Research In Motion

The rumours are flying today, folks.  Several media outlets are regurgitating a story from British newspaper, The Sunday Times, saying that RIM is considering a split into two business units.

I’d love to read the actual article (and post a link to it here), but it’s behind a paywall, and I’m not a subscriber.  So I’ll make do with the summaries written by Reuters and others.  The problem here, of course, is that summary articles get distorted and I don’t want any part in screwing up whatever the Sunday Times actually wrote.  So, if anyone has the original, please send it in and we’ll have a look.

The crux of the story seems to revolve around the possibility of RIM separating its handset business from everything else.  So let’s talk about this concept, because there are a bunch of fine points to explore.

First of all, creating a new business unit or carving off part of the business into a a new business unit does not mean a transaction is pending.  Sure, it can mean this. But I’ve seen plenty of business reorganizations that did not lead to transactions.  Thorsten Heins may simply have decided that the network operations business should be free to evaluate other business opportunities without being tied to the hardware business.

I’m also puzzled by the idea of RIM carving off JUST the hardware business.  To me this makes no sense at all.  I don’t see the hardware business being worth much on its own, and I don’t see why anyone would want to buy it.

Facebook and Amazon are being tossed around as potential buyers.  Again, I can’t see why Facebook would buy a hardware business at this point.  If they had an OS they wanted to run on their own hardware it isn’t difficult to get somebody else to make the hardware for you.  I think it’s much easier for a good software company to get into hardware than it is for a hardware company to get into software.

I can see the point of separating the network business from the handset business, but the handset business needs to include BlackBerry 10.  Otherwise what good is it to anyone?  Microsoft’s move to manufacture its own tablet, along with Google’s move to buy Motorola Mobility underscore the trend towards owning hardware and software under one roof.  Suddenly we are to believe that RIM’s going to sell off its hardware business?  

Nah.  I don’t buy it.

I do think Facebook needs a mobile strategy.  I do think Facebook is a natural buyer of RIM (the whole company) should a deal be struck.  And I have always thought Amazon was a potential buyer if they wanted to own an entire platform rather than leveraging Android.  But those possible outcomes really have nothing to do with RIM carving off the hardware business.