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This post is by Andy Grossman, a SmartBrief contributing editor covering telecommunications and technology.
Shortly before BlackBerry tablet PlayBook launched in April, we defended Research In Motion against naysayers and critics who dismissed the device out of hand, in part because of a lack of native applications such as e-mail and calendars.
It was too early to assess PlayBook’s prospects because the enterprise market for tablets has barely gotten off the dime. Crunch time will come later this year and in early 2012, when the spread of long-term evolution networks dramatically increases the download rate of mobile computers and smartphones.
Our argument in April was that RIM would sell PlayBook largely on the backs of its hard-core loyalty among enterprise users, providing the company time to build native apps needed to lure consumers. And 250,000 PlayBooks later, that proved to be the case, with the tablet outselling the highly touted Motorola Xoom.
So it seems a strange time to bring up RIM’s position in the enterprise e-mail market and the gamble it took under a shared arrangement with Microsoft Exchange.
Much is at stake.
Analysts said Microsoft Exchange Server has been making up ground on RIM’s BlackBerry Enterprise Server in providing a cloud-based e-mail, calendar and contact application that the software giant updated last year as part of Office 365.
With PlayBook still in its infancy, RIM has to persuade developers to write more apps for its ONX platform, a battle the company has been fighting all along against Google and Apple.
The deal? RIM will enable enterprise users to move management of e-mail traffic and other BlackBerry services to cloud-based Exchange Online, which is part of Microsoft Office 365, under a plan to eventually offer BES services in the cloud.
At the time, the deal raised few eyebrows in the media, even though its implications for control of the enterprise market are profound. And without a strong enterprise core, developers are not going to write apps for PlayBook.
“It shows RIM striking off on its own into the cloud and sets the stage for a further showdown between BES and Exchange ActiveSync,” said Matt Cain, lead e-mail analyst for Gartner, referring to the protocol by which Exchange talks to mobile devices.
While Microsoft previously offered ActiveSync and BES services, the company will exclusively provide its ware while RIM does the same for BES, analysts said. That puts Microsoft and RIM head to head because while RIM will provide operational elements of the service to companies for free, it will charge for a license and hardware.
RIM said hooking up with Microsoft will save businesses money, hasten introduction of BlackBerry services and strengthen internal security at a time when information technology executives are concerned about employees’ increasing use of personal wireless devices in the workplace.
But apart from competing with Microsoft, the arrangement carries risk for RIM, partly related to the dual-support strategy.
“They should be able to run a more stable infrastructure, but the problem will be support resolution,” Cain said.
A Gartner report also indicates latency issues that BlackBerry customers suffered when BES and Exchange servers were in separate network domains, although RIM said that problem has been fixed.
And there’s a deeper issue as well. Apple’s iOS devices support ActiveSync, while RIM relies on an access protocol to link with mobile hardware. The risk for RIM is that with employees increasingly bringing their iPhone and iPad to work, corporate IT departments will look more toward Microsoft Exchange instead of BES, even though RIM introduced a service to the market of small and midsize enterprises.