Pending BlackBerry Bans Hurting Sales

 

While us back in the States might not really care if India, the United Arab Emirates, Saudi Arabia or others ban Research In Motion’s (RIM) BlackBerry smartphone, the looming prospects of BlackBerry bans are crippling sales of the units in those countries. That certainly is not good news for RIM, which is currently struggling to keep its number two spot globally. In fact, some BlackBerry dealers in India are requiring deposits before they order any units and some have stopped ordering anymore at all.

The Times of India is reporting that for those dealers who are still selling BlackBerrys, their sales have dramatically dropped off. Think by a factor of 2-6x. Surprisingly, Nokia is seeing the biggest boost from the growing fear of purchasing a BlackBerry but having it banned shortly.

Hopefully, India does not decide to ban the BlackBerry but the fear of such a ban has simply made people reluctant to risk it. Presumably, the same thing is happening in other countries considering bans. Before this is all over, RIM might just end up suffering some long-term harm.

As RIM moves into more and more markets globally, we an expect similar threats to ban its BlackBerry due to its encryption features that seemingly have most government’s intelligence agencies stumped. Is one of the BlackBerry’s strongest features going to come back to bite it? I certainly hope not.

Of course, there are other encryption services and smartphones available with considerably stronger security, but they cost quite a bit. Think over $3,000 for a smartphone that the NSA approves of. Corporate clients love the BlackBerry because of its encryption at a reasonable price, its ease to manage from an IT perspective and business oriented features. If RIM is forced to take the bite out of its encryption in many countries, how is it going to fare when the iPhone and Android start to step up their corporate game?

Think this might be the end of the BlackBerry’s legacy as the most secure smartphone platform widely available? Wonder how RIM hopes to compete if its smartphones lose some of their security? Let me know.

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