BlackBerry Maker Faces Possible Ban in India

Research in Motion, which averted a ban in Saudi Arabia, is facing troubles in India, where its BlackBerry service may be shut down if it doesn’t address the country’s security concerns.

The Indian government, which meets with regional telecom providers on Thursday, plans to discuss matters relating to national security requirements. It is not clear whether RIM would take part in the talks.

“There definitely could be talk of some deadline and a proposal to take strong action on BlackBerry services during the meeting,” said an anonymous government official familiar with the matter. The wireless companies may also be asked to temporarily shut down BlackBerry’s email and messaging services if RIM doesn’t agree to offer access to its encrypted data.

The disagreement with the Indian government is the latest snag in RIM’s expansion into emerging markets. The Waterloo, Ontario-based company’s system of centralized servers, unique among handset makers, protects data passed over its devices with strong encryption. This level of protection has made BlackBerry handsets of choice for many businesspeople and government officials, including U.S. President Barack Obama.

However, a growing list of countries, including the United Arab Emirates, Saudi Arabia and Lebanon, want to monitor these communications, citing national security concerns like terrorism. RIM, meanwhile, has been in various stages of negotiations with these countries to negotiate a balance between the company’s commitment to data protection and the governments’ desire to monitor BlackBerry communications.

Talks on the issue have often been contentious, with RIM co-CEO Michael Lazaridis alleging that governments are politicizing the issue. Canadian and U.S. government officials, including U.S. Secretary of State Hillary Clinton, have even stepped to facilitate negotiations between the BlackBerry maker and foreign governments.

This latest confrontation with India comes on the heels of an agreement that RIM made with Saudi Arabia, letting authorities monitor communications passed over its BlackBerry Messenger service.

Regulatory challenges have threatened to derail RIM’s growth on a global scale as it continues to expand in foreign markets. Any BlackBerry restrictions in India, which has more than 635 million phone users, second only to China, could curtail significant revenue potential for the company.

These international difficulties comes at a pivotal moment for RIM as the smartphone market grows increasingly crowded with competitors such as Apple’s iPhone 4 and Google’s Android platform.

Earlier this month, RIM unveiled the BlackBerry Torch in an attempt to regain market dominance.

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