Report: RIM Considers Ousting Co-CEOs Lazaridis and Balsillie

Canada’s Financial Post reported Tuesday that BlackBerry-maker Research In Motion (RIM) may soon replace co-chairman and co-CEOs Mike Lazaridis and Jim Balsillie with Barbara Stymiest, an independent director who joined RIM’s board in 2007.

According to the report, the demotion of Lazaridis and Balsille would be part of a larger reorganization devised by RIM’s independent board of directors and spurred by “intense pressure” from the company’s shareholders.

Stymiest, as part of a group of seven independent directors on the RIM board, has been evaluating the the company’s internal structure and is allegedly questioning the “business necessity” for Lazaridis and Balsillie to maintain their roles as co-chairman and co-CEO. Official recommendations for an internal re-organization will be made available by RIM independent directors by January 31, the report said. Upon receipt, the company’s nine board members – including Lazaridis and Balsillie – will have 30 days to respond to the recommendations.

Should the reorganization take place, Stymiest – former head of TSX Group and chief operating officer at Royal Bank of Canada – would server as RIM’s first-ever independent chair.

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The rumored restructure appears to be part of a larger effort to keep RIM’s head above water, as it struggles to compete against mobile giants Apple and Google. The Ontario-based BlackBerry-maker has lost much of its enterprise market share due to the growing popularity of the iPhone, iPad, and Android-based devices in corporate environments.

During its third quarter earnings call last month, the company reported a meager quarterly revenue of just $265 million – down from the $911 million it reported in the same quarter the year prior.

In an effort to grow this number, RIM said during the call that it’s planning to make aggressive promotional pushes. "We are certainly not satisfied with the situation in the US market," said RIM co-CEO Jim Balsillie. "So we are absolutely planning a comprehensive set of marketing, advertisement, and promotional plans. And you are going to see that happen imminently."

By the looks of its online store, RIM wasn’t exaggerating. The BlackBerry-maker has already slashed the prices of its three BlackBerry PlayBook models in hopes of accelerating sales of the struggling tablet brand. The 16 GB, 32 GB, and 64 GB PlayBook will be available for just $299 through February 4. Upon their release in April of last year, the 16 GB was priced at $499, the 32 GB at $599, and the 64 GB at $699.

While a corporate shakeup may bode well for RIM, many doubt a price reduction will be enough to jumpstart PlayBook sales. Tim Shea, CEO of Alpha NetSolutions, a Millbury, Mass.-based managed service provider, doesn’t believe the price point had much to do with RIM’s lackluster tablet sales. Instead, he said, it’s the brand.

"I think the lower price might encourage the curious to invest, but I doubt that price was the primary reason for poor sales," Shea told CRN. "Typically, tablets are spring boarding off their smartphone forefathers. Blackberry has been falling behind as a smartphone, so why would anyone want their tablet? Most won’t even give it a good look, due to the association with BlackBerry."