Research In Motion's BlackBerry wireless e-mail device has enjoyed a competition-free market for quite awhile. Over the past few months, a number of new products have started to appear with similar functionality, but will they be able to challenge the market leader?

The BlackBerry is everywhere these days: the wireless e-mail device from Research In Motion (www.rim.com) has become a required accessory for senators and corporate executives from D.C. to California and beyond. Still, a number of startups and established technology companies have finally noticed that RIM has this market to itself...and they're starting to offer their own competing solutions.

Check out the Web sites for any of these new offerings, from the Handspring Treo to the Palm i705, and you'll see a hyperlink somewhere on the page that reads, "Compare to the RIM BlackBerry." Each company is more than eager to show you a long list of reasons why their new product beats the old one, hands down.

At the same time, the executives at RIM aren't flinching; instead, they've been making a series of new product announcements. Thanks to a deal with Ericsson, the new RIM BlackBerry 5810 adds GSM/GPRS voice capability to the device, and RIM recently announced similar products for CDMA/1xRTT and iDEN networks, as well as wireless access to enterprise applications and data.

David Werezak, RIM's vice president of marketing, says the company isn't concerned about any potential competition, since there's nobody else offering RIM's combination of voice and data with an end-to-end solution for secure wireless connectivity. "We're unique technically in that we're doing both packet data and circuit-switched data at the same time, and it's real: it's in the market today," he said.

But that's not keeping anyone from trying.

Shots into the Bow
According to IDC analyst Alex Slawsby, the most direct competition to the BlackBerry comes from Good Technology (www.good.com), a startup whose key offering is a solution developed to replace the BlackBerry Enterprise Server. "You've heard of shots across the bow: this is a shot into the bow," he said. "Their Web site shows a RIM handheld with Good running on it. You can't get much more blatant than that."

Andrea Cook Fleming, Good's vice president of marketing, says that the Web site is simply intended to point out that Good is a system provider, not a hardware provider. The GoodLink system runs on RIM devices as well as Good's own device, with Pocket PC and Palm OS offerings planned for the future. "We're multidevice, and to prove it, we shipped on the other guy's hardware first," Fleming said.

The company's GoodLink Server offers much of the same functionality as RIM's BlackBerry Enterprise Server, but improves upon the RIM product in a number of ways. These improvements include eliminating the need to install any desktop software, supporting a range of different devices, and doing all synchronization wirelessly.

This last benefit, eliminating the need for a cradle at the desktop with which to sync the device and the server, is the most significant. "One of our board members jokes that cradles are for babies," Fleming said. "You get a continuous two-way sync, and you're never cradling the handheld to achieve that, so your handheld is always up to date."

Good also has a device offering planned ­ the Good G100. While Fleming stresses that Good doesn't want to be a hardware company, she says they felt there wasn't enough innovation happening for data-only devices. The G100 makes some adjustments to the RIM BlackBerry, including an improved keyboard and the addition of an ambidextrous scroll wheel at the center of the device.

Despite the promise of Good's offering, Yankee Group analyst Sarah Kim warns that the company may have some significant obstacles in the way. "RIM sales aren't like Palm sales: you're going through a central CIO or CTO, you have to roll it out, you have to do tons of things that make RIM more sticky than a typical device-only purchase," she said. "To oust that kind of purchase is ambitious."

Still, RIM is taking the challenge seriously ­ and so is Good. In May, Good Technology filed a preemptive suit against RIM, challenging the company's right to its patent for a single unified e-mail technology. And in June, RIM responded with a suit against Good, charging the company with violation of four of its patents.

In the meantime, though, Fleming contends that Good Technology isn't just trying to steal RIM's customers; she says there should be room for more than one company in this market. "There are something like 11 million mobile enterprise workers, but only 300,000 BlackBerry subscribers," she said. "That's very, very small penetration; it's a wide-open market."

A Colorful Choice
Another company that's working to position itself as direct competition to the BlackBerry is the Palm OS device manufacturer Handspring (www.handspring.com). The company's Treo 270 Communicator combines a Palm OS device with a BlackBerry-style thumb keyboard and a GSM phone. Both a CDMA product and a GPRS upgrade are expected soon.

On a basic level, the Treo has a lot going for it. David Williams, Handspring's senior product manager for Wireless Software, says the choice should be obvious. "You can pay $499 today for a BlackBerry device, or you can pay $499 today for a Handspring Treo with a color screen, Palm OS compatibility, and a very well-integrated mobile phone," he said.

While Handspring itself doesn't offer a back-end enterprise solution for corporate e-mail to match RIM's offering, a number of its partners do. Visto Corporation's Visto Mobile Access Solution provides a push e-mail service that's meant to compete directly with the BlackBerry Enterprise Server. And as Williams is quick to point out, it even offers some advantages: while RIM uses 3DES security, Visto uses AES encryption.

Handspring spokesperson Julie Staska adds that a company could also consider taking on both the Treo and the BlackBerry. "You wouldn't necessarily have to completely change your infrastructure, depending on how you deployed your BlackBerry," she said. "By going with a partner like Wireless Knowledge, Synchrologic, or Extended Systems, you can open your business to be able to support multiple devices."

Williams readily admits that Handspring has long focused on the consumer market rather than the enterprise market, but he points out that executives can be consumers, too. "Our focus has been on the business consumer," he said. "Most companies don't make the purchase decision: the employee usually buys his or her mobile phone and organizer."

