Mobile Device Makers Vie to Replace BlackBerry as Enterprise Standard

 
 
By Michelle Maisto  |  Posted 2014-04-13
 
 
 

Mobile Device Makers Vie to Replace BlackBerry as Enterprise Standard


BlackBerry spent much of 2012 and 2013 trying to shake off the image that it was locked in a "death spiral.” It was so succinct a descriptor of the company, in the weeks leading up to the delayed launch of the BlackBerry 10 platform, that after Canadian radio host Matt Galloway used it during an interview with then-BlackBerry CEO Thorsten Heins, the phrase stuck indelibly.

Five years earlier, "enterprise gold standard" was the phrase most often applied to the brand.

In early 2006, half of all smartphones sold were BlackBerry models. By 2009, though, its share of the global smartphone market was down to 20 percent. In 2010 it fell to 16 percent, in 2012 to 5 percent, and in 2013 its share was too low for analysts to delineate on top-five lists.

BlackBerry's fall from the top of the smartphone market was due to the arrival of the Apple iPhone and then Android, coupled with BlackBerry's underestimation of the market impact of consumer smartphone preferences, which ultimately led to the bring-your-own device (BYOD) trend.

In 2014, BlackBerry is a far steadier company, under the sure hand of its new CEO, tech veteran John Chen. Industry insiders expect it to retain a core base of customers within regulated industries and enterprise users who appreciate BlackBerry's security features.

But even if Chen can make BlackBerry profitable again and hold on to its BlackBerry Messenger fan base in emerging markets, the days of BlackBerry being the company in the enterprise space—the standard smartphone for corporate for IT departments—are over.

But this begs the question: Can any single mobile device company replace BlackBerry?

"The answer to the question is that most enterprises are not contemplating a direct replacement," Gartner Vice President and Distinguished Analyst Ken Dulaney, told eWEEK.

"They have now learned that such a decision may be incorrect in a few years as well. So more choice and BYOD programs are the norms."

Based on data from a September Gartner survey, Dulaney added, "Most of the business is going to Apple, but Samsung is expected to get a significant share, too."

Gartner's November report on the survey, which tracks changes in enterprise smartphone preferences, found that, on average, 37 percent of workers in an organization are using iPhones and 26 percent are using BlackBerry smartphones.

Samsung Android devices were said to be used by about 16 percent of enterprise workers, while another 13 percent were said to use other Android smartphones, which puts the Android user base ahead of BlackBerry's.

Furthermore, while 71 percent of the Apple users in Gartner's study said they planned to upgrade to the next version of the mobile OS, only 23 percent of BlackBerry users said the same. By 2016, Gartner expects BlackBerry's user share to shrink by 60 percent.

Good Technology, in its fourth-quarter 2013 Mobility Index Report (an indexing of its customers' activities), reported that iOS activations made up 73 percent of total device activations during the quarter; Android, by contrast, accounted for 26 percent of total device activations, while Windows Phone—holding steady for three consecutive quarters—accounted for 1 percent of activations.

In the enterprise tablet space, Good added, 91 percent of activations were iOS (iPads), compared with 9 percent Android.

Mobile Device Makers Vie to Replace BlackBerry as Enterprise Standard


Gartner's Dulaney and co-author Heather Keltz concluded their report by recommending that businesses "revisit" their relationship with BlackBerry, update their strategy every three months, and further determine the purchasing and support process changes that will need to be made to "accommodate Apple."

Samsung Android devices were suggested as an alternative, and so were "lower-cost Windows Phone devices for enterprise-supplied needs."

BlackBerry still retains its reputation as being the most secure option for use in the enterprise.

"BlackBerry is still the gold standard. We know that to be true—on device encryption, the transfer of data ... it's all there," Kevin Burden, director of Mobility at research firm Strategy Analytics, told eWEEK.

"I remember [BlackBerry founder and former CEO Mike] Lazaridis saying, in a defensive way, that he couldn't understand how customers who were so adamant about security were letting the iPhone in, especially with identity theft running rampant," Burden continued.

"Is good-enough [security] enough? I think it has been for quite some time. I don't think any enterprise will admit it. ... They'll always say that it's an extremely high priority. But the reality is, they're adopting less-secure solutions."

The BYOD trend is partly the cause, but there's also a trend among IT departments, said Burden.

"Why are they adopting a fragmented OS like Android if security is really important? They pay a lot of lip service, but what they really want is a good user experience," he explained. "IT departments want to be seen as progressive … they are starting to be a little more protective of their futures. They don't want to be seen as gatekeepers anymore. They want to give users what they're asking for. So even though Android is something of an insecure platform, they're bringing a lot of Android in."

