RIM 'to cut 2,000 jobs'. Research in Motion, the maker of BlackBerry phones, is preparing for a major restructuring that will see it eliminate at least 2,000 jobs worldwide from its roster of 16,500, Canada's Globe and Mail newspaper says. The newspaper cited several people close to the company saying that the next round is layoffs is planned for around Friday 1 June – a day before the smartphone maker's first financial quarter ends – though some expect the announcement even earlier. One source close to the company told Reuters that the impending layoffs could hit as many as 6,000 people and affect legal, marketing, sales, operations, and HR operations.
"The strategic question is: are you accelerating into a better future or shrinking to a niche operation?" said the source.
A string of high-level employees have departed RIM recently, including global head of sales Patrick Spence, who is set to take a senior job at networked audio company Sonos. Several sources close to the company told Reuters that RIM had been letting more junior staff go for several months in what has come to be known internally as "Goodbye Thursdays", because the cuts typically occurred on that day of the week.
A RIM spokeswoman contacted by Reuters declined to comment on the report. RIM and its new chief executive, Thorsten Heins, are struggling with what looks like a perfect storm of problems.
The BBX 10 software to power a new generation of BlackBerry phones is not expected until autumn, while existing users are abandoning BlackBerry phones for models from Apple or those using Android more quickly than new ones are coming aboard. Added to that, price competition – also driven by the burgeoning number of Android smartphones – is eroding the prices that RIM can charge, putting extra pressure on its finances.
And its PlayBook tablet, launched a year ago, has sold slowly while costing the company billions first in inventory and then in writedowns. As a result, RIM's stock has plummeted so that on Thursday it touched $10.59 (£6.75) – an eight-year low. Though it recovered to $11 on Friday, the company's value has dropped steadily from $60 in February 2011
A RIM spokeswoman pointed to comments that Heins and chief financial officer Brian Bidulka made on RIM's last earnings call about plans to streamline operations and save $1bn in the financial year. RIM reported a fourth-quarter loss in March, when the new chief executive announced the initial steps in a strategic overhaul. Heins took over from longtime co-CEOs Mike Lazaridis and Jim Balsillie in January.
Horace Dediu, who runs the consultancy Asmyco, has repeatedly observed that mobile phone companies that fall into loss – even once – never recover their former position.
He restated the point on Sunday night on Twitter, pointing out that Motorola Mobility had become the latest to fulfil that trend after being acquired by Google. RIM has already been through one round of restructuring. Last July it announced plans to cut about 11% of its workforce, or 2,000 jobs.
"The strategic question is: are you accelerating into a better future or shrinking to a niche operation?" said the source.
A string of high-level employees have departed RIM recently, including global head of sales Patrick Spence, who is set to take a senior job at networked audio company Sonos. Several sources close to the company told Reuters that RIM had been letting more junior staff go for several months in what has come to be known internally as "Goodbye Thursdays", because the cuts typically occurred on that day of the week.
A RIM spokeswoman contacted by Reuters declined to comment on the report. RIM and its new chief executive, Thorsten Heins, are struggling with what looks like a perfect storm of problems.
The BBX 10 software to power a new generation of BlackBerry phones is not expected until autumn, while existing users are abandoning BlackBerry phones for models from Apple or those using Android more quickly than new ones are coming aboard. Added to that, price competition – also driven by the burgeoning number of Android smartphones – is eroding the prices that RIM can charge, putting extra pressure on its finances.
And its PlayBook tablet, launched a year ago, has sold slowly while costing the company billions first in inventory and then in writedowns. As a result, RIM's stock has plummeted so that on Thursday it touched $10.59 (£6.75) – an eight-year low. Though it recovered to $11 on Friday, the company's value has dropped steadily from $60 in February 2011
A RIM spokeswoman pointed to comments that Heins and chief financial officer Brian Bidulka made on RIM's last earnings call about plans to streamline operations and save $1bn in the financial year. RIM reported a fourth-quarter loss in March, when the new chief executive announced the initial steps in a strategic overhaul. Heins took over from longtime co-CEOs Mike Lazaridis and Jim Balsillie in January.
Horace Dediu, who runs the consultancy Asmyco, has repeatedly observed that mobile phone companies that fall into loss – even once – never recover their former position.
He restated the point on Sunday night on Twitter, pointing out that Motorola Mobility had become the latest to fulfil that trend after being acquired by Google. RIM has already been through one round of restructuring. Last July it announced plans to cut about 11% of its workforce, or 2,000 jobs.
