Bob Kimball

Bob Kimball, the new RealNetworks president and interim CEO, delivered a manifesto for the future of the digital media pioneer this afternoon, laying out a plan to exit its content businesses and focus on its core infrastructure for delivering and playing digital media on computers, mobile phones and other devices.

"I have no intention of running the company on a business-as-usual basis," Kimball said, before detailing the strategy for turning around the Seattle-based company. "If we are going to unlock the significant value that has been built at RealNetworks over the past decade, we must do things differently, and we will."

Kimball, previously the company's general counsel, gave praise to Rob Glaser, the company's founder, who stepped down as chief executive last month but remains chairman. At the same time, Kimball made it clear that things will be changing dramatically at the company over the next year as RealNetworks focuses more intently on its RealPlayer software and its infrastructure for delivering ringtones, music, video and other content to wireless carriers.

"RealNetworks' sheer complexity slows us down and makes it more difficult to innovate and focus where it counts most. As you all know, our company is currently organized in four major divisions. Those four businesses, while comprising an incredible set of assets, are also creating a huge amount of complexity -- too much complexity for a company of our size," Kimball said. "We think that's reflected in our enterprise value, which suffers from a conglomerate discount. Too many businesses and the lack of synergies between them has created a bloated organization and diluted management focus. The first big steps to simplify involve separating off our music business and games business, and stopping unprofitable business lines and science projects that are unlikely to reach scale and profitability."

The initial signs of that change were apparently earlier this week, when RealNetworks announced plans to spin off its Rhapsody music joint venture with Viacom's MTV Networks into a separate, Seattle-based company. Kimball told analysts on the conference call that the next step after that will be reviving the long-tabled spinoff of the company's games unit.

At the same time, he acknowledged that it won't happen immediately. His comments followed a difficult fourth-quarter earnings report for the company, in which it posted a $13.3 million loss and projected declining revenue for the current quarter, which ends March 31.

Kimball said the transition will take place over the next year on three fronts -- simplification, restructuring and then a new quest for growth. He cited, as an example of the new focus, a deal that RealNetworks announced today with Sprint, to provide users of its phones with a "unified digital music storefront."

The strategy laid out by Kimball was the result of a strategic review conducted by the company when Glaser was still chief executive. RealNetworks had made clear in recent weeks that it planned to streamline its operations, but the details weren't revealed until today.

At least one analyst today seemed taken aback by the new attitude, in a good way. "Refreshing call," said Andy Hargreaves of Pacific Crest Securities, before asking Kimball a question. "I thought I dialed the wrong number."