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BlackBerry's enterprise aspirations challenged by new offering from Samsung

By: Greg Bonnell, The Canadian Press

Monday, Feb. 25, 2013 at 3:04 PM | Comments: 0

A woman stands behind a Samsung logo at Samsung Electronics Co. showroom inside its headquarters in Seoul, South Korea, Feb. 1, 2013.THE CANADIAN PRESS/AP, Ahn Young-joon

TORONTO - Samsung is making a major move into the corporate smartphone market once dominated by BlackBerry.

The company behind the Galaxy line of smartphones — which along with Apple's iPhone dominates market share — announced the Samsung Knox on Monday.

The "enterprise mobile solution" is aimed at strengthening Samsung's position in the business to business market, which BlackBerry is also targeting with its new line of smartphones.

Enterprise customers who buy devices for many employees at a time helped BlackBerry become a symbol of mobile communications innovation and served as a stabilizing force as consumers turned to rival devices in droves.

Samsung says its Knox allows enterprise customers, who are mainly employees at government, corporate and private businesses, to use one device for both "work and play."

"The Knox solution allows employees to combine business and personal in a single device, without compromising the security that IT departments are looking for," it said in a release.

It's a direct challenge to Waterloo, Ont.,-based BlackBerry (TSX:BB), which is hoping its BlackBerry 10 enterprise service can help restore the troubled company to its former glory.

BlackBerry's new line of phones are also touted as a work-play solution — through its BlackBerry Balance feature — and the company has made other moves recently in an attempt to fend off enterprise market competitors.

"It's not surprising that competitors are scrambling to get into the enterprise," David J. Smith, BlackBerry's executive vice-president of mobile computing, said in an emailed statement.

"Whatever they announce, one thing won't change — the most secure mobile computing solution is a BlackBerry device running on a BlackBerry platform."

The company said more than 3,500 North American enterprises and government agencies are currently evaluating BlackBerry 10, more than double the number from one month ago. Many of those, BlackBerry added, are Fortune 500 companies "particularly excited about BlackBerry Balance."

Last month, BlackBerry opened up its secure enterprise service to other smartphones like the iPhone and Android devices for the first time in its history — recognizing the growing bring-your-own-device to work trend.

Just days before BlackBerry's move, an investment wing of Samsung Group — the leading Android smartphone maker — announced a "strategic investment" in Toronto-based Fixmo Inc., a software maker that specializes in data and device security.

On Monday, Fixmo announced that its "integrity solutions" will be embedded on Samsung devices.

Apple Inc. executives have also made a point of emphasizing the popularity of their iPad tablet with major banks and government agencies. The iPhone has also gained traction in the enterprise market, the executive said on the company's earnings call in January.

BlackBerry's stronghold on the enterprise market once seemed unbreakable, but a dramatic loss in marketshare in recent years and some embarrassing service outages have taken a toll.

The company's latest outage was last September, the same day that Apple's new iPhone launched in stores. The blackout affected users in Europe, the Middle East and Africa for several hours.

In Oct. 2011, another outage lasted several days impacting millions of users globally.

Analysts are split on the future of BlackBerry and its prospects for sales success. Last week, Canaccord Genuity pulled back its expectations for the smartphone maker.

The investment firm said it believes that shipments of the new BlackBerry devices in February will total just 300,000 units, a far cry from its initial estimate of more than 1.75 million.

The Canadian smartphone pioneer revealed its new phones in late January at a splashy New York City event but is making them available in stages.

The U.S. release is expected to be in March, following the February launches of the Z10 touchscreen model in the United Kingdom and Canada.

The BlackBerry Q10, which will have the physical keypad beloved by the so-called CrackBerry crowd, follows in April.

It said Monday that Alicia Keys, the company's brand "ambassador," will kick off her North American tour on March 7 in Seattle, Wash., near the corporate home of Microsoft, followed by dates in Vancouver, Toronto and Montreal.

In her new role, Keys will create music videos with the new BlackBerry phone at each stop on her upcoming tour.

Shares in BlackBerry closed Monday unchanged at $13.48 on the Toronto Stock Exchange.

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