The Yankee Group's Kim applauds Handspring for the bold jump it made in shifting to the Treo, but she warns that it may not pay off. "They've positioned themselves in a market where all the players they're playing against are much larger fish: Nokia, Samsung, and Kyocera," she said. "In the short term, they get the prize for innovation, but in the long run, I'm not so certain about their viability."

Banking on Ease of Use
Palm (www.palm.com) also has an entrant into this space, the wireless-enabled Palm i705, priced just below the BlackBerry. It may not have the Treo's color screen, phone capability, or keyboard, but according to Ken Wirt, Palm's senior vice president of marketing and product management, that's simply a matter of focus. He contends that most devices that support both voice and data end up compromising on both functions.

Instead, Wirt says, Palm is trying to make the best possible use of its operating system and display size. "Palm is focusing on data-centric solutions, and we see voice as an added application," he said. "In the enterprise, mobilizing corporate applications is the next wave in increasing company productivity, and wireless devices with larger displays are best-suited to meet these mobile data needs."

Thanks to Palm's acquisition last year of the wireless application provider ThinAirApps, the company now has a range of new enterprise solutions in the works. The Palm Wireless Database Access Server provides a secure wireless connection to enterprise data, allowing employees to access key applications while on the road, and a similar server is planned for secure e-mail access.

Jonathan Oakes, Palm's director of enterprise strategy, says the idea is to make mobile data access a simpler proposition. "Palm wants to extend the same ease of use that has made them so successful in the handheld industry into the mobile enterprise applications space," he said.

Still, in working to attract enterprise customers, Yankee Group's Kim suggests that the company still has a lot of work to do. "For all these years, people who bought their product had jobs, and they all took it to work," Kim said. "Now they need to figure out who those people are, and how they can convince the rest of their company to make an enterprise decision."

Danger on Your Hip
Another consumer device with enterprise potential is the hiptop by Danger (www.danger.com), which is expected to be available on the VoiceStream network within the next few months. The hiptop's form factor has clearly taken some lessons from the BlackBerry. Built to open with an intriguing twist, the case encloses a BlackBerry-style keyboard underneath the screen.

One of the most striking features of the Danger hiptop is its low target price point. At under $200, it's less than half the price of the BlackBerry, the Treo, and the i705. Renee Niemi, Danger's vice president of marketing, explains that the founders all came from companies where they worked to deliver technology to consumers. They founded Danger, she says, to bring the data functionality of the BlackBerry to the consumer market.

"When you look at the younger demographic that Danger targets, the 18­34 year olds, the market is actually much more tuned to data," she said. "This is the Internet generation: they live and breathe technology. They're very data-savvy, and yet none of the products on the market were really targeting to deliver something useful to them."

And like Handspring's Williams, Niemi suggests that business consumers may ultimately provide a route for the hiptop to enter the business market. "When we all go home at night, we're consumers," she said. "Just because we've designed a product that's targeted at consumers, that doesn't mean that business users aren't going to buy them and use them."

Still, the hiptop is clearly designed with the consumer in mind. It comes preloaded with AOL Instant Messenger and a wide range of games, as well as full HTML Web access. "It gives you out-of-the-box functionality on Web surfing, out-of-the-box functionality on e-mail, and you get instant messaging working right out of the box," Niemi said. "You just boot it up, plug in your desktop AIM ID, and it works."

The biggest obstacle in Danger's way will be the challenge of getting carriers to support the product, and even Niemi admits that won't be easy. "We run on a GSM/GPRS network, and that really limits the number of U.S. launch partners," she said.

Ultimately, Niemi says, the idea is to offer the consumer market a product that fits somewhere between consumer phones and enterprise devices. "I really think that Danger has found a niche that has not been well addressed, though I suspect that it will be, moving forward," she said.

SIDEBAR:
The Burden to Evolve
IDC's Slawsby says that RIM has a lot of reasons to keep a careful watch on companies like Good Technology and Handspring, and these are just a few examples. "There are many more companies that are trying to one-up RIM in terms of device technology or solutions technology," he said. "The burden is even greater on RIM now to continue to evolve, to innovate, and to continue to be one step ahead of its rivals."

Such innovations, says RIM's Werezak, are coming in spades. "One of the things that we're helping customers develop is access not just to their e-mail, but to their corporate data as well," he said. "Maybe they have an SAP system that they'd like, or they're working with Cognos or PeopleSoft or Siebel: all of those can be wirelessly enabled and deployed over the same handhelds in a secure fashion. That enhancement of the core wireless e-mail value proposition of BlackBerry is becoming very, very popular."

And as RIM makes such changes, it has one enormous factor on its side. As the Yankee Group's Kim notes, the current economic environment means that being slightly behind a competitor like Good Technology may just not matter. "If a company is happy with RIM but also knows that Good is better, it's not necessarily going to make them want to switch right away," she said.

Still, while the current state of the economy may be helping RIM in some ways, it's also causing some losses."Turn-off rates are a problem right now for RIM," Kim said. "The key executive types are the ones who get access to RIM devices at an organization, and then it's usually those people who are being fired. It's a hard market for anyone."

Regardless of the outcome, IDC's Slawsby says, it's going to be an interesting market to watch over the next year or two. "I don't think RIM's going to let go without a fight," he said. "They've got some stuff out now and on its way that should very aggressively try to maintain and even grow that niche, and we think they're up to the challenge."

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