A Darker Story

By Clint Boulton  |  Posted 2011-08-14 Print this article Print

The numbers don't lie, but a darker story may be emerging in RIM's enterprise business as companies are dumping BlackBerry handsets for, or complementing them with, iPhones and Android phones. That's bad for both RIM's BlackBerry sales and for sales of its BlackBerry Enterprise Server (BES) software, which helps protect and manage the corporate BlackBerry devices.

Enter Fender Musical Instruments, which this month is offering a program to let 300 of its Blackberry-using employees dump their company-issued devices to use their own iPhones or Android phones. 

Fender pays 100 percent of the costs of its employees' BlackBerry devices. However, it will pay workers who use their personal iPhone or Android handset a stipend equal to the data costs incurred by its corporate BlackBerrys.

The program, which will be optional, has been piloted by 40 Fender information workers, with roughly 27 ditching their Fender-fronted BlackBerry smartphones for their own iPhones and 13 doing so for their own Android phones. The personal devices run the gamut from iPhone 3G, iPhone 3Gs iPhone 4 devices to Motorola Droids, HTC Evo 4Gs and other Droid choices.

Jason Bredimus, vice president of global infrastructure for Fender, said this program was conceived after CEO Larry Thomas joined the company and wanted to use his iPhone for professional communications. Fender, which Bredimus said fancies itself as hip and not some "staid corporate company," wanted to be flexible and extend the choice to its knowledge workers.

While Fender is still primarily a BlackBerry shop, Bredimus said he has seen a positive response and uptake of employees eschewing BlackBerry smartphones for their iPhones or Android devices.

"We expect this change to accelerate the conversion to even more iPhones and Androids," Bredimus said. "Our philosophy in IT is that we don't want to be the party of no. We want to say yes to users but do so in a way that is responsible and protects Fender's assets."

To that end, Fender still uses BlackBerry Enterprise Server to manage Fender-issued BlackBerry devices. Good Technology is providing remote wipe and other enterprise management capabilities for the iPhone and Android gadgets.

This is where RIM takes another hit from its corporate clients. Not only are iPhones and Androids chomping BlackBerry's share, but Good and others are filling out a new ecosystem of device management to support these newer platforms.

Forrester Research analyst Michele Pelino agreed that RIM's BlackBerry handset share is threatened by companies that are moving to a hybridized model of letting consumers bring their own devices to work. RIM is "entrenched in that enterprise environment, and now that enterprise environment is going much more hybrid, with larger firms opening doors to other OS' and devices," she said.

Jack Gold, founding analyst for Jack Gold Associates, explained RIM's problems in a nutshell: "The problem for RIM long term is this: If users get to pick their own devices, what will make them pick a BB? That is the fundamental issue. So RIM needs to do something that will excite end users and get them to want a BB."

Fortunately for RIM, the smartphone market has proven nothing if not diverse. Android just captured the U.S. lead from RIM a year ago, but RIM could regain some lost share if it brings its so-called "superphones" to market.

These devices will eschew the classic BlackBerry OS for RIM's QNX operating system, which currently powers the BlackBerry PlayBook tablet. RIM is calling the platform OS Next. 

Unfortunately for RIM, those superphones aren't coming until 2012. Gold expects that while RIM may continue to lose market share in the enterprise until those next-generation phones appear, the newer handsets will staunch some of the bleeding.

"I don't think RIM will lose the enterprise as quickly or completely as some believe," said Gold. "I do think they have the time to recover, but if the OS Next devices are not a solid hit, there will be a continued slide in market share. The next six to 12 months are critical for RIM."


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