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RIM CEO: We're Not in a Death Spiral

To the average consumer, it may look as if RIM is crashing in flames, ejecting thousands of employees, discontinuing products and stalling its new lineup until next year. Even one component supplier has decided to jump the BlackBerry ship. Needless to say, things haven't exactly been peachy keen for RIM over the last several months, and may have RIM customers wondering what will become of their own devices in terms of support in the near future.

Yet despite recent events, the company isn't in a "death spiral," or at least that's what RIM CEO Thorsten Heins said in a radio interview with Canadian Broadcasting Corp's "Metro Morning," a local radio show in Toronto. He admitted that his Ontario-based company is facing very big challenges, but he feels that it will emerge successfully from the transition it's currently enduring.

"There's nothing wrong with the company as it exists right now," Heins said. "I'm not talking about the company as I, kind of, took it over six months ago. I'm talking about the company (in the) state it's in right now."

After reporting horrendous losses last quarter, the company said that it was delaying the launch of BlackBerry 10 devices until calendar 1Q13. The company said that software development teams have made major progress in the development of key features for the BlackBerry 10 platform, but their integration and the associated large volume of code added to the platform has proven to be more time consuming than anticipated, thus the delay.

Given that revenue for the first quarter of fiscal 2013 was $2.8 billion, down 33-percent from $4.2 billion in the previous quarter, the delay had to have been a tough decision to make. Last week, Heins said the company's top priority going forward is the successful launch of its first BlackBerry 10 device. And while the company seemingly needs a product refresh in the near future, he said RIM will not compromise the product by delivering it before it is ready.

"This company is not ignoring the world out there, nor is it in a death spiral," Heins told the CBC on Tuesday. "Yes, it is very, very challenged at the moment -- specifically in the U.S. market. The way I would describe it: we're in the middle of a transition. All that is in the making, it's in the works. This company is in the middle of it and I'm positive we will emerge successfully from that transition."

Can RIM ride out the storm? The company has another six months before it plans to release the next wave of BlackBerry devices. Unfortunately, the size of RIM's previous quarter loss and the likelihood that sales will continuously drop as the company slides into 2013, may severely reduce RIM's options.

In RIM's previous quarter, approximately 59-percent of the revenue was generated from hardware, 36-percent for service and 5-percent for software and other revenue. 7.8 million BlackBerry smartphones and approximately 260,000 BlackBerry PlayBook tablets were shipped during the quarter, the company said.