BlackBerry: The Killer Punch Will Be Security

| About: BlackBerry Ltd. (BBRY)

What happens when the number one information sensitive organization in the world -- the U.S. Army -- all of a sudden realizes that it has a security hole bigger than the holes in Swiss cheese?

What has to be done when the inspector general of the Defense Department says that the Army's Chief Information Office/G-6, has lost control over commercial mobile devices within the Army, and that more than 14,000 smartphones and tablets are untracked?

According to a recent report from the DOD IG:

The Army did not implement an effective cyber-security program for commercial mobile devices (CMD's). If the devices remain unsecure, malicious activities could disrupt Army networks and compromise sensitive DOD information. The Army CIO did not implement an effective cyber-security program for CMDs. Specifically, the Army CIO did not appropriately track CMDs and was unaware of more than 14,000 CMDs used throughout the Army (excludes BlackBerry devices).

One of the important areas of concern for the DOD IG is mobile device management. The DOD IG specifically wants the capability to remotely wipe data stored on CMD's that were transferred, lost, stolen or even damaged.

Well we all know that BB10 enterprise server has those capabilities built in. The BlackBerry (NASDAQ:BBRY) Z10 can have two persona and information departments can update apps, lock information or wipe clean sensitive data from a mobile device when needed.

In fact with the BlackBerry platform, IT departments can push data to both the Z10 and the Playbook tablet, manage multiple operating systems, multiple platforms, mixed ownership devices and have total control over security and app management with full BYOD support for the end user.

As a result, the Army and Defense Information Systems Agency (DISA) wants to develop a mobile device management process to verify that users of CMDs are following Army and DOD information assurance policies. The platform must be able to manage, observe and manage applications running on CMD devices.

The Army issued a request for proposals, and a contract award is expected this month, with initial operating capability expected by October 2013. Eventually the system will be able to manage and enforce security for about 8 million devices.

I only know one company that is really up to such a task and that is BlackBerry. So I will make a prediction - I think BlackBerry will get this contract. And if it does, it will be an eye-opener for big multinational corporations that BlackBerry is the platform to have when it comes to security and device management. Furthermore, if BlackBerry does get this contract, I think that will also push other international IT defense departments to go in the same direction.

And one of the reasons why such a platform cannot encompass the iPhone is this. According to a new study from Sourcefire, that depicts vulnerabilities and or software flows, the Apple (NASDAQ:AAPL) iPhone has the greatest number of vulnerabilities at 81%, followed by Google Android (NASDAQ:GOOG), Windows (NASDAQ:MSFT) and BlackBerry.

Well I have to say I was just as surprised as you, but I think it is only natural that one of the most popular phones in the world would attract the attention of all those who would want to find ways to exploit it.

Bottom line

Since BlackBerry has all of the security features that the DOD IG needs, I think BlackBerry will get the contract. If it does, it will be a big thumbs up for BlackBerry and will also be a big boost for the company. For one thing, it will set the security standard by which everyone will be judged from now on.

It will also mean that the BlackBerry platform is the way to go -- both for handsets and tablets -- for whoever is serious about security from now on.

Remember, BlackBerry does not need to become Apple in order for shareholders to make money. The company can do just fine being a niche player in the space with very high margins.

Also note that BlackBerry was the corporate smartphone icon until just a few years ago.

While Apple and the Google Android platform evolved and took the market by surprise (until recently that is), it will not take a lot for BlackBerry to become the corporate smartphone icon once again, if more companies take security more serious. And if BlackBerry gets this contract, many more companies will.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.