Microsoft, Research in Motion sign licensing deal
By Hayley Tsukayama,
Microsoft and Research in Motion announced Tuesday that they have signed a licensing deal for Microsoft technology that allows users to more easily move media and data between desktop PCs and other devices.
The deal, according to David Kaefer, Microsoft’s general manager of intellectual property licensing, will allow RIM to meet the demand for mobile devices to “display richer images and data than traditional cellular phones.” The deal is part of Microsoft’s IP licensing program, according to a news release.
Shares of Research in Motion spiked on the news, sending the stock up 2.5 percent to $7.44 following the announcement at noon before settling to around $7.40 in mid-afternoon trading. Microsoft shares were mostly unaffected, trading down slightly to $31.19 a share.
The agreement deals with Microsoft’s exFAT (Extended File Allocation Table) technology, which is a file system the company developed particularly for flash drives. Microsoft also licenses the technology to companies such as Sharp and Sony.
Having use of the technology could help RIM add more multimedia capability to its phones, which consumers will welcome. Whether it would help RIM do anything more than keep up with the competition in the smartphone space remains to be seen.
The deal gave RIM a boost in the market, even though it may not be the kind of licensing deal that its investors were hoping for. The company has been looking for ways to get its BlackBerry 10 system onto other smartphones and has reportedly been shopping the software around to smartphone manufacturers.
There has also been speculation that Microsoft and Nokia would buy up the struggling Canadian firm, as the Wall Street Journal reported late last year, but those talks aren’t believed to have gone anywhere.
Research in Motion stock has dropped more than 30 percent in the past three months as the company has announced delays and layoffs. The company reshuffled its executive bench in January, dropping co-CEOs Jim Balsillie and Mike Lazaridis in favor of Thornsten Heins, formerly the company’s chief operating officer.