Research In Motion Ltd (RIM), whose BlackBerry smartphone faces ban in Saudi Arabia and Indonesia, risks losing out on expansion in emerging markets after saying it won’t reveal codes for reading users’ communications.
RIM can’t meet requests for customers’ encryption keys since it doesn’t have the codes, the company said in an e-mailed statement today. There is “one BlackBerry enterprise solution available” and claims that RIM provided “something unique to the government of one country” are unfounded, it said.
Saudi Arabia, the Arab world’s largest economy, ordered phone companies operating in the kingdom to suspend BlackBerry services starting August 6, and Indonesia today threatened to ban some functions on the devices. The moves follow a decision this week by the United Arab Emirates, home to West Asia’s business hub, Dubai, to shut BlackBerry data and messaging functions the government can’t monitor. India, the second-most populous country, asked RIM to host a server in the country or be banned.
“The company is in a pretty tricky position now,” said Matthew Reed, a senior analyst for West Asia and Africa at UK business data provider and publisher Informa Plc. “Part of the BlackBerry’s appeal is that it offers high levels of security and that same factor is what’s getting it blocked.”
RIM, expanding outside North America to counter slowing growth in the US, is facing mounting challenges as developing countries tighten restrictions on mobile communications. States such as the UAE and India have cited a need to monitor calls and e-mails for security, as well as to uphold social mores, as reasons for a potential ban on the services.