February 13, 2006

Microsoft Targets RIM Blackberry With Price

By Antone Gonsalves

Courtesy of

Microsoft Corp. on Monday unveiled carrier and device support for its mobile messaging technology that the company hopes will attract customers through lower prices and more features than rival Research In Motion Inc.'s popular Blackberry

The Redmond, Wash., software maker announced at the 3GSM World Congress in Barcelona, Spain, that its "direct push" technology is available in Microsoft Windows Mobile 5.0 and Microsoft Exchange Server 2003 Service Pack 2. The technology also has been integrated into Microsoft Windows Small Business Server, and is offered as a hosted service by mobile operators U.K.-based Orange, Vodafone Group PLC, T-Mobile International AG & Co. and Cingular Wireless, jointly owned by BellSouth Corp and AT&T Inc.

In addition, Microsoft said four devices are currently outfitted with direct push, including Hewlett-Packard Co.'s iPAQ hw6900 Mobile Messenger, Gigabyte Communications's G-Smart, offered by Chunghwa Telecom Co. Ltd. in Taiwan; the ASUS P305 3G-enabled smart phone, and the Fujitsu Siemens FS Pocket Loox. HTC Corp. plans to have direct push-enabled devices available globally through T-Mobile and other operators in the second quarter of this year.

RIM's Blackberry email device remains the market leader with a loyal customer base. Microsoft, however, is looking to undermine the Canadian company's position through lower prices, Peter Pawlak, analyst for Directions on Microsoft said.

"They would like to get these devices in the hands of people beyond those RIM has been able to reach," Pawlak said. Europe, for example, could be a strong market, since RIM has been primarily successful in the United States.

Customers using Windows Mobile 5.0 and Microsoft Exchange Server 2003 for managing email accounts get the technology for sending and receiving corporate email on handheld devices at no additional charge. To get the same capabilities from a competitor, corporations may have to pay several thousand dollars for a mobile-email server.

In addition, companies can provide sales staff and other employees access to contact and calendar data from the company's Outlook email client.

In the future, Microsoft could offer a lot more than RIM, such as instant messaging and even Pawlak said. In addition, Microsoft has tools for independent software vendors and companies to build their own applications.

There's also expected to be a lot more devices available with the Microsoft platform than with RIM's, which means more competition and potentially lower prices.

"The Microsoft platform is very competitive with RIM devices, and is attractive as a lower cost alternative," Pawlak said.

Nevertheless, Microsoft will have to work to surpass RIM. The company in the first quarter of last year became the leading global seller of personal digital assistants with a 20.8 percent market share, About 90 percent of Blackberry sales are in the enterprise.

To a large part, Microsoft's success will depend on convincing more enterprises to deploy Exchange Server 2003 and attracting other big-name hardware manufacturers, such as Dell Inc., Gartner said.

Both companies, however, have legal troubles related to their technologies. Visto Corp. has sued Microsoft, along with several other companies, for patent infringement, and RIM is fighting a patent infringement suit by NTP Inc. RIM, however, it has developed workaround technology in case it loses its battle against NTP.


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