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Good Wins on RIM Turf

Bearding the mobile messaging lion in its den, Good Technology Inc. said this morning it has signed a reseller agreement with Bell Mobility Inc. , based in Canada, the home of BlackBerry provider BlackBerry . Good also said it has signed a similar deal with Australian mobile operator Telstra Corp. Ltd. (ASX: TLS; NZK: TLS)

Normally, when mobile email providers announce carrier agreements it's hardly big news; for the carrier, there's little downside to supporting multiple platforms beyond minimal operations management costs. Because Bell is a Canadian operator, however, the Good contract represents a milestone in the evolution of the mobile messaging market, beyond a BlackBerry-centric universe.

"It's our opinion that having a reseller in Canada right next to RIM means something beyond just being neat," says Good vice president of marketing and product management Rick Osterloh. "It shows that a carrier extremely familiar and intimate with RIM is acknowledging the need for another player in the enterprise-focused space. The carriers are realizing that other solutions aren't really making it for these enterprise-grade platforms coming out."

The release in recent months of an array of new smartphones that run Windows Mobile 5.0 or other non-RIM-focused operating systems, including the Treo 700p and 700w from Palm Inc. , the Motorola Inc. (NYSE: MOT) Q, and Nokia Corp. (NYSE: NOK)'s E-series, means that mobile workers have more choices than ever in selecting a device, and a platform, for their mobile messaging needs. (See New Q Review.)

"All the carriers worldwide are seeing the trend in smartphone choices picking up, with the Treo and other Windows Mobile 5.0 devices, plus new Symbian Ltd. handhelds including the Nokia E series," Osterloh explains, "and we're being offered side-by-side in these carriers' portfolios as a premier offering, next to BlackBerry. They're choosing us for our support of these new smartphone devices."

"The carriers need to hedge their bets because there continues to be a diversity of devices that are RIM [-centered]," says Ellen Daley, vice president and research director at Forrester Research Inc. "I suspect we’ll continue to see more of this type of solution."

The notion of a RIM vs. Good struggle is not entirely accurate, however. While Good is a provider of software platforms, including Good Mobile Messaging and its security application, Good Mobile Defense, RIM continues to make some 70 percent of its revenue, and an even higher fraction of its profits, on hardware.

"It's the other devices (Nokia E series, Treo, Windows Mobile devices without Exchange) that are competing head-to-head with RIM," Daley points out.

Nor has the rise of competing solutions hurt RIM's results, so far: RIM shares went up by almost 6 percent last week as its quarterly sales rose 35 percent.

To competitor Osterloh, RIM's destiny resembles that of another maker of high-end software and hardware that became a boutique provider: Apple Inc. (Nasdaq: AAPL). "They'll keep chugging along, with very good results, but they won't experience the same kind of growth curve as the smartphone market in general," he predicts. "Most analysts predict growth of 100 percent year-on-year in this market, and BlackBerry just isn't growing like that anymore. We're more directly correlated with the growth of the broader smartphone market."

— Richard Martin, Senior Editor, Unstrung

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