Analyst Perspective: Leveraging Acquisitions

By  Jeff Goldman — October 01, 2010

This is the latest in a series of interviews with industry analysts, discussing their perspectives on key issues related to BlackBerry devices and the enterprise.

Kevin Restivo is Senior Analyst, Mobility at research firm IDC. A former journalist, Restivo provides strategic marketing and sales research and advice to technology vendors, service providers and end user organizations looking to better understand the competitive and market dynamics of the mobile device, applications and enterprise mobility markets.

Research In Motion's acquisitions of other companies, Restivo says, are consistently pursued with a single goal in mind. "RIM is constantly trying to augment the BlackBerry experience for its users," he says. "And that's true in a variety of different ways... so it acquires companies typically for very different reasons, but always with the goal of making a better BlackBerry."

None of RIM's acquisitions, Restivo says, has been as significant as the company's purchase of QNX Software Systems in April of 2010 (QNX's Neutrino OS powers the recently announced BlackBerry PlayBook). "It's clear that QNX and the Neutrino operating system are going to be the lynchpin of RIM's OS strategy moving forward," he says.

And so the QNX acquisition, Restivo says, will affect much more than just the BlackBerry PlayBook. "You're going to see Neutrino in all sorts of RIM devices, be it tablets or smartphones, so the impact is nothing short of huge... We're starting to get a sense of the importance of this acquisition to RIM, and I would argue it's the most important acquisition RIM has made in its history," he says.

Restivo says RIM's purchase of Viigo in March of 2010, on the other hand, was a more straightforward content play. "Viigo was arguably the most popular application for BlackBerry, so to bring that in house and really exploit the potential of it made a lot of sense for Research In Motion," he says. "There was already a strong working relationship there, obviously, but to bring it in house and pour RIM's resources on it made a lot of sense, as opposed to having Viigo try to fund its own development, which is a lot harder."

That's true, Restivo says, for many of the company's recent acquisitions. "The advantage of bringing these complementary companies to RIM in house is that you can bring RIM's resources to bear and really put the pedal to the metal as far as development... There's usually already a very strong relationship in place and a cultural fit, and they're not big hits to the balance sheet... yet they still help RIM expand in key areas," he says.

The company's September 2010 purchase of some of the assets of DataViz, Restivo says, certainly fits that mold. "It speaks to their core users' needs for mobile productivity... $50 million is a relative drop in the bucket for a company the size of Research In Motion, and well worth it if you're trying to keep people in the BlackBerry camp and keep them happy and more productive, and that's essentially what Documents To Go can do," he says.

Ultimately, Restivo says, it's often quicker and cheaper to buy a company that can fill a hole in your lineup than to develop that functionality yourself. "It's hard to say where RIM is going to take its acquisition direction next, but I would say the major advantage RIM has right now over a lot of companies is that it's quite cash-rich -- so I would expect RIM to continue to buy companies where it's quicker, it's cheaper, and there's a good fit with the company," he says.

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