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Research In Motion Ltd (RIM-T) has named a technology marketing veteran to build excitement around the launch of its next-generation BlackBerry 10 smartphones later this year, sending its downtrodden share price higher.
Shares of RIM rose on Tuesday after it said Frank Boulben, who was executive vice president of strategy, marketing and sales for ill-fated telecom startup LightSquared, would assume the role of chief marketing officer. The position had been vacant for a year.
The announcement, part of an overhaul of the company's executive ranks under new CEO Thorsten Heins, sparked a ray of optimism that RIM could succeed in fashioning an effective marketing campaign for the new BlackBerry line.
The devices represent its best hope of reversing deep market-share losses to Apple Inc. and Google Inc.'s Android that have sent its share price about 75 percent lower over the past 12 months.
In a second major appointment on Tuesday, RIM named Kristian Tear, a former executive vice president at Sony Mobile Communications, as chief operating officer. Tear will oversee all operational functions for handhelds and services, including research and development, global sales, manufacturing and supply chain management.
Boulben has taken on the difficult task of reinventing RIM's brand, which built its reputation as a business tool but has since lost ground in the corporate market while failing to catch on among premium smartphone customers in the consumer market.
"Frankly, RIM's marketing and messaging has been a disaster," said Colin Gillis, a technology analyst with BGC Partners in New York. "The company has strengths, but they have not done a good job of bringing those out to the marketplace."
Gillis expects the new marketing chief to create more cohesive identities for the various BlackBerry 10 devices, while also playing up BlackBerry's existing strengths.
That said, he warned a transformation won't happen overnight. "This is a multi-year turnaround effort."
SUPPLY CHAIN ISSUES
Tear, the new operating chief, inherits what RIM critics say are inefficiencies in its supply chain management that thwart timely delivery of finished products, an issue Heins has promised to address.
The company at one point had three chief operating officers -- one of them was Heins until his CEO appointment in late January. Each of them were responsible for a different aspect of the process. Don Morrison retired last year and Jim Rowan stepped down in March.
RIM has been without a marketing chief since March of last year, when Keith Pardy left the company just ahead of the launch of the PlayBook tablet, an iPad competitor that has sold poorly.
Former co-CEO Jim Balsillie had taken on responsibility for marketing before stepping down and leaving the company's board earlier this year.
The Waterloo, Ontario-based company's stock has tumbled about 75 percent over the past 13 months as the PlayBook flopped and smartphones made by Apple Inc. and those powered by Google Inc.'s (GOOG-Q) Android have steadily eaten into the BlackBerry's market share.
RIM's share of the global smartphone market has slipped to 6.7 percent in the first quarter of 2012 from 13.6 percent a year earlier, according to research firm IDC, and it desperately needs a hit with its next-generation BlackBerry 10 devices.
It is crucial for the company to get developers excited about the platform so they will create a wealth of apps to operate on it. A dearth of apps for the legacy BlackBerry is one of the big reasons RIM has suffered huge market-share losses.
"Both hires have significant experience," said Alkesh Shah at Evercore Partners Research in New York, pointing to Boulben's history with networks rather than devices. "If this is a sign that RIM may intend to open its network to other smartphone vendors, it could be a positive."
Balsillie had planned a major strategy shift to open RIM's proprietary network to rivals before he quit.
With the company facing a make-or-break product launch, some questioned the choice of Boulben, who headed strategy at LightSquared, which ran into regulatory hurdles after buying a spectrum it aimed to sell wholesale.
"I don't think Boulben did a great job marketing LightSquared," said Eric Jackson, a fund manager with Ironfire Capital. "They couldn't do better?"
Boulben helped LightSquared forge deals with multiple potential wholesale customers, including a multi-billion dollar deal with Sprint Nextel Corp. (S-N). But Sprint pulled out of the deal after the U.S. telecoms regulator said it in February it wanted to revoke LightSquared's permission to build a network.