14 DAY TRIAL // Canadian mobile phone maker Research In Motion has been rumored quite a few times before to be on the verge of being taken over by Redmond-based software giant Microsoft, and now the same rumors made it back to the headlines. The basis is a very simple one: RIM has seen its shares falling recently, and that would lead towards a possible takeover, in case they continue to fall.
If you were wondering why RIM is doing bad, you should know that some of the latest reports on the mobile phone market have shown that the recent launch of Motorola DROID on Verizon's airwaves have affected the sales of the Canadian maker's handsets. The smartphone market in registering increased competitiveness and it seems that RIM is one of those affected by this state of facts.
According to National Bank analyst Richard Tse, there are great chances that RIM would attract some of the largest industry players around the world. “We can’t help but think that Microsoft could be one of many suitors,” Tse states, noting that RIM is not one of the marginalized mobile phone makers, but that it might attract those who want to enter the smartphone market.
“Sticking with Microsoft, sure Windows Mobile 7 is on its way but wouldn’t RIM be able to offer what they’ve strived to get beyond their OS and Office – another wedge into the enterprise. We sure wouldn’t rule this out,” Tse adds. However, it should be noted that Microsoft has said on several occasions before that it only intends to offer software for the mobile phone market, and that the making of hardware is not in its plans.
As Richard Tse indicates, RIM's valuation has dived 35 percent since late September, a very impressive drop, and which is another reason for large firms to be attracted by the phone maker. Even so, the company has just released on the market a series of attractive mobile phones, and is also expected to soon deliver some other appealing devices that should help it regain its foothold.