OK, gang, let’s not panic. Microsoft may be thinking about buying RIM if the stock slide continues. This is potentially a market changing move. (And, it may trigger some kind of anti-competitive issues, but we will let the lawyers decide that). In 2Q 2008, RIM surpassed WinMo in market share, and they doubled their market share over the previous year. With the Bold and Storm making waves, I think that the RIM market share is set to add another 50% growth in the coming year. So, what does this potential acquisition mean for Microsoft? First, it would give them a growth juggernaut, something that WinMo hasn’t been in the past 12-24 months. Interestingly, the software strategies of the companies have been on a collision course. MS has been honing the mobile capabilities of Exchange to compete with Blackberry. Owning the Blackberry technology would truly put MS in the mobile e-mail drivers seat. RIM’s recent push into mobile multimedia with their 88XX and beyond series, have really been making a RIM device a consumer hardware choice, too, not just an enterprise play. Microsoft, too, is pushing ahead as much as possible into the consumer space, with Zune, and other efforts. These guys are rushing for the same space. So, the strategy makes sense for MS (perhaps significantly less so for RIM, but cash is king these days). The piece of this that doesn’t fit, to me, is the hardware component. RIM designed handsets and the Blackberry OS are intertwined. Microsoft isn’t a handset manufacturer. In fact, becoming a handset manufacturer puts them in direct competition with their Windows Mobile licensees. The natural turn of events would be to turn the Blackberry OS into a licensable hunk of software. This seems like an unwieldy and treacherous undertaking that is likely to result in an OS that needs to make compromises in order to be successful. If the handset design falls to outsiders, I can almost guarantee that the cool, immediate, graceful integration that makes a Blackberry a Blackberry will be severely diminished. On the positive side for RIM, suddenly they would have even deeper access to Exchange which can only make their enterprise offering better. Further, I think that some of the issues that RIM has had with Blackberry service failing might be alleviated by a company that has the depth of experience in running large scale operations that Microsoft has. That could be a service boon for RIM lovers. What is your take? I, for one, hope that this never happens. RIM is an innovative company that might get lost inside of MS.

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