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BlackBerry maker’s CEO: No drastic change needed
Question of the Day
TORONTO (AP) - The new chief executive of Research in Motion said Monday that drastic change is not needed, even as the once iconic maker of the BlackBerry smartphone confronts the most difficult period in its history.
The Canadian company turned the smartphone into a ubiquitous device that many couldn’t live without. But following the departure of Jim Balsillie and Mike Lazaridis, who stepped down as co-CEOs and co-chairmen, Thorsten Heins assumes the chief executive role at a time when Americans are abandoning their Blackberrys for flashier touch-screen phones such as Apple’s iPhone and various competing models that run Google’s Android software.
RIM’s U.S. market share of smartphones dropped from 44 percent in 2009 to 10 percent in 2011, according to market researcher NPD Group. The company still has 75 million active subscribers, but many analysts believe the company will lose market share internationally, just as it has in the U.S.
Heins, formerly a little known chief operating officer who joined RIM four years ago from Siemens AG, replaces RIM’s founders after the company has lost tens of billions in market value. Balsillie acknowledged in December that the last few quarters have been among the most challenging times the company has seen.
Even so, Heins said on a conference call on Monday that he didn’t think significant change was needed. He said the leadership change was not a “seismic” event. Heins said he’s committed to switching the company’s phones over to a new operating system, which is expected late this year. That’s the same plan favored by Lazaridis and Balsillie, who announced Sunday they would step down from the top jobs, but serve in other roles.
“I want us to have a bit more of an ear towards the consumer market, understand trends, and not just do what the Street is telling you,” Heins said.
Shares of RIM fell eight percent, or $1.39 cents to $15.61, following his remarks. The stock had initially moved up almost 4 percent in premarket trading.
Heins said in a telephone interview with The Associated Press that RIM doesn’t have plans “right now” to put the company up for the sale or to split it up. He reiterated there is no reason for a “shake up” of RIM. He explained that he would consult with Lazaridis and Balsille on major decisions because they remain board members.
“I’ve worked really well with Mike in the past. He is a founder of an iconic company, a great innovator. For sure, I will seek his advice and his counsel where needed and I will have my discussions with him, but the company is run by the CEO and that’s what you’ll see,” Heins said.
Heins‘ top priority will be to release smartphones that run the company’s long-awaited Blackberry 10 software. “I will do everything I can to make that happen, but I cannot commit to a very specific date. But, yes, we will ship BlackBerry devices later this year on BlackBerry 10,” he said.
Vic Alboini, president of Jaguar Financial Corp. in Toronto, which has been pushing for a change in leadership, said the drop in stock price on Monday meant the market saw the leadership adjustment as “more of the same.”
Many shareholders and analysts have said a change or sale of the company has been needed, but the sudden departure of the two founders from their top jobs wasn’t expected despite their promises that they would examine the co-CEO and co-chairmen structure.
Balsillie and Lazaridis have long been celebrated as Canadian heroes, even appearing in the country’s citizenship guide for new immigrants as models of success. They headed Waterloo, Ontario-based RIM together for the past two decades.
“There comes a time in the growth of every successful company when the founders recognize the need to pass the baton to new leadership. Jim and I went to the board and told them that we thought that time was now,” Lazaridis said in a statement.
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