Great Case Competition

Research In MotionProject BlackBerry Motion
Katrina Constantine
Jacob Markel
Teresa Minchala
Veronique Nadeau
Phong Sam
Matthew Selva
“Always On,
Always Connected”

Outline
Mission
SWOT Analysis
Sustainable Competitive Advantage
Issues and Problems
Strategic Recommendations
Fallout
Conclusion

Research In Motion
Corporate Office: Waterloo, Ontario Canada
Employees: 8,400 by 2008
Additional Offices Located in:

Fort Worth, Texas
Europe
Asia

RIM at year-end 2009

Total Assets of $8 billion
Total Revenue of $11 billion
Net Income of $1.9 billion

The BlackBerry Line
Users can
Access emails
Make calls
Text message
Use Internet and Intranet
Use applications
RIM has launched many models to satisfy the needs of all mobile users

Mission
Research In Motion’s main focus is to be the leading innovator in
-designing,
-manufacturing, and
-marketing
wireless communication hardware and software products

SWOT Analysis
Strengths

Security, Innovation

Weaknesses

Narrow targeted market segment, Problematic product launches

Opportunities

Product integration, Growth in Credit Card Use

Threats

Competition from existing rivals and new entrants

SCA
Issues & Problems

Recommendations
Create the BlackBerryMotionmobile phone
NFC enabled phone
Increases connectivity and integration
Motion-powered battery
Solves diminishing capacity issues

Near Field Communication
NFC is short for Near Field Communication
NFC rivals & encompasses comparable technologies
NFC is growing exponentially
(130 million phones will integrate NFC by 2011)
Contactless payment
Leverage RIM’s SCA in security

Near Field Communication
Feasibility
Visa “payWave” & MasterCard “PayPass”
Successful trials in Atlanta, New York, and San Francisco
Contactless payment in phones exist in Japan, Malaysia, and Europe

Additional Use Demo

Kinetic Energy Battery
The energy gap is widening
Solution: collaborate with Motion 2 Energy
Releasing battery in less than a year
Achieve mobile freedom (power anytime/anywhere)
Feasible
Technology exists
M2E is looking for
qualified
partnerships

Kinetic Energy Battery
Potential Risks
New-to-the-world technology
Unknown long-term effects
Potential Benefits
Already being tested successfully in the military
Environmental impact
Improvements in technology
Set the new standard

Project Cost
Initial Investment: $521 Million
15% of forecasted PPE in 2010
Selling and Administrative expenses
NWC covers 15% increase in Inventory

Generating Capital for The Motion
Internal Financing
High tech firms normally reserve cash
(Cash: $835 Million at Y/E 2009)
Sell portion of short term investments
(ST Investments: $682 Million at Y/E 2009)
Equity Financing
Issuance of common shares
RIMM (NASDAQ) is well known
Very small impact on individual shareholder wealth
Joint Venture
Third-party sharing agreement
RIM partners with parties involved in
the Motion’s development

Projected Sales

Profitability
Gross Profit Margin (per unit): 32%
NPV: $275 Million

Internal Rate of Return: 44%
24% over hurdle rate
Payback Period (Disc.): 2.33 years

Net Income growth of 23% after Year 1

Project Time Frame
Two Year Development Process

Strategic Initiative Evaluation
Effect on growth (Change in Net Income)

38% growth during 2011, original forecast of 10%
21% growth during 2012, original forecast of 5%

Inline with Mission
Maintain LTSCA
Feasible – current technology
Risk

Porter's Competitive Strategy
Market Scope is becoming Broad

Enterprise and consumer users

Advantage in Differentiation

Security
Product Innovation & Integration

Porter's Competitive Strategy
Lower Cost
Differentiation
Apple
BroadTarget
HTC
Nokia
Samsung
Motorola
BlackBerry
LG
CompetitiveScope
Palm
NarrowTarget
CompetitiveAdvantage

Fallout
Potential Issues

Issues with partnerships
Battery recalls and problems
Safety
Profitability

Solutions
Have similar companies as back-ups
Conduct extensive testing on batteries
Password protection on personal information
Best and worst case scenarios

Conclusion
Expanding Opportunity
Recommendation
Innovative
Feasible
Differentiates RIM
Profitable
Competitive Advantage
Fallout

Questions
&
Answers