The Blackberry banning virus is spreading all over the world, with countires starting to ban the service within thier borders after talks with Research in Motion, the Blackberry maker, broke down. The UAE and Saudi Arabia have already announced the banning of the service, with Kuwait, Indonesia, and India threatening to do the same unless certain conditions are met. The problem between the phone maker and these countries is that the countires want to setup proxy servers to moniter the Blackberry usuage (i.e. moniter emails, messages, etc.), which the company is refusing to do so. But there might be light at the end of the tunnel, as India may have reached an agreement with RIM, and Kuwait announced yestersday that RIM has agreed to block 3,000 porn sites.
This news led me to the question of the impact of the Blackberry’s ban on RIM’s earnings. The biggest market for the Blackberry is the US, followed by Canada (home of RIM), then the United Kingdom. The rest of the world contributes to 27% of the company’s revenues. The UAE and Saudi Arabia contribute a very small part of that, thus the ban in these countires has a minimal effect on the company’s earnings. However, India and Indonesia are both a bigger threrats. The two countries, two of the most populus countries in the world, contribute more to RIM, and represents a very ripe environment for future growth.
My bet is the effect of the ban on the local telecommunication companies is far greater than on RIM. Also out of the four companies (STC, Etisalat, Mobily, Du), Du and Mobily will be affected the most as these two companeis are concentrated within the UAE and Saudi Arabia, respectively, as STC and Etisalat have large busniess operations spanning through numerous countries.
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Loading ...Tags: Blackberry, Blackberry ban, Research in Motion, RIM, Saudi Arabia, UAE
Great article very informative! thanks for sharing.
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Estimates say that there are about 750,000 BlackBerry subscribers in Saudi Arabia, and 500,000 in the UAE. Keeping in mind that in Saudi Arabia only the BBM service is going to be blocked. The business users will probably keep their services running while the BBM addicts might probably keep the regular service and start texting like crazy. Nonetheless, texting revenues might actually supplant some of ban affect. Also, there’s always a substitute for blackberry..I don’t see telecom companies being hurt that much, unless they’re selling the devices.
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Saudi Arabia has come to an agreement with RIM therefore they will not be a disconnection of service for blackberry users
The ball is in the UAEs hands now
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