Wednesday, August 4, 2010

Blackberry may not be banned in UAE

This is what we all would like to hear, don’t we? To put things in perspective, UAE and Saudi Arabia are not banning the BlackBerry device produced by Research in Motion Limited (RIM). But instead it is the BlackBerry mobile services like e-mail and text messaging by October 11, 2010.

The reason for this ban is a dispute between the UAE and RIM concerning RIM's encrypted data system. The system makes government monitoring of data more difficult. The problem for RIM is that the other GCC countries may follow suit, which will have a major business impact for the company. India has also been negotiating with RIM to access the encrypted information being exchanged on Blackberry devices.

Many countries including India claim that such moves are driven by national security. Many will suggest that this is simply an excuse to block data, but others suggest that this is a viable excuse to limit data. There can be a business reason to block the service, citing the possibility that service providers in UAE may come out with a similar service for the subscribers.

UAE's Telecommunications Regulatory Authority noted that "certain BlackBerry services allow users to act without any legal accountability, causing judicial, social and national security concerns for the U.A.E." Countries like Qatar have come forward and have announced that the service providers will not block the Blackberry service. Don't know if they also feel the security threat or not?

RIM will have to rethink its position on not sharing the data information, as potential business may be lost. UAE and Saudi Arabia has around 500,000 and 400,000 blackberry users respectively. Assuming the remaining GCC countries may comprise of another million users; RIM can’t afford to lose so many users while they are expected to unveil the new BlackBerry 9800 at a press event on 03 Aug 2010. U.S.-listed shares of Research in Motion (RIMM.O) fell 1.6 percent in early trading on Monday as the ban news spread across the world.

When discussing UAE’s adamancy with RIM to provide access to the data, it’s worth highlighting the fact that it had unsuccessfully attempted to install a application, rumored to be a spyware, on the devices of Etisalat users in 2009, informing the user’s that the patch would enhance the performance. The region has always attempted to block websites, which pose threat to the existing regimes.

Could this ban impact RIM’s business? The rumors are that RIM is already in talks with the Middle East governments to have a work around. There are more than a million Blackberry users in GCC and if even half of them change mobile devices, there could be major loss for RIM.


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