Jan Dawson, principal analyst and founder of Jackdaw Research, agrees that no one company will replace BlackBerry, and that Apple and Samsung will get the lion's share of BlackBerry's lost business simply because consumers are now doing the buying, not IT, and those two companies rule the consumer space.

"Many companies are in a sort of limbo right now between abandoning the command-and-control model for enterprise mobile devices and figuring out how to manage the new world of BYOD," said Dawson.

While companies are still as conscious as ever about sound security, they're struggling to implement it around a much more diverse fleet of mobile devices, Dawson continued—very nearly repeating verbatim the comments made by Good CEO Christy Wyatt in a Feb. 23 press release announcing Good's purchase of mobile services management company BoxTone.

Together, Wyatt added, the companies will be able to deliver "a high level of security ... and support on par with other mission-critical systems."

BlackBerry CEO Chen, in a Feb. 27 blog post, called Good "not good enough" and challenged it to evolve beyond mobile device management (MDM).

"There are always industries—financial services and certain government departments above all—that are particularly security conscious, and they're going to continue to demand more than just the basic security offered by vendors other than BlackBerry out of the box. There's a huge opportunity here for Good, AirWatch—now VMware—and others to help provide that additional layer of security around Android and iOS devices," said Dawson.

"But for many other companies, the sort of security provided by Apple and Samsung will be sufficient."

Mobile Device Makers Vie to Replace BlackBerry as Enterprise Standard


Dawson called Samsung's Knox security platform "heads and shoulders" above other Android vendors' offerings.

Samsung has certainly seemed to be positioning itself to welcome BlackBerry's defectors. In January 2012, it introduced SAFE (Samsung Approved for the Enterprise), a certification that adds a suite of security features and "enterprise-friendly capabilities" to those included in Android. A year later, Samsung introduced Knox, and a year after that it rolled out Knox 2.0, an improved application container solution for enterprises that adds support for Android policy configurations for third-party containers, such as Good's.

This January, Samsung introduced Samsung Enterprise Services, a portfolio of services to support enterprises through the life of a mobile device deployment. Its newest flagship device, the Galaxy S5, introduced in late February, includes an on-screen fingerprint sensor.

But Samsung isn't yet a BlackBerry shoe-filler.

Strategy Analytics' Burden says that Knox still needs to be paired with an MDM solution, like a Citrix or VMware. ("That's why Samsung is coming out with its own cloud-based MDM.") If an IT department hooks up a Samsung Knox-enabled device to VMware's AirWatch, they pay something in the neighborhood of $3.60 a device for Knox and then another $5 or $6 per license for AirWatch, said Burden.

"If you have BES10, that license is the only license you have to pay."

But like Dawson, Burden expects Apple and Samsung to split and control the majority of enterprise customers.

Gartner's Dulaney also adds Nokia/Microsoft to his list of enterprise players, noting: "They are the choices because they have all implemented high security and have app stores that have been curated. Patches are applied relatively quickly. Expect Lenovo, with its purchase of Motorola, to be a player, and there are niche players such as SilentCircle."

The BYOD Supporters

The popularity of the BYOD trend is part of the reason why BlackBerry will never again be the old BlackBerry—and neither will any other company. Corporate mobile device deployments are now heterogeneous because workers' choices are, too.

Are the software companies offering to add device management capabilities, containerized security, the division of personal and corporate data, and basically all manner of features to supporting BYOD the real beneficiaries of BlackBerry's decline?

"That's why you see the smaller players being gobbled up by the larger players," Burden told eWEEK. "There's a lot of revenue to be made in mobility management." That's why AirWatch and Zenprise became such attractive acquisition targets, he noted. "One by one, we're seeing them gobbled up by the IBMs and Citrixes," Burden said.

Citrix completed its acquisition of Zenprise on Jan. 2, 2013. In a statement, Citrix said, "IT will now have a comprehensive set of tools that make it easy to manage and secure devices, apps and data, while users will now be able to access any app from any device, giving them the freedom to work and play anywhere."

In November 2013, IBM purchased MDM provider Fiberlink for an undisclosed sum, and in January, VMware, wanting a mobility management solution in its portfolio, purchased AirWatch for $1.54 billion.

"Mobility management isn't just phones and tablets; it's going to manage everything," said Burden. "The vendors know that it starts with phones, but it will expand to everything. The BYOD companies are winning. They're worth every penny."

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