Research In Motion (RIM), the maker of the BlackBerry smartphone, is expected to cut 2,000 jobs in the near future. This is about a tenth of its workforce that is expected to be cut due to a slump in sales. Analysts are reporting that this is a result of shares being lost to Apple’s iPhone.
Research in Motion is planning on laying off 2,000 of its employees to “focus on areas that offer the highest growth opportunities.” RIM is expected to have 17,000 employees after the layoffs.
According to analysts, RIM is simply laying off employees to “take care of the expenses and focus on the revenue side. They need to find a way to make consumers get excited about RIM products. At this point they haven’t gotten there.”
RIM Co-CEO Jim Balsillie recently stated that the company would be laying off employees, but 2,000 is significantly more than suggested.
Just recently, Apple posted its third quarter earnings and stated that the company had sold 20 million iPhones in just the third quarter. Compared to a year ago, Apple saw an increase in iPhone sales by 183%.
Now, critics can argue that iPhone sales have nothing to do with RIM’s layoffs, but we disagree. Apple has proven to be a major blow to RIM’s shares as the Apple iPhone continues to increase in popularity while the BlackBerry continues its downward spiral. This need for RIM to “focus on areas that offer the highest growth opportunities” simply means that RIM wants and needs to work on something innovative to overcome the iPhone. RIM needs to come up with something quickly if the company wants to avoid its plummet and become a true rival to the iPhone.
RIM is expected to report its second quarter fiscal results September 15th.