I'll say right up front, it certainly is an interesting question, but should Google pull the trigger? Research In Motion is in total disarray and another bad comment or two from one of their co-CEO's could cause RIM to drop in to a total free-fall.
Some in the press have declared RIM to be already dead while others think the co-CEO's need to go. Still others see RIM as being the next Palm while the government thinks that RIM broke securities laws and they've set out to prove it. And that's all from this month.
When you combine all of that horrible press and possible legal trouble with a complete and utter failure to deliver an even mediocre device it becomes pretty clear that RIM is up against the ropes. Who is beating RIM into submission? Well, that would be the iPhone and Android devices, and soon enough Windows Mobile devices from a plethora of manufacturers.
To be sure, there are a number of key advantages that RIM has with it's enterprise offerings that would make them a very attractive target for Google. We're going to take a look at this key enterprise angle and then look at why Google should or should not take on this deal.
Blackberry Advantage #1 - Control
The centerpiece of the Blackberry communications platform is the Blackberry Enterprise Server and it is the prize that Google would be after in a buyout.
BES is an on-site or managed server that not only handles delivery of email, it also does an excellent job of syncing contacts, calendars and notes to the devices that are connected to it. Further, it acts as the gatekeeper for each device individually, controlling it's every feature and function remotely through the use of security policies that are installed on the device.
Corporations that issue Blackberry devices to their employees can use BES to establish allowable uses for each phone on their system. There are over 400 different security policies that can be controlled by BES, including some of my all time favorites:
- Internet access
- Website blocking
- Deny application install
- Limit apps that can be installed
- Limit features of installed apps
- Allow/deny instant messaging and PIN messaging
- Block SMS/MMS messaging during set hours
- Specify file types that can be emailed from the device
- Specify file types that can be opened on the device
- Block access to music and video files
- Limit when phone calls can be dialed
That last one was the one that I had the most fun with. I had a company issued Blackberry many jobs ago and the owner didn't allow phone calls after 7PM, even though he always made a habit of calling me after 9PM. Now, I'd never answer the phone when he called because, well, if you're not paying me to talk to you then I'm not going to, and he wasn't paying me. He'd ask why I never called him back and I'd always say YOU WOULDN'T LET ME! Besides, the stupid phone went in my glove box the minute I got in my Jeep.
Anyway. Where was I?
Your corporate BES can be set to not only store all email that is sent and received on the device but to also archive any and all SMS and MMS messages that are sent to the phone or from the phone. In short, BES is the perfect example of a communist's wet dream; we can see and control anything and everything that you do on your device. That is, if we have allowed you permission to do it.
Blackberry Advantage #2 - Encryption
From the moment that a Blackberry Enterprise Sever picks up an email message the data is encrypted, including the storage on the device itself. Likewise all contacts, calendar entries, notes, documents, spreadsheets and any other data that is stored on the device is encrypted. Locked down encrypted.
Imagine losing your device with all of your company's deepest, darkest secrets stored neatly right there in your email inbox. If it's a Blackberry and your BES is set to enforce encryption (which they all are by default) everything is fine. Anyone that finds it won't be able to access storage by simply plugging it in to a computer, and a few wrong PIN entries on the welcome screen causes the phone to wipe itself. Once the wipe begins it only takes a few minutes and the phone is clean. Further, once a wipe has started you can't stop it.
The RIM Wildcard - Patents
Patent infringement lawsuits make the technology world go round and sometimes the best defense against these nuisance suits is a good offense. Relative to RIM's patent portfolio Google's mobile patent cupboard is bare.
RIM has been granted or acquired license to tens of thousands of patents across the technology spectrum. Google has made no secret of the fact that they desperately want to strengthen their patent portfolio in support of Android and including the RIM patents in the bucket, Android would be better insulated from infringement suits.
With an offer of nearly a billion dollars on the table to acquire the Nortel patent portfolio Google's intentions are clear. Patents alone would not make RIM an attractive buy in my opinion, but with the other assets included the value becomes pretty clear.
