RIM – Soon The Database On Your Hip?

Canadian pager pusher Research In Motion Limited has had a rough time of it recently, what with having to cut its sales and earnings outlook for the coming quarters while industry watchers question its ability to prosper against competitors hungry to horn in on its niche in the wireless email market. However, recent announcements have done much to bring RIM’s strategy for moving forward in a much competitive market into focus.

On the enterprise side, RIM has this week announced plans to enable all types of corporate data -- not just email -- to be served up to its devices via its BlackBerry server. Meanwhile the company has told analysts that it expects to have signed distribution agreements with 30 carriers in 15 countries by the end of 2002. The BlackBerry is certainly not the North America-only phenomenon it was just two years ago.

Financial analysts that track the company are confident, even bullish, about its long-term prospects. To paraphrase, they feel that the company is in a strong position against its many competitors because no other firm can offer exactly the mix of hardware, software and wireless service that RIM can.

The software that will enable companies to pass more corporate data to the BlackBerry devices is called Mobile Data Service (MDS). This will be available in the BlackBerry Enterprise Edition Server 3.5, which is due to hit in two to three months time, according to a report by BMO Nesbitt Burns Research.

This software should allow companies that use the BlackBerry system to get pre-selected information from corporate databases and applications right on their device. Ray Sharma, wireless technology analyst for BMO Nesbitt Burns, says that by the end of the year RIM should also have version of its enterprise server that links directly into a company PBX (private branch exchange), so that voicemail from a user’s wireline phone can be routed to a compatible RIM device, as well as wireless data.

RIM has been building up to the MDS announcement for a while. The company has already worked on similar one-off projects with partners like SAP AG, Siebel Systems Inc. and Computer Associates Inc. linking their applications to the RIM server.

The other key part of the company’s enterprise play is mobile Java (J2ME). The company has had Java-enabled devices on the market for a while now. But Java compatibility will become crucial as third-party devices using its technology arrive on the market (see RIM Looks to BlackBerry Spread.) “On the device side, RIM eventually has to compete for sales with other devices but all those devices could be running BlackBerry software,” says U.S. Bancorp Piper Jaffray analyst William Crawford.

RIM will need all its technological know-how to keep of rivals with deep pockets like Microsoft Corp. and smart start-ups, such as Seven. However, BMO Nesbitt Burns’s Sharma reckons that no other company can offer the array of devices, tailored enterprise and links to carrier and data networks through a network operations center (NOC) that RIM can.

Indeed, Piper Jaffray’s Crawford says that competing against Microsoft may make RIM more attractive as partner to powerful companies that like to keep off path that Redmond is on, such as IBM Corp., Sun Microsystems Inc, Oracle Corp and Nokia Corp.. “The carriers are also very wary of Microsoft,” he notes.

And RIM will be increasingly dependant on carriers for its livelihood, as they will be the ones that sell its hardware and software to customers. Crawford wonders about this. “Can their new carrier partners sell into the enterprise?,” he asks. “It’s too soon to say.” However, Sharma is more bullish, noting that VoiceStream Communications recently sent 60 employees up to RIM’s headquarters in Waterloo, Ontario for BlackBerry certification and may send 80 more up that way soon.

— Dan Jones, Senior Editor, Unstrung
http://www.unstrung.com