Why Research In Motion Likes UMA

by: Dean Bubley posted on: May 25, 2008 | about stocks: NOK / RIMM    
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I got an interesting email from UMA Today quoting Research In Mothion (RIMM)'s CEO at a recent investor conference:

Speaking at RIM's 2008 Capital Markets Day on May 12, Jim Balsillie, co-CEO of Research in Motion [RIM], took the opportunity to acknowledge the tremendous progress UMA has made in the market. “Wi-Fi UMA is going remarkably well," he remarked. "It’s very compelling...This is happening, and it's happening fast."

"Some [carriers]saw it as a threat. I saw it as an enabler, an inevitability. In a sense, its hard to find a carrier that isn’t excited about it now." And he went on: "I think it’s just so compelling and so inevitable.”

The key word here is "carrier". RIM's entire business model is based on the concept of the carrier always being in control (albeit with RIM's network ops guys sitting behind them). RIM does not sell "vanilla" smartphone devices direct to end-users, like Nokia (NOK) or HTC.

So although RIM puts WiFi into its devices, it only permits its use at the carrier's discretion. It's not possible for a company to buy 1000 unlocked BlackBerries from a distributor, configure the WiFi to work with their Cisco (CSCO) IP-PBX with an FMC client, and then source 1000 SIM cards from whoever it likes.

Nokia takes the view that this approach is as valid as selling via the operators. RIM only plays one half of the market - and although obviously the carriers like this philosophy, it isn't the whole story.

This is why RIM likes UMA - it is perfect for devices which only feature "operator-controlled" WiFi. It is very far from perfect for those that sell devices that allow direct WiFi control by the end user.
This article has 3 comments! Add yours below...

Dean Bubley

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This article has 3 comments:

  •  
    Kris Tuttle
    May 26 11:30 AM
    My Website
    That's true but... some carriers (like T-Mobile at least in the US) are doing a decent job of enabling functions to work over any available Wi Fi connection. This makes traveling with a something like an 8820 very effective for many of us that don't want to spend money but still need coverage outside of Wi-Fi.
  •  
    debtfree
    May 26 07:33 PM
    doing what you suggest "allow a UMA device to access corporate network" would provide a huge productivity boost to enterprises. The reason this is not being done is that your Corporate IT decision maker is not comfortable with such access over the wifi part, RIM already provides access to corporate e-mail via 2g.

    also which carriers are interested in this? upto now its only T-Mo US, Orange and Rogers. IS THERE ANYONE ELSE?????

  •  
    Texrat
    May 27 07:31 PM
    My Website
    How about this instead: the FCC and FTC do their jobs, force TRUE cell service competition in the US, and we device owners get complete freedom to use our toys as we see fit. You know, that crazy model Nokia pushes that works in other parts of the world.

    Oops, I'm sorry, I had a momentary lapse of blind consumerism.
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