Why Google Should Do It
Buying up RIM would give Google an instant credibility boost with enterprise customers, and frankly that is the only real consideration in my opinion. Data security is key in the enterprise and as good as Google Apps is, it is seen as a security threat on multiple levels. Many businesses are afraid to use it, while many others don't trust Google with unfettered access to anything that their employees do with Google Apps.
BES wouldn't totally alleviate these concerns, but it would go a very long way in closing the gap. Offering server level encryption of all email, calendar and docs data stored on Google servers combined with a local backup and BES encryption could well turn the tide in Google's favor.
There would also be another huge side advantage to a buyout; paying customers. I believe that Google would love to expand their revenue generating capabilities beyond ad sales. With it's 100 million or so users on BES or it's consumer focused Blackberry Internet Service (BIS) cousin, RIM would be a nice add to bottom line.
Why Google Shouldn't Do It
Are you kidding me? Why would Google want to ingest RIM?
Well, beyond just stating the obvious let me give a few reasons why Google shouldn't even consider RIM.
- Fragmentation - The differences between the current OS 5 & 6 makes Gingerbread and Honeycomb seem like identical twins. Aside from that, hardware fragmentation makes developing for Blackberry OS incredibly difficult. Many developers shy away from BB OS and a great number of apps are developed in-house by RIM. Facebook app? RIM. AIM, Google Talk, Yahoo Messenger? RIM. Twitter app? Yep, developed by RIM.
- Deeper Fragmentation - RIM is set to roll out Blackberry OS 7 at some point later this year and most devices, including some that are being sold right now, won't be compatible.
- Deepest Fragmentation - In 2012 RIM will release QNX for handheld devices. That is the total webOS ripoff OS that powers the absolute failure of a tablet, the Blackberry Playbook. And guess what, you'll need another new device if you want to run it on your phone. This schizophrenic OS roadmap would be a whole smelly bag of hurt for Google.
- Legacy Hardware - There is no way that Google would be able to just walk away from the current base of installed Blackberry users. Committing to support these devices is not something that would benefit Android in any way and would be a huge distraction.
- That Stupid Tablet - Again, Google would have a very hard time just dropping the Playbook without risking blow-back from the users that have already bought the device. Thankfully there aren't many buyers, but I can name a number of Fortune 50 companies that have deployed them.
- Hardware Encryption - While encryption might be a big plus for RIM it would be a total nightmare for Google. Getting device manufacturers to update their OS versions is hard enough, imagine trying to talk Moto, Samsung and HTC in to releasing a vanilla phone with hardware encryption built in. No whiz bang features or deep customization. Just a device with a screen and hardware encryption. Good luck.On the flip side Google could rebrand the Blackberry as the Nexus line and manufacture their own hardware, but then you're pissing off the previously mentioned partners that grew your little green bean into the robot monster that it is today.
- A Brand in Decline - Look at any mobile OS market share report that you care to and you'll see that the one company in a free fall is RIM. Fewer built in BES users makes this a tough pill to swallow.
- RIM is Expensive - With a market cap near $30 billion RIM is out of reach for Google. By the time the value drops to the $15 billion range the vultures will be over head. Microsoft is the company that would benefit most from a RIM acquisition and in my opinion they are the likeliest buyer.
Will Google Do It
Google has never shied away from the big deal. They've bought YouTube, Double Click, AdMob and ITA to name just a few, but all of these deals combined don't add up to what RIM would cost.
In thinking about technology assets and patents as a basis for Google's potential interest in RIM there are clues that exist in Google's other moves, or put better, lack of moves.
Java is at the heart of Android, yet Google sat back and watched Oracle buy Sun for relative pocket change compared to RIM. Java carried with it lots and lots of patents when Sun sold out for $7.5 billion. A direct buy of Sun would have insulated Android and the Dalvik VM from all of this Oracle nasty business, but Google folded their hand. Hell, Google was more interested in buying Groupon for $6 billion.
I'll start the vote; I say no way. Too expensive. Too many negatives. Not enough positives. Google will take a pass and let Microsoft and others chase this rabbit down the hole.