CASE ANALYSIS 2: RIM: THE MOBILE OS PLATFORM WAR INTRODUCTION The mobile operating system (OS) market in 2012 was booming, but Research In Motion (RIM), whose BlackBerry OS had made the company the early leader in smart phones, was struggling. The company had lost its leading market share to powerful new rivals in Apple and Google, the company’s most recent big release had failed, and the stock price had crashed. To address these problems the company had appointed a new CEO and this case seeks to explore RIM’s situation and options at this crucial juncture. LEARNING OBJECTIVES Understand two-sided markets, complementarity, platform competition, platform envelopment, innovator’s dilemma. Understand the drivers of value creation in the world’s digital infrastructure/platforms. INSTRUCTIONS Read the case and the Supplementary Notes for Case 2 & 3. You may use the latest information to support your arguments. Limit your answers to 2 slides or 1 short paragraph per question. If you have figures and tables, make them user-friendly (with legends, axis titles). Name the file with your Group ID. Designate ONE member to submit the file to Canvas. QUESTION A Short-term decisions: Complements play a major role in determining the winners in platform markets such as the mobile OS. On the one hand, complements (especially exclusive or specialized complements) help differentiate platforms for potential buyers (e.g. type of OS or apps for cellphone buyers). On the other hand, the more buyers adopt a particular platform (because of ease of use and compatibility), the more attractive the platform is to the complement providers (e.g. iPhone and apps). In RIM’s case, there’s a clear chicken-and-egg problem, which prompts these 2 questions: What specific actions should RIM take to better address the complement-maker side of the mobile OS market? (Strategic alliances, acquisitions, sell out, who and what?) What new functionalities should be added (modified) to the BlackBerry phones and services in order to compete with iPhones and Android phones? Each team will address the above questions in the domain area assigned to you in brackets below. Group 1: Connectivity (Internet Services, mobile roaming) Group 2: Online Services (Entertainment: video, music, gaming, etc.) Group 3: Enabling Technology Services (Cloud-based storage management, file access and exchange) Group 4: Application Services (Instant messaging and Social networking) Group 5: User Interface (Keyboard, web browser, speech to text, voice-activated search, etc.) QUESTION B Long-term decisions: If RIM were to be acquired, what would be the benefits for the acquiring firm and what firm(s) would be most interested in those benefits? (List the benefits and identify the names of the firms). A Harvard Business School professor might have a solution for RIM: “Firms that are vulnerable to envelopment can pursue two defensive strategies: opening the platform to enlist new allies and matching the attacker’s bundle.” If RIM were to consider an Open OS platform (like in Android), which complementary partners and products would you recommend that they consider forming a strategic partnership? Should RIM acquiring the partner(s)? Justify your answers.