Turbulence: BlackBerry maker, Research In Motion is struggling – delays new release, to cut 5,000 jobs

by Chi Ibe

BlackBerry maker Research In Motion has announced that it will delay the launch of new phones deemed critical to the company’s survival and revealed its business is crumbling faster than thought.

It was shocking news to BB fans today when the Canadian company posted results for its latest quarter that were worse than analysts had expected. It is cutting 5,000 jobs and unexpectedly delaying the launch of its new phone operating system, BlackBerry 10, until after the holiday shopping season.

According to the Press association, after several delays, the first phone with BlackBerry 10 was expected later this year. RIM chief executive, Thorsten Heins said it will be delayed even longer, to the first quarter of next year. The delay comes as North Americans are abandoning BlackBerrys for iPhones and Android phones.

RIM was banking its future on the new BlackBerry 10 system, which is meant to offer the multimedia, internet browsing and apps experience that customers now demand but experts had said the new BlackBerrys will come out too late to reverse RIM’s fortunes and as predicted,  it will come out months after a new iPhone is expected to be released.

The job cuts are part of a previously announced initiative to cut one billion dollars in annual costs this year. They represent about 30% of RIM’s workforce of about 16,500.

“It is necessary to change the scale and refocus the company,” Mr Heins said. “I fully understand the impact a workforce reduction of this size has on our employees and the communities in which we operate. I assure you that we wouldn’t move forward with a change of this size if we didn’t think it was critical for our future.”

Yesterday, Heins said timetable simply was not realistic to actualise his promise to do everything he could to release BlackBerry 10 this year. He said RIM’s top priority remains a successful launch of the new BlackBerrys.

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