Analysts meet RIM’S new chief
Heins’ methodical style notably different from testy Balsillie
At a cocktail hour in downtown Toronto Thursday, Research in Motion CEO Thorsten Heins sat down with a group of stock analysts for a question-and-answer session about his vision for the firm’s future.
It was as much a sales job as an information session, say analysts who were at the meeting.
And part of the Waterloo-based Blackberry maker’s efforts to win over not just consumers, but the investment community.
“You have to face the music. They have to address the market, and they did,” said Peter Misek, a technology analyst at Jefferies and Co. who attended the meeting, along with another 15 to 20 people.
“Thorsten was honest. He was very methodical. When he disagreed with something someone said, he’d say I` respectfully disagree.’ ”
In contrast, former CO-CEO Jim Balsillie, who stepped down almost two weeks ago, would sometimes have testy exchanges with analysts during conference calls or meetings.
Another analyst at the meeting was also impressed, adding, “Thorsten actually answered most ques- tions compared to Jim’s banter.” But while Misek appreciated Heins’ style, he wasn’t won over by his sales pitch. In a research report entitled “We want to believe . . . but just can’t yet,” Misek downgraded RIM from “hold” to “underperform,” and slashed his price target for the firm’s shares to $15 from $17. “I like Thorsten. I just happen to disagree with him,” Misek said. What Heins was selling, largely, was the idea RIM won’t be licensing its software out for use on competing smart phones — at least for now. Instead, the company will be waiting to see how its new BB10 operating system does when released, likely later this year. There have been plenty of suggestions RIM would be better off licensing its software to companies like Samsung for use on Android phones, or even to Apple for use on iphones, than keeping it only on Blackberrys. “RIM thinks they can get a better deal if it’s a successful system,” said Misek, who believes the company should go ahead with licensing as soon as possible to keep its share of the lucrative corporate communications market.
His report also states RIM is making a mistake by going on a marketing push before BB10 is available.
“RIM appears to be stepping up its marketing efforts, but we believe higher marketing spend without compelling products is not a recipe for success,” Misek said.
The wait and see attitude on licensing likely isn’t RIM’S choice alone, argues Richard Tse of Cormark Securities, who called the meeting with Heins “neutral.”
“If you’re a handset manufacturer, why would you engage that system before you even know for sure if it’s going to be the real deal or not?” said Tse, referring to RIM’S longawaited Qnx-based BB10 operating system.