A longstanding ally of Research in Motion, the U.S. government has dealt the BlackBerry maker a punishing new defeat in its battle for Beltway belts.
The U.S. Immigration and Customs Enforcement agency (ICE) is terminating its contract with RIM, Reuters reported this week. It “can no longer meet the mobile technology needs of the agency,” according to an ICE statement.
But now ICE plans to spend $2.1 million to outfit its more than 17,600 employees not with BlackBerries but with iPhones.
“The iPhone services will allow these individuals to leverage reliable, mobile technology on a secure and manageable platform in furtherance of the agency’s mission,” ICE explained.
It isn’t the only government agency to break ranks with RIM recently, even as the company plans the release of its new BB10 smartphone in 2013.
Earlier this year, the National Oceanic and Atmospheric Administration announced it would begin buying iPhones for some employees, too, and the National Security Administration released SE Android, its own secure version of the Google operating system.
The BlackBerry has held a grip on business types since it launched in 1999. Wall Street traders were some of the earliest adopters. Banks trusted the handheld email device’s reliability because RIM built its own network of servers to contain and distribute data. And after 9/11, a new market emerged: An influx of homeland-security cash was earmarked to buy equipment for first responders and military officials. As a result, BlackBerrys multiplied on the waistbands of workaholic D.C. types. The brick-like smartphone came to symbolize a civic lack of style.
RIM dug in. It consulted regulators to help shape federal security technology standards, ensuring it always met government needs while creating a largely insurmountable hurdle to incursions from late-arriving but popular competitors. “A decade ago, the BlackBerry was the only mobile tool available to the government when it comes to dealing with crisis management,” explains Scott Totzke, RIM’s senior vice president for BlackBerry security.
The one million public sector workers in North America with BlackBerrys remain the stable part of RIM’s eroding business. A Research in Motion spokesman says the company releases limited data on its customer for confidentiality purposes, but says the Department of Defense is the largest single customer.
As the smartphone wars escalate in D.C., expect to see two inverted strategies go head-to-head: RIM will try to add functionality to a secure system, while Apple and Google retrofit protections to their fun-filled devices. “From a RIM perspective,” says Totzke, “having that built into our infrastructure is much better than trying to bolt it on.”
Observers say it’s possible to envision RIM retrenching to become a company entirely devoted to government service while civilian use becomes an ancillary benefit. “BlackBerry has this incumbent mentality,” says Dan Philpott, a federal cybersecurity consultant in Washington. “They’ve been here, and they’ve been working closely with government agencies.”
If RIM manages to hang on to its important government base, federal workers could, as they’re wont to do, preserve the status quo: Carry an app-filled phone in their pockets for personal use and a securely holstered BlackBerry on their belts for work.
[Image: Flickr user Editor B]