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News Analysis: Berry In A Fix
With the pact between Airtel and Microsoft, RIM is in a dilemma over the distribution of Blackberry to other service providers
Sudesh Prasad
Wednesday, October 04, 2006
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The mobility market is bustling with activity. The e-mail market, particularly, appears to be heating up with Airtel announcing tie-up with Microsoft to offer Windows Mobile 5.0 to its corporate customers. While Airtel has broadened its portfolio of offerings for mobile mail users, RIM, the maker of Blackberry, surprisingly, continues to remain reluctant to expand its offerings through other mobile service providers in India. Users of Hutch or other operators cannot go for Blackberry, as there is no number portability in India. The corporate users also feel that going for another device, just for e-mail makes little sense.

RIM's Contention
Globally, Blackberry is increasingly becoming popular instead of mobile e-mail. But instead of capitalizing on this advantage, RIM has taken an exclusive route to expand in India. When VOICE&DATA asked about RIM's reluctance to go to other service providers like Hutch, even in the wake of Airtel's newly announced relationship with Microsoft, the vice-president, Asia Pacific, RIM, Norm W K Lo said, “We are happy with the relationship with Airtel, as it is adding a great value to Blackberry users. We will continue to maintain its exclusive tie-up with Airtel.” He refused to comment on whether RIM was in talks with other service providers.

Global Situation
Incidentally, RIM has partnered with multiple operators in countries like the US, Hong Kong and Singapore. Interestingly, Microsoft has not gone for an exclusive arrangement with Airtel. For example, in the US, Microsoft boasts of clients like Verizon, T-Mobile, Sprint and Cingular.

RIM's global competition includes Palm, Hewlett-Packard, Nokia, and Motorola, as far as the device is concerned. On the software side, its rivals include Good Technologies and Microsoft. However, Blackberry's edge over Windows Mobile 5.0 lies in its capability to provide end-to-end solution unlike Microsoft. It provides all the software components of push e-mail solution, but not the device itself and has tied up with HP and i-mate for device support. 

Global: There are 5.5 mn Blackberry devices among 2.5 bn mobile phones in use

India: There are around 25,000* Blackberry users among 116 mn mobile users

*V&D estimates

Bharti Airtel's Competitive Edge
The tie-up with Microsoft was Bharti Airtel's masterstroke to further consolidate its position of being a mobile e-mail provider with wide range of devices and options. It has got a definite lead over its competitors like Hutch, Idea, and others. The incumbents-BSNL and MTNL-also have not really been able to focus on the high-end segment.

According to official response of Bharti Airtel, “With the Windows Mobile 5.0, Airtel has expanded its business solutions portfolio.  Windows Mobile 5.0 complements Blackberry. Depending upon the usage patterns, requirement and suitability, customers can choose what they want.  We now offer them a choice with the latest in the field of on-the-go access to business information.”

Blackberry Vs Rest*

Handset

Hutch

Airtel

Idea  (Mail v1 - Push Based and Idea Mail v2-Pull based)

Handset Requirement

Only Windows devices

Only Blackberry device. Offers Blackberry Connect services for other handsets

Symbian and Windows devices

Handset Examples

Nokia S60 series phones, Nokia Communicator, Sony Ericsson: P800, P900, P910i, Imate, O2, HP ipaq, Krome

Blackberry, Nokia 9500 Communicator, Nokia 9300, smartphone and Sony Ericsson P910

O2, ipaq, SP 230, Nokia, Sony Ericsson, Motorola

Handset Cost

Rs 10,000 to 30,000

Rs 15,000 to 25,000

Rs 10,000 to 30,000

Security

AES 128-bit encryption

End to End AES or Tripple DES encryption-FIPS 140-2 validated encryption

128 bit AES encryption end-to-end

Attachment

View Attachments

View Attachments

View, Edit, Save and Re-send Attachments

Mail Platforms

Microsoft Exchange and Lotus Domino

Microsoft Exchange, Lotus, POP 3 and IMAP 4 supported mail

Microsoft Exchange, Lotus

Recurring Cost (Monthly Subscription Fee, downloads)

Rs 199 (pay for usage*)Rs 499 (500 MB free, thereafter pay for usage*)Rs 699 (1 GB free, thereafter pay for usage*) Rs 899 (Unlimited Access)

Entry price of Rs 499. Airtel charges 50 paisa per kilobyte

Rs 500 with zero usage charges

*The list is only indicative

Way Forward
Blackberry's strategy of continuing its exclusive relationship with Airtel is a big limitation. It has become a real hurdle in the growth of Blackberry devices in India. According to an estimate, out of a total mobile population of 106 mn, there are around 25,000 Blackberry phones in India (there is a non-disclosure arrangement between Airtel and Blackberry to not reveal the total number of such devices in the country). While it is a win-win situation for Airtel in the light of its recent Windows Mobile 5.0 tie-up, RIM appears to be in a spot.

Consider the offerings of other mobile service providers. There is a strong feeling among other service providers like Idea Cellular that they have been deprived of the privilege to offer Blackberry devices to its corporate customers. The company organized a vociferous media campaign sometime back to prove that other devices offered by the companies (Ericsson, Nokia and others) were superior to Blackberry. Even Hutch Mail claims to offer almost same level of services as Blackberry.  However, a random check made by VOICE&DATA reveals that some CEOs using Blackberry have a high level of satisfaction.

Only time will tell whether RIM extends its multi-operator strategy for India while considering the increase in numbers of high-end users, who depend on mobile e-mail. The company has just come out of a long-standing patent dispute with NTP after paying $612.5 mn. With Motorola and Nokia planning to introduce more e-mail devices to counter Blackberry, RIM's task is well cut out.

Sudesh Prasad
sudeshp@cybermedia.co.in

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