RIM and Nokia: Can they survive against Apple and Google?

Moderated by Jason Hiner | June 18, 2012 -- 07:00 GMT (00:00 PDT)

Summary: Canada's Research in Motion and Finland's Nokia once owned significant pieces of the global handset market. What are their prospects now?

Matthew Miller

Matthew Miller

Yes

or

No

Jason Perlow

Jason Perlow

Best Argument: No

Closing Statements

What success requires

Matthew Miller

We began our debate by defining success; and if we require that both companies remain independent entities, then I have to argue that they both will be around for at least the next couple of years.

If they cannot get to 10% or more of the smartphone market in that time period, then I have my doubts for long term success.

Regarding Nokia, they continue to push Windows Phone with solid hardware and fantastic applications and services, yet Windows Phone just cannot seem to gain much traction in the smartphone market. With their Symbian PureView device now available and a Windows Phone version coming in the future -- along with the promise of Windows Phone 8 -- I have to believe there is real potential here for Nokia to turn the tide and show success with Windows Phone. It won't be easy and Microsoft and Verizon have to get on board and show their support too.

In regards to RIM, the enterprise market that still uses BlackBerry devices is slow to change and this works to their advantage as they work out details of BB OS 10. If RIM can get BB OS 10 devices running a slick and functional operating system based on QNX out before the end of the year, I think they too will be able to maintain their market share and grow it in 2013.

Insurmountable challenges

Jason Perlow

The stated objective for RIM and Nokia is surviving intact, as independent companies.

While there is no question that both of these former mobile industry giants have technology and intellectual property of value, the difficult truth is that in order to survive intact for the next several years, both need to stage tremendous comebacks.

Over the next year, this is going to involve severe austerity measures (a massive headcount scale-down at both companies as well as asset divestiture) in order to reduce the run rate on cash reserves, as well as a perfect execution of yet-to-be-released products (BlackBerry 10 for RIM and Windows Phone Apollo handsets for Nokia).

Assuming the execution is perfect, we are also making a big assumption that the new products will allow them to distinguish themselves and draw attention to consumers that would otherwise be looking at the products from their competitors, such as Apple and Samsung, who are also continuing to innovate and command a very strong lead in the smartphone and tablet market.

In the case of Nokia, we cannot even be assured that their patron, Microsoft, is fully committed to keeping them afloat, given the company's recent move toward branding their own devices with Surface.

And if RIM's previous performance with attracting developers to their QNX-based PlayBook is any indication of future success with BlackBerry 10 handsets, we could very well be looking at the company's last stand come this fall.

Any way you look at this, the challenges seem nearly insurmountable. 

Can't imagine survival

Jason Hiner

Of all the Great Debates that I've moderated so far, I've never had a harder time picking a winner than I have with this one. As Matt Miller clearly explained, while both Nokia and RIM are facing severe headwinds, the two companies still have assets, cash, and some opportunities they can exploit. Nokia still has Microsoft behind it and RIM is a smaller company with more flexibility and a high-margin software and services business that could eventually carry the company.

On the other hand, Jason Perlow effectively illustrated the fact that both of these companies waited way too long before being honest with themselves about their challenges and taking action. That has left both of them in a precarious position financially where they have to cut costs while simultaneously investing in new innovations that can help dig them out. Unfortunately, neither company has shown signs that they are prepared to become leaders in smartphone devices again.

Ultimately, unless something changes, it's difficult to imagine either of these companies surviving as independent players in the smartphone market 24 months from now. For that reason, I have to side with Perlow.

Talkback

20 comments
Log in or register to join the discussion
  • RIM should survive

    While I hope Nokia dies a painful firey death, for throwing their users "under the Microsoft bus"
    Jumpin Jack Flash
    Reply 7 Votes I'm Undecided
    • Nokia has already died

      Nokia has already died, it is now the New Nokia - 30000 employees less, and parts of the business sold off and services closed/winding down. Thanks to Elop, this New Nokia is 100% reliant on Microsoft, so this New Nokia will survive because of Microsoft's market share dominance.
      I hope RIM doesn't sell out to anyone.
      root12
      Reply 2 Votes I'm Undecided
      • Nokia fine, RIM RIP

        RIM is already RIP, it has nothing to save it, Nokia does, and I know plenty who have bought back in to Nokia after years without them, including myself thanks to the Windows Phone handshake.
        simmomelb
        Reply 4 Votes I'm Undecided
  • Nokia will survive

    The New Nokia will survive because it has sold out to Microsoft. The old Nokia, the pre-Elop-Nokia is gone. I hope RIM can survive without selling out to anyone else. It is also no coincidence that neither Nokia nor RIM is a US company. Nokia has already sold out to a US company, will RIM do so too? If so, there will only 3 mobile OS's by 3 US companies of any significance, iOS, Android, Windows. A change from only just 3 yrs ago.
    root12
    Reply 6 Votes I'm Undecided
    • Some of the old Nokia dug am undersea tunnel and escaped to Jolla!

      Maemo/MeeGo is where Nokia was going (as a replacement for Symbian) and where Nokia would have gone if the shill from Microsoft hadn't arrived to burn the corporation to the ground.

      But now, many of the old Maemo/MeeGo folks have set up shop as Jolla and they claim they'll have their first phone out by the end of the year; here's wishing them luck!

      And with regard to the debate, I'm not sure I understand the question: what exactly constitutes survival? I don't believe either company will exist much longer as a free-standing entity, but they'll both survive as captives of some other entities. With RIM, it will probably be an outright acquisition. With Nokia, well, they may just continue to be infiltrated by Microsofties to the point where all the milk is going to Redmond even if Microsoft never outright buys the cow.

      I guess that's a "No".
      Atlant
      Reply 1 Vote I'm Undecided
      • Intel's money

        Nokia should have taken Intel's money. They are desperate for an 'in' to the mobile marketplace*, and they were already a key Nokia partner as they throw their Moblin mobile technology into the Maemo bucket that spawned MeeGo.

        *irony is 10 years ago the top mobile processor was the Intel Xscale ARM, as seen in iPaq's and Axim's across the world, and they flogged it to Marvell to push x86 mobile.
        neil.postlethwaite
        Reply Vote I'm Undecided
    • I find it strange that....

      both RIM and Nokia are non-US based tech companies who were at the top of their game. Would this happen if they were both American companies? But I also think that Europe and Canada also need to step up and save their baby by BUYING more of said mobile devices. Why the fcuk would you want to be DEPENDENT on US tech companies -- with all the NDAA/SOPA Police State mentality going on by sociopathic US politicians -- when it's economy is in decline?? Better to eat your own dog food. No??
      maxtheitpro
      Reply 1 Vote I'm Undecided
      • Ok....

        If you had any common sense you would know that the US economy is doing better than Europes is right now and you'd also know that Canada and the US are so similar you cant even tell when you leave one and enter the other, its like england and wales... And our politicians arent all crazy
        Jack Patterson
        Reply Vote I'm Undecided
        • And I am for yes...

          I admire both companies
          Jack Patterson
          Reply Vote I'm Undecided
  • Correction:

    The real question is can they and Apple survive against Microsoft?

    ZuneResurection.blogspot.com
    Ballmerfeld
    Reply Vote I'm Undecided