IBM wants RIM's crown jewel -- its enterprise business, report says

Acquisition could provide a boost to IBM mobile business, but analysts are skeptical

By , Computerworld |  Mobile & Wireless, BlackBerry, IBM

IBM has shown interest in acquiring the vital enterprise services business of struggling smartphone maker Research in Motion, according to a Bloomberg report on Friday.

The report cites two unnamed sources, including one person who said IBM has informally approached RIM about buying the unit. The unit is valued at at around $2 billion, industry experts say.

Officials from IBM and RIM declined to comment on the report.

However, one person with knowledge of the situation told Computerworld today that the report "not true" and that IBM is interested in buying RIM's crown jewel.

The RIM unit includes BlackBerry Enterprise Server (BES) support and related software functions. The deal could also include RIM's network operations center (NOC).

Thet operation also supports servers used to provide secure Internet connections for millions of RIM users. Many of those users work at large banks and financial services firms that have come to rely on BES for high-level security in email transmissions from and to mobile devices.

RIM says that about 250,000 BES servers, and about 78 million BlackBerry devices, are used at workplaces around the world.

The enterprise services business is widely considered RIM's crown jewel, even as the former smartphone leader has struggled since the introduction of the iPhone five years ago to produce smartphones attractive to consumers.

The unveiling of smartphones running RIM's BlackBerry 10 operating system have been delayed over the past year and are expected to launch early in 2013.

RIM CEO Thorsten Heins has in recent weeks been conducting a strategic review at RIM amid layoffs of about one-third of the company's work force.

Heins has said that RIM may license the BlackBerry OS to third parties, but has not specifically talked of selling off the enterprise business unit or the NOC.

RIM's NOC transmits all BlackBerry data for both enterprises and consumers.

Any deal to buy RIM's enterprises services businesses would have to include an agreement on whether RIM would retain control over part or all of the NOC, including consumer-related traffic, analysts said.

Ken Dulaney, an analyst at Gartner, said an IBM acquisition of RIM's enterprise unit "would make a lot of sense to me. Customers would love knowing that an IBM is behind this."

Still, he said RIM probably wouldn't sell the unit, considering that the company has some $2.2 billion in cash and no debt, and wouldn't want to give up such a vital asset.

Originally published on Computerworld |  Click here to read the original story.
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