socialmedian: Microsoft and RIM? I Don't Think So.

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Submitted by Dobata from Google Reader

Oct 11, 2008

Summary

By Mona Nomura of Pixel Bits (FriendFeed/Twitter)

There's speculation of a possible Microsoft-RIM marriage. It sounds appealing, but highly unlikely. Steven Hodson points out, Microsoft has never been in hardware. I agree hardware is a factor, but the bigger question is: can a MSFT-RIM team compete in the Mobile Market?

(Pie chart via jkOnTheRun. Thank You!)
In 2007, the mobile world was heavily Symbian dominated at 57.1% of the share. WinMo was 2nd, with 11.5%, followed by RIM at 8.9%. Currently, the leader board is Symbian = 57.1%, RIM = 17.4%, and WinMo = 12%. In just one year, RIM shot past Microsoft with a 126.4% growth rate.

Phenomenal.

If MSFT and RIM merged, they would take 29.6% of the market, and still be only half of Symbian - with two separate platforms. RIM's number one selling point is its push mail and server. As Electronista points out, server integration would be a potential nightmare. With iPhone's increasing momentum, would Microsoft and RIM risk potential loss while the integration takes place? Not to mention, RIM's co-CEOs are heavily inv ...Read the full article

Comments (7)

Robdiana,

Oct 11, 2008

I agree that RIM would not make sense for MS, but they have always dabbled in hardware. They have keyboards, mice, Zune, XBox and older stuff like a web tv appliance. They just have had marginal success with it.

Asteele,

Oct 12, 2008

I think this has been in the works for years and the current dip in valuations will make it possible to get a deal done.

Thomaspower,

Oct 12, 2008

Oh yes I do.

Mona,

Oct 13, 2008

@Asteele: If this has been in works for years, how would you explain MSFT's recent acquisition of Danger? I'm pasting what I wrote in the comments of LG's blog:

"I remember that news and it's still bizarre to me. Danger is a platform that runs on Sharp and Motorola, so MSFT's need for more software was confusing. The only two reasons I came up with were: 1. backend. Danger's servers and email system, perhaps. and 2. Zune phone. -- which still doesn't make sense since Zune has still yet to move to MSFT's PlayReady DRM. Unless MSFT isn't planning to migrate Zune to PlayReady, which wouldn't make even more sense (imo).

Considering MSFT's history, the current market, their current state, and WinMo licensees, it's unlikely we will see a MSphone in the near future. So I am curious as to what (if anything) they have in their pipeline. :)"

Asteele,

Oct 13, 2008

@Mona - agree the Danger acquisition muddies the waters but let's talk numbers here - there is a big difference between Danger (~ $500M valuation) and RIMM (~ $50B valuation until very recently) - we're talking 100x bigger deal. MSFT can afford to do the former basically as an R&D investment. the latter is a move to take a major share in a market where they have been losing to date with their own efforts.

Jasongoldberg,

Oct 13, 2008

@asteele well put. I could see MSFT being an agressive acquirer now as the are sitting on all that cash while equity values are getting squashed.

Mona,

Oct 13, 2008

By the time they complete the research and move on to development, they'd have to do more R&D on going Open. Android is doing better than expected (1.5million pre-sold, did you see the news?), iPhone's momentum is not slowing down, at this rate a RIM-MSFT team wouldn't make any sense. Plus, I doubt the co-CEOs would allow it to happen. But that's just me. :)

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