from your original post: There is so much going on here that regardless of anything that happens RIM is still around, neither RIM's liquidity or solvency has ever been questioned, RIM has many things still, and because of this RIM does stand apart from many business in the short recent history of this globalized economy.

    I think when people, besides useless trolls, on here complain about RIM or certain parts of RIM, or BlackBerries I get the feeling they are complaining about whether RIM or a BlackBerry device is jockeying for #1, #2, or #3 in the world.

    Regardless, I love me a BlackBerry! Cheers to RIM!
    08-14-12 02:45 PM
  14. berklon's Avatar
    RIM is part of the same economy Apple and Samsung are.

    RIM is in the trouble they're in because they didn't keep up with the competition. It's as simple as that.
    08-14-12 02:54 PM
  15. kwm1337's Avatar
    RIM is part of the same economy Apple and Samsung are.

    RIM is in the trouble they're in because they didn't keep up with the competition. It's as simple as that.
    No, they are in the same sector of the economy, but most certainly they do not stay exclusively in the same industrial portions...

    But assuming it really was "as simple as that", there would be no ability for RIM to 'turn around' per se... You must ask, if your opinion is "they didn't keep up with the competition", Why did they not keep up with the competition? What areas did they fail? What areas did they succeed?

    There are answers to all of those questions, and they are important answers, and there are more important questions as well, and that is what we are digging at...
    08-14-12 03:01 PM
  16. cgk's Avatar
    I'm a new ECON professor in university here in the states, and granted more of the mainstream economics is not what I teach, I focus on more specialized topic courses, but when I can I like to pull in topics from the real world I enjoy and use them in class even if they are not full case studies...

    I have recently been looking for a hook to grab on RIM in history and recent years to talk about, but so far not much is there for ECON compared to other options...

    However, I can say that some of my colleagues in the Management area & also quite a bit in Finance and Supply Chain have been able to use RIM in class, and it is actually one students enjoy more because everyone has an opinion in that area.

    Anyway I guess my point is more along the lines of cgk, does the recession affect RIM yes. Are their unique problems related to the recession, ehhh, maybe. Certainly the case is hard to make in an academic setting to directly relate RIM uniquely as having economic or econometric-ly related issues, but rather Management, Finance, and Supply Chain issues.

    Anyway just my $0.02[USD], I think this is a great topic for discussion though for any interested.

    I am a management Prof (UK - I concentrate on the mobile sector) and I've used RIM quite a lot recently - them and Nokia make great case-studies.
    08-14-12 03:04 PM
  17. kwm1337's Avatar
    I am a management Prof (UK - I concentrate on the mobile sector) and I've used RIM quite a lot recently - them and Nokia make great case-studies.
    Ah, Nokia is great for such case studies! I have been able to use Nokia a few times for its location in the eurozone & wide usage of eurocurrency, a Canadian company does not allow for such case uses in economics as well as Nokia or Samsung...

    EDIT: I realized for some who are interested in looking at this information to be able to compare aspects of RIM to what is going on globally & with competitors, I should state that by eurocurrency I do not mean the Euro. While Nokia is located in the eurozone and uses Euros, eurocurrency refers to any one who places their native currency in a foreign institution. I mention this only because RIM has a sizeable amount ~$2 Billion [USD] in cash, and that money is in various denominations deposited where they find it suitable. The way that cash is handled as cash has a large affect on their use of it and its intrinsic value.
    Last edited by Berry_Intelligence; 08-14-12 at 03:27 PM. Reason: Extra Information
    08-14-12 03:14 PM
  18. raino's Avatar
    RIM is part of the same economy Apple and Samsung are.

    RIM is in the trouble they're in because they didn't keep up with the competition. It's as simple as that.
    Well, Apple may not be immune to this recession either:

    Apple Stores reportedly in the midst of ‘significant layoffs’ in U.S., Canada and U.K.
    08-14-12 05:38 PM
  19. jacobhwrd's Avatar
    Yes I have to agree. I am enjoying reading this thread. It isn't turning into anyone trying to bash anyone else but just ppl calmly explaining their views and points. Hard to come by these days.
    08-14-12 05:50 PM
  20. SK122387's Avatar
    There's the recession, but that hasn't stopped iPhone and Android from continuing to explode. The bottom line is, people are going to FIND money to buy something they really really want. RIM just has to make a phone that people are going to FIND the money for.

    When I say "find," I mean take money that you'd usually spending on other stuff, and put it towards whatever it is you want to buy.
    08-14-12 06:48 PM
  21. berklon's Avatar
    Right, nobody is immune to the recession.

    But everyone was doing business in the same recession, so you can't blame the recession for RIMs failures when their competition succeeds during the same timeframe.
    08-14-12 07:05 PM
  22. raino's Avatar
    Agreed. RIM's current situation was exacerbated (not caused) by the recession and the Osborne effect, but it's hitting others too now.
    08-14-12 07:13 PM
  23. kwm1337's Avatar
    Yes I have to agree. I am enjoying reading this thread. It isn't turning into anyone trying to bash anyone else but just ppl calmly explaining their views and points. Hard to come by these days.
    I find this great as well! People are reading and commenting in true forum fashion! This is the CrackBerry Nation I've been reading in the past years!

    I know I wasn't the OP, but I really appreciate everybody making comments because I genuinely find this type of conversation fascinating to hear these opinions! If any reading this have more please share!

    Thanks CrackBerry Nation!
    08-14-12 09:27 PM
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