India Threatens to Shut Down BlackBerry Service
India is playing hardball with Research In Motion, giving the BlackBerry maker an Aug. 31 deadline to address and resolve the government's security concerns or else risk having service terminated in the world's second-most populated country.
Government officials reiterated the deadline Thursday, according to a Reuters report, giving the Canada-based RIM (NASDAQ: RIMM) roughly three weeks to work out a compromise with India as it did last week with Saudi Arabia when service for some BlackBerry users was shuttered for roughly four hours.
At issue is how governments such as India, Saudi Arabia and the United Arab Emirates, which was the first nation to issue the ultimatum and is still sticking with an Oct. 11 deadline of its own, can tap into and monitor mobile communications traffic for national security purposes.
Officials for those countries as well as those in Indonesia and Lebanon argue that RIM's encryption technology combined with the physical location of its servers (many of which are in Canada) makes it all but impossible for their security agencies to monitor BlackBerry correspondence for possible terrorist activity or other illicit communications.
"Our message to RIM and service providers is that if they don't come up with a technical solution by Aug. 31, then the home ministry will take a view and will shut down BlackBerry Messenger and business enterprises services," a spokesman for the Indian ministry said in a statement to Reuters.
The government also said mobile phone operators would by law have to shut these services if Research In Motion (NASDAQ: RIMM) failed to meet their demands.
Saudi Arabia backed off its threat to shut down BlackBerry service last week after the kingdom's Communications and Information Telecommunications Commission said it was given unspecified commitments from operators and RIM that would aid in the countrys plan to monitor encrypted traffic on BlackBerry smartphones.
"In light of the positive developments in completing part of the regulatory requirements from the service providers, the regulatory authority has decided to allow the continuation of the BlackBerry Messenger services," the ministry said in a statement.
Ban Threats Spread Across the Globe
Meanwhile, RIM officials were busy doing damage control this week to assuage concerns that the company had caved to international pressure and abandoned consumers' privacy and free use concerns.
In a statement released late Thursday, RIM officials held firm to its position that carriers, regardless of the country in which they operate, must be technology and vendor neutral, allowing no greater access to BlackBerry consumer services than regulators already impose on RIM's competitors and other similar communications technology companies.
"RIM assures its customers that it genuinely tries to be as cooperative as possible with governments in the spirit of supporting legal and national security requirements, while also preserving the lawful needs of citizens and corporations," it said.
It added that it would make no changes to the security architecture for BlackBerry Enterprise Server because it's the same for all carriers around the world and, more important, RIM claims it cannot provide its customers' encryption keys.
"RIM maintains a consistent global standard for lawful access requirements that does not include special deals for specific countries," the statement concluded.
Last week, U.S. Secretary of State Hillary Clinton and Canada's Ministry for International Trade took up RIM's cause, using their considerable diplomatic clout to urge Saudi Arabia and other nations to work with the smartphone maker to reach a compromise.
"We are taking time to consult and analyze the full range of interests and issues at stake because we know that there is a legitimate security concern, but there's also a legitimate right of free use and access," U.S. Secretary of State Hillary Clinton said during a press conference last week. "So I think we will be pursuing both technical and expert discussions as we go."
The New York Times on Tuesday quoted a former BlackBerry executive who said the company had not disclosed encrypted contents of communications to any government in the Middle East or elsewhere to stave off the ban.
"RIM respects both the regulatory requirements of government and the security and privacy needs of corporations and consumers," company officials said in a statement released Aug. 4. "RIM does not disclose confidential regulatory discussions that take place with any government, however, RIM assures its customers that it is committed to continue delivering highly secure and innovative products that satisfy the needs of both customers and governments."
The inclination to ban or discourage use of the world's second-most-popular smartphone behind Nokia's Symbian devices has now spread to Europe, where the German government has begun urging staffers not to use the BlackBerry, according to another Reuters report, and the European Commission last week opted not to make the BlackBerry the smartphone of choice for its employees.
The threats have taken their toll on RIM's stock price in recent months. Trading at $71.53 in May, the stock plummeted to a 52-week low of $ 47.90 in early July but has rallied back a bit to trade around $55 a share this week.