Mobile Messaging: Part III - The Mob-E-Mail Battleground

RIM isn’t the only game in town in the fast-growing wireless e-mail market anymore. There are plenty of other device vendors and platform providers ready to give enterprises and individuals a choice.
For all the media attention it gets, especially in the business press, e-mail remains a tiny part of the overall mobile messaging market, especially when compared to SMS. In a survey of consumers conducted by JupiterResearch late last year, only 2 percent said they had mobile e-mail capabilities. But as we'll see in the third in this multi-part series on mobile messaging, e-mail appears ready to take off.

Faster mobile data networks, lower air time rates and more powerful mobile devices with alphanumeric input—including Palm Treos and smartphones based on Windows Mobile 5.0 (the new Motorola Q is the first of these devices)—will help drive the market. There are also indications that demand in the enterprise market is at a tipping point.

More and more companies are interested not just in mobile e-mail, but in using handheld devices for field sales and service automation—dispatch, remote order entry and mobile access to corporate intranets and customer relationship management (CRM) and enterprise resource management (ERP) systems. E-mail has driven adoption of these other applications in the past, but there are signs now that it may as often work the other way around.

"You need secure messaging to be in the game," says Michael Moskowitz, a vice president at Palm Inc. "But the next question is what else can you do?"

IDC is predicting that the worldwide market for mobile middleware—software that enables legacy corporate systems, including e-mail systems, to talk to mobile devices—will climb to $1.4 billion a year by 2009, up from $535.9 million in 2004. That represents annual growth of 21 percent. In a November 2005 report, J.Gold Associates reported that less than 5 percent of enterprise e-mail users in North America have mobile access; so the market has tremendous room for growth.

BlackBerry Under Siege
Research In Motion (RIM) with its BlackBerry handhelds and BlackBerry Enterprise Server (BES) platform for integrating mobile e-mail with existing Microsoft Exchange and IBM Lotus Domino-based mail systems, virtually invented the mobile e-mail category and has dominated it. According to the J.Gold report, 70 percent of the estimated five million enterprise mobile e-mail users in North America use BlackBerry. The nearest competitor, Intellisync Corp., had 10 perecent of the market. RIM has also had a commanding lead in the mobile middleware market—about 20 percent in 2004, the last year for which figures are available from IDC.

But RIM today is under siege. Having settled one highly publicized law suit for patent infringement with NTP for $612.5 million, the company now faces another from Visto Corp. And perhaps more alarming for RIM, the market is starting to catch up. Competitors such as Intellisync (which was recently acquired by Nokia), Good Technology Inc., Visto and, most importantly, Microsoft are giving RIM a run for its money.

RIM's key differentiator was always its push e-mail technology. With push, subscribers don't have to remember to retrieve e-mail: Messages are relayed to their mobile devices automatically as they're received either at a corporate e-mail server or POP e-mail account. Enterprise customers install a BES, attached to their Exchange or Domino server. The BES sends messages over a secure connection to a BlackBerry network operations center (NOC), which sends them over the air to the mobile device.

The Good and Visto solutions work much the same way, offering users of other devices - Palm, Symbian and Windows Mobile-based smartphones - the same kind of push e-mail experience as BlackBerry users enjoy. Good and Visto have also made inroads on RIM's exclusivity with mobile carriers. Over 130 operators worldwide resell BlackBerry products and bill for BlackBerry service. But now Good and Visto have similar deals with North American carriers who are looking to avoid having all their mobile e-mail eggs in one basket.

Microsoft, with the introduction late last year of its Exchange Server 2003 Service Pack 2 release and the appearance of the first Windows Mobile 5.0 devices looks to become a major player. Companies already using Exchange Server 2003 who upgrade with Service Pack 2 can deploy a push e-mail solution that requires no additional mobile e-mail server - a significant savings, the company argues - and no routing of messages through a third-party NOC.

"From a security perspective, a lot of customers like the idea of their sensitive corporate information being pushed directly out to devices and not going through third-party infrastructure," says Sean Seaton, director of the Windows Mobile and embedded devices group at Microsoft Canada.

Implementing the Microsoft Mobile Messaging solution is very simple for customers with Exchange 2003 and WinMob 5.0 devices, with no incremental costs or maintenance and only minor configuration changes required. Microsoft also argues that it will be able to offer much greater device selection when the flow of new Windows Mobile smartphones from vendors kicks in this year. And enterprise customers will be able to develop applications for the desktop and then port them to the devices.

Other vendors argue desperately that they too have critical advantages over RIM. Palm offers breadth of choice on the hardware side. Its Windows Mobile 2005-based Treo 700w smartphone will work in Microsoft Mobile Messaging deployments. Palm also partners with Good and Visto which support its Palm OS devices. Some Palm devices in some countries (coming to the U.S. in July) can even run the BlackBerry Connect client software which allows them to receive e-mail from a BES.

"Having just one device [type to offer] doesn't work in the longer term from the strategic perspective," Moskowitz says.

Dan Rudolph, director of product marketing at Good Technology, notes that RIM is primarily a hardware company. About 70 perecent of its revenues come from hardware sales, he points out. Good on the other hand is "solely focused on the software and service side."

The Good network architecture also offers a key advantage over BlackBerry: customers can push software upgrades to mobile devices without touching them, which saves software maintenance costs. "That's important, especially if you have 1,000 devices," Rudolph says.

Despite its apparently eroded position, RIM is conceding nothing. "The legal challenges and the new competitors, they're just distractions," says Alan Panezic, director of the BlackBerry solutions group. "Our customers are telling us that nothing else out there works like BlackBerry. They're saying it's easy to deploy and control and manage, and easy to extend to do all kinds of different things such as sales force automation, that it's a complete platform."

Microsoft, he argues, doesn't even offer a true push service. "It's more poke and pull." Panezic is referring to the fact that in the Microsoft mobile messaging architecture, devices initiate the connection with the server.

Since the server is sitting behind a firewall, this poses a security risk - hackers could try to break in. It's a risk BlackBerry users don't face because the BES always initiates the connection and establishes a secure tunnel to the device. If Exchange Server 2003 customers use VPN (virtual private network) technology to beef up security, RIM argues, it seriously degrades device battery life.

Microsoft argues that a VPN isn't necessary. Mobile connections are protected by SSL (Secure Socket Layer), which can be implemented with triple DES encryption. SSL is used in secure Web connections between banks and customers. The Microsoft Mobile Messaging solution is also certified for compliance with FIPS 140-2, a stringent government encryption standard.

Beyond E-Mail
The real battleground in the looming war for the corporate palmtop likely won't be e-mail at all. It will be convincing corporate customers which is the best platform for developing mobile data applications that go beyond messaging.

RIM may be at a disadvantage there, even though it has been investing heavily in making BlackBerry a more versatile platform and can point to successful customer implementations of field sales and service applications as proof that it's succeeding.

But as Microsoft's Seaton points out, there is a trend among big corporations towards "consolidated procurement" - centrally managed and standardized purchasing in which companies may be more likely to choose Microsoft solution's because it allows them to leverage investments in Exchange. Not that it's a slam dunk for Microsoft either. As RIM's Panezic says, the BlackBerry is enormously popular with end users, and that will count for something.

Two things are certain: the mobile e-mail market will get bigger, probably quite quickly, and RIM, while it will survive and may even thrive, won't be the only game in town anymore.

This article was first published on PDAStreet.com.






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