Research in Motion (Nasdaq: RIMM) reported that its co-CEOs Jim Balsillie and Mike Lazaridis have stepped down. The beleaguered Canadian device maker said Balsillie and Lazardis will be replaced by former COO Thorsten Heins.
“There comes a time in the growth of every successful company when the founders recognize the need to pass the baton to new leadership. Jim and I went to the board and told them that we thought that time was now,” said Lazaridis in a press release.
Heins has great challenges ahead both in attempting to boost RIM’s sagging shares price and trying to regain a loss of precious market share.
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According to a recent Gartner report, RIM lost .1% market share beween the the third quarter of 2010 and the third quarter of 2011, holding 2.9% of the total mobile device market at the end of Q3 2011. Nokia led the market with 23.9% marker share, followed by Samsung (17.8%), LG Electronics (3.8%), Apple (3.9%) and ZTE (3.2%).
In the smartphone market, Gartner found that Google’s Android operating system held 52.5% of the market, benefiting from more mass-market offerings, a weaker competitive environment and the lack of exciting new products on alternative operating systems such as Windows Phone 7 (Microsoft accounted for 1.5% of market share) and RIM, that had 11% of market share. Nokia’s Symbian OS controlled 16.9% market share, while Apple’s iOS held 15%.
Heins said that RIM has a strong foundation on which to build. “We have a strong balance sheet with approximately $1.5 billion in cash at the end of the last quarter and negligible debt. We reported revenue of $5.2 billion in our last quarter, up 24% from the prior quarter, and a 35% year-to-year increase in the BlackBerry subscriber base, which is now over 75 million,” he explained in a statement.
While losing his position, Lazaridis said he remained confident in the company, noting that he intended to purchase $50 million in company stock on the open market.
Heins strategy includes recruiting a new chief marketing officer to work closely with company’s product and sales teams. “Going forward, we will continue to focus both on short-term and long-term growth, strategic planning, a customer- and market-based product approach,” Heins said.
Previously, Heins served as COO overseeing the BlackBerry smartphone portfolio worldwide. Prior to joining RIM in 2007, Heins held several positions in the wireless arena including CTO of Siemens’ communications division and several GM positions in hardware and software businesses.
Lazaridis, former co-chair and co-CEO, has become vice chair of RIM’s board and chair of the board’s new Innovation Committee. Jim Balsillie remains a member of the board.
RIM also named Barbara Stymiest, who formerly served as a member of Royal Bank of Canada’s Group Executive and has been a member of RIM’s Board since 2007, as an independent board chair. John Richardson, formerly lead director, will remain on the board. Prem Watsa, CEO of Fairfax Financial Holdings, also was named to the Board, expanding it to 11 members.
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