Tuesday, April 11, 2006

RIM - It's the RedBerry in China

Nothing seems to be easy for RIM these days, and no doubt their space is going to get more crowded, not less crowded.

Very interesting piece in today's Globe & Mail about China's homegrown version of BlackBerry - the RedBerry. Aside from the story itself, I thought it was interesting that this ran in the front section of the paper, and not the business section - where you usually see stories about RIM. However, this is really a bigger story - touching on the realities of global competition, how technology is transforming our lives, and privacy.

On a business level, the story is not good news for RIM. J-u-s-t as they are about to launch in China, China Unicom (China's #2 mobile carrier)comes to market with their own RedBerry. Asia is notorious for knock-offs of all shapes and sizes, and this one is right up there. In Hong Kong, RIM has been getting $64/month for their service. RedBerry is under $1, "plus a few cents for each email sent". How can they possibly compete with that???

What's really interesting is why RIM's China launch has taken so long. As the article explains, one reason for the delay was "China's concern that the high-level encryption technology...could make it difficult for China's security authorities to gain access to email messages". Wow. So, RIM is up against the same issues plaguing the likes of Yahoo and Google in their efforts to bring IM to China. We take privacy for granted, and it's that very concern that's led to RIM's network being so good and so secure. To enter China, it sounds like it has to be not-so-good and not-so-secure, as "Chinese security agents routinely monitor email".

So, clearly, what makes RIM so successful in North America could become their Achilles Heel in China. Maybe that's why China Unicom can afford to offer the service at under a buck a month. Sounds like if RIM is going to compete they need a really dumbed-down version that costs very little to develop and support. Of course, RedBerry is going after the consumer mass - literally mass with 400 million wireless subscribers - market, while RIM is trying to crack the far more demanding enterprise market. Still, if the government requires access to monitor business emails, RIM will not have an easy go of it.

That said, one could also wear the cynic's hat and say Chinese "security authorities" have been deliberating with RIM as a stall tactic to give China Unicom more time to get their RedBerry ready in advance of RIM's big launch. This tactic certainly wouldn't be out of place in a James Bond movie!

You also have to wonder with the world coming to Beijing for the 2008 Olympics, how long they can realistically maintain this Big Brother mentality in the Internet age. Just a thought, but it's a real issue in my mind.

While RIM has been successful on many levels defending its brand and technology, they probably won't get very far going after the RedBerry name in their home market. Global competition sure is a tough game, and politeness - one of Canada's virtues - won't likely get you very far in a market like this.

So, to my good friend, Howard Thaw, a friendly word of caution - don't flaunt your RedBerry too much around these parts - but I suspect you'll be very popular in Beijing...


1 comment:

ipcom said...

Posted by: Jim Courtney

But, according to your post of Jan. 30, Howard has a Cranberry! http://www.ipcom-insights.com/blog/jon/archives/2006/04/rim_its_the_red.html