In the era of BYOD (bring you own device), many corporate IT departments struggle with how to manage all the different devices in a safe environment. It's not just about smartphones anymore, but all types of devices such as tablets.
Blackberry has been in this business forever and in fact, the reason Blackberry was the mobile enterprise icon of its day is because it was the only company that offered a simple and secure environment for corporate phones.
But with the evolution of the smartphone and the plethora of devices and platforms, there arose a need for multi-platform secure device management. But because BlackBerry phones were out of date and out of style the past couple of years, employees started using different devices and this became an IT manager's nightmare.
But because necessity is the mother of invention, many companies developed products to fill the BlackBerry void.
One such company is MobileIron. More or less this company has developed a service to handle multi-OS device management. And from the looks of it, they are doing a very good job.
We read from a recent announcement:
MOUNTAIN VIEW, Calif. - January 22, 2013 - MobileIron, the leader in security and management for mobile apps, documents, and devices, today announced massive growth in 2012, tripling the number of new seats sold in 2012 compared to 2011. Customer acquisition continued to accelerate as the company added more than 700 enterprise customers per quarter. MobileIron also saw significant expansion within its customer base as companies placed more than 1400 add-on orders.
I'm impressed. In fact Mobileiron has even developed an app to make a phone behave with a different persona, such as BlackBerry Balance.
But there many other companies in this space. In fact the more I searched the more I discovered that Mobile Device Management or MDM, is a thriving business with explosive growth. The number of companies I found in the space is amazing. Some of the privately owned companies are:
But there are also many publicly traded companies in this business that will come of a surprise:
SAP (NYSE:SAP) offers the Afaria software platform that delivers centralized control of all mobile devices and tablets including iPhone, iPad, Android and BlackBerry, as well as the apps that run on them.
Please note, all of the above companies are direct competitors with BlackBerry (BBRY) in the MDM space. So where does BlackBerry fit in this picture?
Most of the companies mentioned above offered secure network services years ago for groups and for networks. So when the smartphone came along, they simply adapted and added to their product mix smartphone security and management.
But BlackBerry is the company that revolutionized this business and they probably had the biggest footprint in the industry at one point. Like I said in a previous article, revenue from the service side of BlackBerry's business did not decrease. To be honest, I didn't understand exactly why then, but I understand it today. Security and network management is very important and companies pay for it.
BlackBerry however is the only company that commands both the hardware and the software side of the smartphone space. What this means is that the Z10 will have security functions that other companies by default can't have, because they don't have total control of the hardware as BlackBerry has. In other words, this means a more secure and better software experience.
The second is the shear size of the MDM business. The companies I listed above are not all that I found. I left out several companies from the U.S. and I left out all non-U.S. companies.
So since there are so many companies in this space, this must be a multi-billion dollar business. And since BlackBerry at some point in the past had a big chunk of this business, I think they have a very good chance to get some of it back again. Also remember that the MDM business today is many times the size it was just 2-3 years ago. The MDM services business is big enough for everyone to make money.
With BYOD policies in place, MDM has become a big issue in many companies. And while there are many players in the space, none have total control over the software as well as the hardware like BlackBerry.
Also, with the explosive growth of smartphones, MDM is not a luxury, but a necessity. And since BlackBerry was once the leader in this space, I think we can look forward for the company to command a big percentage of this business in the future once again.
I think that if the Z10 sells enough phones in the enterprise over the next twelve months, then Blackberry's MDM offering (BES10) will also be a success. And longer term, I think we will all be surprised by the amount of service revenue Blackberry does.
As per the buzz about Home Depot's decision to offer 10,000 iPhones to the company's executives, Amy McDowell of BlackBerry in an email replied:
We have over 2,700 unique businesses in North America already registered for our BlackBerry 10 Ready Program. We are confident that BlackBerry is, and will continue to be, the best solution for corporations managing large smartphone deployments.
I second that.
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.