Research In Motion Ltd., the maker of the BlackBerry smartphones, said it will terminate 2,000 jobs, or almost 11% of its workforce, amid losing market share to Apple Inc.'s iPhone and smartphones running on Google's Android operating system.

"As part of this broad effort, RIM is reducing its global workforce across all functions by approximately 2,000 employees. RIM intends to notify impacted employees in North America and certain other countries this week. The remainder of the global workforce reductions will occur at a later date subject to local laws and regulations. All impacted employees will receive severance packages and outplacement support," RIM said in a press release.

A decade ago, RIM revolutionized the smartphone market with a mobile device that could send e-mail and text messages. Its devices with the QWERTY keyboard continued to sell with the popularity of Twitter. However, in the past two years, the BlackBerry has had difficulty finding its relevance in the market place.

It's not that people are no longer buying smartphones. Research firm IDC in fact in June said it forecasts the smartphone market to grow 55% (to 472 million smartphone units) year over year in 2011. That figure will nearly double to 982 million by the end of 2015, the IDC said. Quick-messaging devices (phones with a QWERTY keyboard), once a bright spot within the feature phone market, appear to be losing steam as smartphones gain popularity, IDC said in April.

Apple has reported record sales with its iPhone line and is expected to further improve sales with the release of the iPhone 5 later this year. Samsung and phone makers using the Android platform have also gained ground in the market, pushing the Android to become the top platform for smartphones.

Apple's phones are bolstered by thousands of software or apps available at Apple's App Store and Android devices also have apps for downloading at Android Marketplace. Apple's iPhones and other smartphones have removed the physical keyboard, putting screens as large as the smartphone by using a virtual keyboard.

As rivals are busy with more innovative product offerings, BlackBerry has not deployed a major new BlackBerry model since August last year. BlackBerry in May cut its earnings outlook and said it would reducing its headcount, after losing ground in the smartphone market to rivals.

RIM though expects to have an aggressive second half of the year. It told shareholders early this month that it plans to release seven new smartphones running on next-generation operating system in the coming months.

The Canada-based company has already scheduled a "late August" release of the new touch BlackBerry Bold 9900/9930. The new Bold looks a lot like the previous version, but boasts of a 2.8" touch screen and claims to be the thinnest Blackberry phone yet. The Bold phone has the physical keyboard that is a trademark for BlackBerry phones and the touch screen that makes the iPhone popular. It has a 1.25 GHz processor, 786 MB of RAM, 8 GB of onboard memory with an option to expand (using up to a 32 GB media) card, and dual-camera, including a 5-megapixel back-facing camera for 720p HD video recording.

The BlackBerry Bold 9900/9930 will run on BlackBerry 7, the latest version of RIM's operating system, and will support BlackBerry App World for purchasing and downloading apps. The BlackBerry 7 browser includes a new JIT (just in time) JavaScript compiler to improve the load time speed of web pages. The new browser also includes support for additional HTML5 elements, such as HTML5 Video.
Mike Lazaridis, co-CEO with Balsillie, attributed the delays in the new OS on the company's efforts to launch smartphones that meet market expectations. "It may have delayed us, but we are going to come out ahead," Lazaridis said.

With the job cuts, the job cuts are part of wider cost-cutting effort as executives promised to navigate the Canadian company through a "transition" towards more competitive products.

The Wall Street Journal, however, notes that RIM's latest job cuts were deeper than expected. It pointed out that Nokia Corp., also suffering erosion of market share amidst a transition into producing Windows-based smartphones, cut or transferred about 7,000 staff in April, which represented just 5% of its global work force.

In recent years, RIM, The WSJ points out, has added thousands of workers to keep up with demand for its BlackBerry phone. The job cuts follows a period of rapid growth within the company whereby the workforce had nearly quadrupled in the last five years alone.
Following the completion of the workforce reduction, RIM will have 17,000 people remaining to create smartphones that would bring back consumers.

The BlackBerry is not expected to go in to extinction together with some talk and text only devices. IDC expects that the BlackBerry OS, which is solely used for BlackBerry phones, will maintain its position as a Top 4 smartphone operating system until 2015. The research firm expects that Android (which is being used by Samsung, HTC, LG and other phone makers) will continue to be the top platform for smartphones. The iOS, which is used for Apple's phones, will maintain its third spot. Windows OS, which will be used for Nokia phones, will be the second most popular.

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