UPDATED 12:00 EDT / JULY 25 2011

RIM’s Downfall: 12 Months of Mounting Mobile Mayhem

Blackberry maker RIM announced Monday that they will be cutting 2,000 employees, and on top of that, it’s chief operating officer is planning to retire.  The company first announced the cut back plan last month in an effort to “streamline operations” amidst growing competition from Apple and other mobile phones running Android. The number of layoffs was said to be a little over 10 percent of the company’s global manpower, and that some 17,000 employees will remain after the plan is successfully carried out.

“The workforce reduction is believed to be a prudent and necessary step for the long-term success of the company,” RIM said. “It follows an extended period of rapid growth within the company whereby the workforce had nearly quadrupled in the last five years alone.”

RIM COO Don Morrison is currently on temporary medical leave, but decided to just go ahead and retire instead of returning to RIM.  He has been with the company for over a decade. Thorsten Heins and Jim Rowan will be taking over his functions, dividing the COO responsibilities. That being said, Heins will be COO for product and sales while Rowan will be COO for operations.

“Don’s presence at RIM will be missed, but our senior management and sales teams had already stepped up to manage Don’s responsibilities since the commencement of his medical leave,” RIM co-chief executives Jim Balsillie and Mike Lazaridis said.

But the more fatal blow on RIM’s troubled management is the departure of top marketing manager Ryan Bidan, who decided to join Samsung instead.  Samsung confirmed the move but said Bidan has not started working for the company just yet.

RIM has been receiving a series of serious blows, especially in the last year. RIM’s attempt at a tablet, the Playbook, has been getting bad reviews, and even its Flash support turned out to be a disappointment, despite rigorous campaigns.

RIM’s shares have been on a downward spiral as a result of the company’s inability to maintain a hold on the mobile market, and analysts said it needs  a “complete restructure and extraordinary makeover” in order to survive.  RIM’s also receiving criticism from the inside, when an open letter published by Boy Genius Reports, purportedly written by an RIM executive, clawed at the company’s culture and demanded its CEOs surrender their positions.

We can also recall how BlackBerry was plagued by security concerns last year, that led Saudi Arabia and United Arab Emirates to ban the use of Blackberry devices because of data encryption issues.  The same thing happened with India. These security concerns led RIM CEO Mike Lizardis to walk out in the middle of a BBC interview, underlining the turmoil RIM was facing on a global scale.  The debacle put BlackBerry in the hot seat, and added to the mounting problems of running a mobile company in today’s market.

RIM has not released any new Blackberry devices since November 2010. The company said they’ve been prepping for a new operating system called Blackberry 7 to be launched next month along with at least 7 new devices, hoping to regain faith in their handsets.

RIM’s shares are tumbling down while Apple’s gained, logging a $7.3 billion profit for the quarter and doubling the previous quarter. CEO Steve Jobs must have a lot of say to the company as it manages to wrestle a competitor (RIM) that’s being headed by two CEOs.


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