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According to the GSM Association, the number of mobile phones being used worldwide reached 2.5bn last month. In that context, a device that is used by just 6.2m people would seem unlikely to make an impression on the industry.

But that is exactly what Canadian company Research in Motion (RIM) has done with its BlackBerry mobile e-mail device. For business users, the small handheld – which resembles an overweight pager – has become almost as iconic as the iPod. But unlike the music player, the BlackBerry does not rely on being street smart: its main users are lawyers, bankers and senior business executives.

The iPod and the BlackBerry are more similar than their appearance and target customers would suggest. Both are examples of how a device can be a success by having one main use, but doing that one task very well. Apple CEO Steve Jobs is reported to have told his designers to make sure an iPod user was never more than three clicks away from a song. The BlackBerry benefits from similar simplicity: turn the wheel on the side of the device, click and you are writing an e-mail.

Having a full, if compact, Qwerty keyboard helps. “Being able to create a lengthy document takes a certain type of engineering, as well as things people don’t pay credit to, such as long battery life,” says Charmaine Eggberry, RIM’s vice president for Emea. “You have to look at how someone uses the device, which is why we have really focussed on that Qwerty keyboard.”

Of course, there is more to the BlackBerry than good battery life and a keyboard. First, enabling mobile e-mail is not exactly rocket science; some handsets, especially in Asia, have had this capability for close to 10 years. But providing secure, business-grade e-mail that can work with company firewalls and meets requirements such as archiving compliance is rather more difficult.

The BlackBerry’s other innovation was to “push” e-mail out to the phone, rather than relying on the subscriber to go into an e-mail program, and download their messages. It might seem a minor difference but to regular BlackBerry users, this is a huge advantage. It is a key contributor to the addictiveness of mobile e-mail, now widely known as the “CrackBerry” effect.

“BlackBerries are now in use in 70,000 companies – so it has become the de facto standard,” says Forrester Research’s Phil Sayer. “Its proprietary ‘push’ protocols to the device from the Blackberry Enterprise Server (BES) are secure, encrypted and efficient. As a complete solution it has been accepted in the finance sector and approved by the UK and US public sectors. It works out of the box.”

It has arguably also made the BlackBerry a niche product. It is not cheap to set up: unless businesses are quite small, they will have to invest in a BlackBerry server to run alongside their existing e-mail systems. They then need to sign up with a mobile operator for an account for each device, and buy the handsets themselves. These remain stubbornly expensive: even the cheapest models cost about £55, or €80, whereas many smart phones are free, at least with a new airtime contract.

What’s more, the conventional BlackBerry is not right for every application. Although RIM has expanded its range of devices to include smartphone-style handsets, users who want features such as a touch screen or advanced multimedia functions may well find they need to look elsewhere.

But the “BlackBerry effect” has been sufficiently strong to prompt two important developments: RIM is licensing its technology to other handset makers; and other vendors have entered the mobile e-mail space.

Key handset makers in the BlackBerry Connect programme, which allows phone manufacturers to ship devices that include BlackBerry e-mail and productivity software, include Sony Ericsson, Nokia, Samsung and HTC, which develops Windows Mobile-based phones for most of the large mobile operators.

“Six out of the seven major handset makers are placing our software on their devices,” says Ms Eggbury. “It gives buyers more choice.” The logistics company TNT, for example, has issued 250 BlackBerry-enabled Nokia 9500 smartphones to its senior management team. The company operates these alongside “classic” BlackBerry devices, from the same server.

The focus of BlackBerry Connect, however, is on enterprise users who have invested in, or are willing to deploy, the BlackBerry server. Although industry analysts estimate that there are about 650m company e-mail accounts worldwide, the potential market is much greater still.

This has prompted companies such as Visto and Seven to take on RIM. Neither company is a household name because they do not market their software directly. Instead, mobile operators sell their services under their own brands. In the UK, for example, Vodafone uses Visto, and Orange uses Seven. This approach allows operators to segment their markets according to the functions users want and, of course, according to price.

In the US, some mobile operators offer e-mail for free, only charging for the data transmitted. Alternatively, an operator could offer a fully-functional e-mail system on a wireless PDA for business users and a simpler, single e-mail account for personal users buying a data-capable feature phone. This, according to Visto co-founder Daniel Mendez, is where the greater opportunity lies.

RIM might have cornered the market among early adopters of mobile e-mail, and made BlackBerry a household name in the process. The real target, however is the billions more mobile phones that do not yet have e-mail at all.

Competition for that prize will be very tough indeed.

Copyright The Financial Times Limited 2017. All rights reserved.
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