updated 07:55 am EDT, Fri October 10, 2008
MS May Buy RIM
The recent plunge in Research in Motion's shares may help trigger a takeover by Microsoft, Canaccord Adams analyst Peter Misek says. The financial expert believes that Microsoft has a "standing offer" to buy out the BlackBerry maker at a value of $50 per share and may do so if RIM's recent share decline leaves it significantly below that mark. The company is said by researchers to be independent but potentially open to a deal if made under friendly terms.
Such a move would immediately alter the smartphone industry. While Windows Mobile is significant with about 18 million devices sold using the platform between mid-2007 and mid-2008, a Microsoft buyout of RIM would give it approximately 20 million BlackBerry users plus any additional growth in the future, giving the company a much larger stake in business phones than it has today. In the US, Microsoft is below the top five in the mainstream user space, which has lately been dominated by the iPhone and BlackBerries.
Any deal would nonetheless create integration problems for Microsoft. RIM's signature push e-mail system for BlackBerries provides much of the same functionality as the e-mail component of Microsoft's Exchange system, supplying messages in near real time. A dependency on the BlackBerry system at many businesses would require Microsoft to either code the feature into Windows Mobile or else to continue running BlackBerry OS as a second mobile operating system.
Neither Microsoft nor RIM has commented on the prospects of a deal.