Bits Blog: No 'Death Spiral' for RIM, Chief Executive Says

Geoff Robins/ReutersThorsten Heins, chief of Research In Motion.

OTTAWA — The share price of Research In Motion is down by about 95 percent, and the company posted a $512 million quarterly loss last week before announcing a delay in a new phone on which it has staked its future. But in a radio interview on Tuesday morning, Thorsten Heins, the chief executive of the BlackBerry maker, said “there’s nothing wrong with the company as it exists right now.”

After last week’s announcement of the worse-than-expected financial results and the delay of the new BlackBerry 10 line to 2013, several analysts questioned RIM’s ability to stay in business. But during the interview, with the Canadian Broadcasting Corporation, Mr. Heins rejected that analysis as well as suggestions that his optimistic outlook is disconnected from reality.

“This company is not ignoring the world out there nor is it in a death spiral,” he said. “Yes, it is very, very challenged at the moment, specifically in the U.S. market.” He added, “The way I would describe it: This company is really in the middle of a transition. We know what we’re doing; we’re executing on our programs.”

Mr. Heins also announced last week that RIM would lay off about 5,000 of its 16,500 employees. While he said the layoffs would have no impact on the introduction of BlackBerry 10 — a phone and operating system that RIM hoped would again make it an effective competitor in the smartphone market — there were widespread concerns that employees involved in that project would view RIM as a lost cause and start looking for work elsewhere.

This is the second major delay in the introduction of BlackBerry 10. The announcement contradicted earlier, unqualified assertions from Mr. Heins that production of the new phones was on schedule and that they would be released on time.

In the radio interview, Mr. Heins, a former Siemens executive who ran RIM’s handset business until January, blamed the delay on the sheer volume of software that must be processed by RIM’s development group — the same reason he stated in the announcement last week. But he offered no explanation for why that burden was not apparent earlier this year.

“Software development is always a huge task,” he said.

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