Software giant takes aim at BlackBerry’s large customer base
Microsoft recently announced partnerships with several wireless carriers to deliver push e-mail capability for mobile devices, a move which is designed to compete with Research in Motion’s BlackBerry platform.
Microsoft’s announcement could not be timed better, coming in the midst of a lawsuit that threatens to shut down BlackBerry service in the United States.
Microsoft Corp has won backing from major cellular networks for a new generation of phones designed to transform mobile e-mail from executive accessory to standard issue for the corporate rank-and-file.
The partnerships with operators including Vodafone and Cingular, announced at a mobile industry gathering in Spain, could spell more trouble for the embattled Blackberry and other niche e-mail technologies, analysts say.
The world’s biggest software firm unveiled the operating system, called Windows Mobile 5.0, at the 3GSM World Congress in Barcelona. The system, which will be compatible with Microsoft’s popular Exchange server, will "push" e-mail messages to the phones in much the same way as RIM’s software sends e-mails to the Blackberry.
Unlike the Blackberry and its peers, phones running Microsoft’s latest Windows Mobile operating system can receive e-mails "pushed" directly from the server that handles a company’s PCs — without the need for a separate mobile server or additional license payments.
As costs fall, Microsoft is betting companies will extend mobile e-mail beyond top management to millions more of their employees.
Wireless carriers Cingular Wireless, Orange, T-Mobile and Vodafone, all announced a free Feature Pack upgrade that enables push e-mail for customers who have devices that run Microsoft’s Windows Mobile 5.0 operating system.
At the same time, Hewlett-Packard introduced the HP iPAQ HW6900 Mobile Messenger, a handheld device that supports both cellular and Wi-Fi networks, in addition to including the push e-mail access capabilities from Microsoft.
Previous iterations of Microsoft’s mobile e-mail software have required users to synchronize their handhelds with corporate servers. With the push technology, e-mail is forwarded to their devices automatically.
Microsoft officials said the company’s push e-mail solution can be used for both, on-premises and behind-the-firewall corporate Exchange Server deployments and operator-hosted solutions for small businesses.
On the server side, Microsoft in October 2005 released Service Pack 2 of Microsoft Exchange 2003, which includes the ability to support push e-mail. Customers wanting to support the feature from behind their firewalls must upgrade their Exchange Systems to Service Pack 2.
We are at the tipping point of seeing exponential growth in this area, with a number of factors coming together to make this happen—from less costly and more varied devices to wider adoption of mobile data among mobile professionals, said Pieter Knook, senior vice president of the Mobile and Embedded Devices Division and Communications Sector Business at Microsoft in Redmond, Wash.
Microsoft laid the groundwork for its e-mail offensive with an October update to Exchange — which led the server software market last year with 48 percent of global sales, according to technology research firm Gartner.
Microsoft’s push e-mail offering will compete with software from Good Technology, Visto and, most notably, RIM, which built its success on push e-mail offerings and now offers support for other corporate applications as well.
Some observers have been predicting that the new technology will hurt the Blackberry’s maker, Canada-based Research In Motion Ltd.
RIM executives said they were not fazed by Microsoft’s plans.
RIM has posted stellar growth in recent years by jumping to the front of the wireless e-mail market and racking up lucrative fees from carriers and corporate customers to install the company’s e-mail software. At the end of its latest quarter, the company had 4.3 million BlackBerry subscribers.
But the cloud over the company has grown darker in recent weeks as a patent dispute with U.S. firm NTP Inc. comes to a head. A U.S. federal judge will decide later this month whether the Blackberry will be shut down south of the border.
This means the door’s been left open for others, including Microsoft, said Andrew Brown, an analyst with consultancy IDC.
I think most enterprise customers will continue to want a lot more today than can be accomplished through a service pack for wireless e-mail, said Mark Guibert, vice president of marketing at RIM in Waterloo, Ontario. We launched enterprise-grade wireless e-mail seven years ago, but we have continued to raise the bar for wireless e-mail since and our market is also about much more than wireless e-mail today.
Analysts echoed this sentiment, saying that large corporate customers may be wary of going with a pure Microsoft mobile e-mail deployment, largely because of security concerns.
"Microsoft has only seven or eight security policies to RIM and Good Technology’s 160 or so," said Ken Dulaney, vice president of mobile computing at Gartner in San Jose, Calif.
Furthermore, the hardware just is not truly competitive just yet and the client software is feature-poor, Dulaney said. For example, if I get a couple hundred e-mails on my phone I have to delete them one by one by one, Real pain.
Strand Consult, a Denmark-based IT research house, expects companies worldwide to invest in much broader mobile e-mail access for their employees in this year.
"Microsoft will most probably overtake RIM as the leading mobile e-mail provider," Strand wrote.
Mobile messaging prices are already falling. In the US, Cingular last year began bundling an e-mail service from Blackberry rival Good Technologies Inc with its unlimited wireless Internet package, at no extra charge.
Wireless access to e-mail, calendars and contacts — once the preserve of jet-setting executives and professionals in law and finance — is increasingly seen as a useful tool for a wider array of workers, keeping them informed and in touch when away from their desks.
Meanwhile, big competitors such as Nokia and upstarts such as Good Technology have been developing their own e-mail software to supplant RIM’s moneymaker. Industry observers had been expecting a new Microsoft offering for months, said Research Capital analyst Nick Agostino.
To promote the phones, Microsoft plans to launch a print and outdoor advertising campaign geared to business travelers in Germany, France, Spain, Britain and the United States.
However, Microsoft and Texas Instruments announced that several phone manufacturers are planning to build relatively inexpensive phones that run on Windows Mobile.
Amoi Electronics, HTC and Sagem Communication all are developing new Windows Mobile-based phones based on TI’s OMAPV1030 EDGE single-core chip set, Microsoft officials said. Most of the Windows Mobile devices on the market today use a more expensive dual-core chip set, which ups the price of the phone.
These more cost-effective Windows Mobile handsets should be on the market within the next 12 months, officials said.