Research In Motion, the Waterloo, Ont.-based maker of BlackBerry smartphones, held its annual shareholders’ meeting a few weeks back, and the aftermath of the affair continues to be… the opposite of encouraging. Frontman for the occasion was the company’s accidental kingpin, Thorsten Heins, whose name always strikes me as sounding similar to that of rapper Busta Rhymes — except that the RIM man falls short on content, flow, delivery and other qualities essential to the art-form of getting in front of a microphone; yo.
If only, if only Heins had Rhymes’ gift of charismatic oratory. Here is Busta, rapping through his smash hit, “Why Stop Now”:
We can do anything/
Walk into anywhere and buy anything!/
I’ll be chilling, I don’t worry about anything/
Why stop now? I can have everything!
See, that’s what I’m talking about: Rapmaster Thorsta might have used those very couplets to quell his angry investors, when they started asking all those insolent, unhelpful questions, such as “I want my damn money back” (which doesn’t really seem to be a question, when subjected to closer scrutiny.)
In January with the full touch device/
and the QWERTY coming/
I think we will reinstall faith in RIM.
That’s the kind of lame-o performance that would get you pelted with Zagnut wrappers and empty Vernors’ tins, if you had the temerity to strut that sorry stuff at a def jam poetry slam anywhere near Eight Mile; check it out. But perhaps it’s wrong to place the blame on the tuneless Thirsty for the sins of the people who put him in the job. They would be RIM founders Mike Lazaridis and Jim Balsillie, respectively known to their posse by their Waterloo street-names of “Lizard-puss” and “Silly-B.” Under their stewardship the company became a global leader in smartphones, a reign that continued right up until the day when it suddenly ended.
I remember that day. It was October 17th of last year.
My Blackberry had been delivering e-mail only intermittently, and, like many Blackberry users, I assumed that was some technical thing I had done, or failed to do. Forgot to push the whosis to reset the frim-fram, or something. Then it emerged that I wasn’t the only confused business-user to experience the problem; it was a worldwide technical glitch that turned out to originate at RIM’s command center.
So, along with 60 million other inconvenienced Blackberry-clutchers, I waited for RIM to deliver some form of redress. That might have been the career-capping moment for Silly-B and Lizard-puss to shine, as they offered up a maneuver that would (a) solidify the company’s loyal user base; (b) reposition RIM from its image as a faceless purveyor of bland tech products, to a caring, customer-centric entity more like Apple, and; (c) allow RIM’s 15,000 employees to get back to developing, making, and selling their products.
Well, of course, none of that happened — but the plan enacted by Liz and Sil was so sublimely self-destructive that it will be discussed for decades in graduate business schools (perhaps other than the University of Waterloo, where the subject smacks too close to home, quite literally.)
They identified their product’s main shortcoming (“We have no apps, and the handful we offer are total junk”), and shone a glaring spotlight right in that very place, by offering what was purported to be a hundred-bucks worth of free apps to every Blackberry user. This ploy forced all those 60 million customers, who were already disappointed, to examine the few and farcical app offerings, and then, out of interest, contrast the bare and ludicrous collection with what the competition had to offer. Which, anyone could see, was more than impressive, and starkly revealed the BB as trailing-edge technology.
Far from allaying the users’ unease, this ridiculous offer at compensation drove countless customers into the retail outlets of Apple and Andoid-based phone-makers. None of those ex-BB fans, including your reporter, will ever consider returning to RIM. For all effective purposes, you could record 10/17/11 as the date of the company’s expiry.
Except that some would say the seeds of RIM’s undoing were planted on June 15, 2007. That was the day Silly-B began collecting deposits on season tickets for a National Hockey League team he planned to locate in Hamilton, Ont. for the 2008-9 season. That incident provided more rich fodder for business school seminars, with Sil proving how you can fail by succeeding. He managed to collect down-payments from 12,000 would-be lifetime fans of his team – only to alienate the same constituency when it became obvious that he never had a realistic chance of actually delivering a product.
Four years later, in 2011, he was at it again in his role as co-chair of RIM, when he released the Playbook tabloid without embedded e-mail program, or scheduling software. Once more, RIM was seen as a company that brushed aside its glaring deficiencies, with ill-conceived explanations. Following those missteps has been an astonishing cascade of more missteps, poor calculations, and muffled explosion noises emanating from RIM Central.
Earlier this year, Liz and Sil resigned as RIM’s joint-CEOs. In April, Sil’s private think-tank, the Centre for International Governance Innovation offered, to donate $30 million to York University of Toronto, to establish a program in international law. York spurned the offer, claiming the donation came attached to too many strings, which were controlled, inevitably, by Silly-B. Then RIM’s stock fell to a point where its value has declined by 95 per cent from its 2008 peak. This led the new boss, Tough-talkin’ Thorsten, to tell an interviewer he doesn’t think the company is in a “death spiral.” But certain phrases, and “death spiral” is one, carry a funny resonance, where every syllable that precedes and follows the phrase are forgotten, and the words “death spiral” reach an echoing crescendo that magically never fades.
This morning, Prem Watsa of the Fairfax financial group declared that RIM has hit bottom, as he doubled down, for the second time in 2012, on his position. He tells the Globe & Mail newspaper: “We’ve never seen a technology company with assets and talent of this calibre come down as cheap as the stock of this one has.” [Editorial interjection: Sure you have, chief. Heard of Nortel? Nokia?]
Mr. Watsa continues: “The marketplace seems to be pricing the stock as if the company might simply close its doors shortly… It’s not like this is a start-up venture capital company. There is a world-wide following, significant capital, tremendous talent and singular focus on innovation.”
Mr. Watsa, who enjoys being known as the “Warren Buffett of Canada,” has previously demonstrated his financial acumen, but, just like MC Thorsten, the cat’s poetry fails to close the deal. In other words, he may be worth a billion, but if he’s ever going to see a nickel back from his RIM investment, he’d better start to express himself more in the assertive fashion of rapper 50 Cent:
You goin’ ‘gainst me, dog, you makin’ a mistake, I’ll split ya,/
Leave ya lookin’ like the Michael Jackson jackets wit’ all them zippers,/
I’m the boss on this boat, you can call me skipper,/
The way I turn the money over, you should call me flipper.
But bluster may only serve to get you out of the auditorium with your scalp intact. If you’re seeking to find the coming bottom of RIM’s shares, it likely won’t be the $26 per Mr. Watsa averaged in January, and I’ll stick my neck out and guess that it won’t be the $7 he paid this morning. Instead, we’ll turn again for guidance to Mr. 50 Cent, an entertainer who is also noted as a shrewd money manager, and someone who, in stock-market parlance, might well say: “Regarding RIM, my name also happens to be my stop-loss order.”