RIM Out; BB10 In

Transcript for RIM Out; BB10 In

Dave Michels: Hi, this is Dave Michels, and welcome to the UCStrategies podcast. Today we're going to be talking about Blackberry's big news, and notice I said Blackberry and not RIM. Part of the big news last week on January 30 was that Blackberry has officially changed its name from RIM to Blackberry, and they have made a few other announcements, as well. They formally launched the Blackberry 10 product line which includes new hardware and a whole bunch of interesting points to cover in this podcast. So with that, I'd like to welcome our guests on this call. We've got Chris Wright from Blackberry. He's the Director of Channel Accounts. Welcome Chris. And we've got Ajay Malhan, Technical Solutions Manager. Welcome, Ajay and; John Cash, who manages Enterprise Accounts.

Thank you all for joining us on this podcast. We've got a lot of stuff to cover. It was a fairly big event with a lot of anticipation, a lot of build up going into it. We'll hit a lot of the major points as we go through this conversation. Let's start off the conversation with Steve Leaden. Steve, what is your take on some of these announcements that came out last week from Blackberry?

Steve Leaden: Well, Dave, to everybody from now Blackberry, congratulations. I watched the entire podcast, and I myself am a Blackberry 9900 Series user, and was very excited to see some of the new major announcements and enhancements, so thank you. My question is really threefold, and I'll just present all three questions; answer it as you wish. I found the dual persona available in the Z10 to be very interesting, where you can use it as both a corporate and a personal device. That has some tremendous leverage for the larger enterprise. My second question is BES 10 and how you may be able to incorporate not just only Blackberry users, but through active sync, Android, as well as Microsoft users around that, and possibly even iPhone. Finally, what do you see down the road? It was very interesting, a couple of months ago I saw a piece on General Motors, actually putting a stake in the ground, saying that within the next 36 months they expect to gain back market share based on some of the new announcements that are coming out. I'd like to hear your vision relative to the enterprise users, where you would see Blackberry in the next 24 to 36 months, knowing we have such a crowded market happening, and the pace of the mobility market moving at an unprecedented rate? With that, if you could hit on those three talking points, I'd appreciate it.

Ajay Malhan: For the dual persona it seems like you're referring to the Blackberry Balance functionality that’s available on Blackberry Z10, and actually all Blackberry 10 devices moving forward. Again, that's enabled through Blackberry Enterprise Service 10 (BES 10). Once a user enrolls the device to BES 10, what we've been doing here is creating a work perimeter on the device, and that's what you're referring to as the work persona, and really, giving the users that work versus person experience on the same device. With a single swipe gesture, you could actually go to the work mode, and have all your access to all you work data, your work applications, also the work channels. So, that's what we're doing, as well. We give you access to your work application, behind the firewall access, using that work container that we create on the device.

On the personal side, we allow the user to really take advantage of all the personal applications, browser access, or whatever content they wish to download from Blackberry World. That's completely opened up for them, but we ensure that there is no data leakage from the work side to the personal side, so effectively blocking any round-tripping from the personal side to the work side.

Steve Leaden: I understand you can wipe the phone on the corporate side, remotely, if the device is stolen, or whatever.

Ajay Malhan: Absolutely. Depending upon this being a personal liable implementation or corporate liable, we could do one or both. We could do just the work wipe, removing the work perimeter from the device, or completely wiping the device as needed.

Dave Michels: Does that work side and personal side make any difference about who owns the phone? Is this optimized from BYOD environments, or is it more around a corporate phone, and you could have some personal data on it?

Ajay Malhan: Great question. The Blackberry balance – the work and the personal implementation – was really designing for BYOD, so that's really catered toward that audience, which right now, is probably close to 70 percent of that market share. We also are looking at a fully corporate-owned solution which we will have available soon after, and that would be the fully locked-down implementation of Blackberry 10. Again, that will be available coming soon in the May timeframe.

John Cash: Ajay, I'll add to what you said, and I'll certainly agree with it and underscore the point with this balance feature that we're really the only mobile phone solution now that seamlessly presents that separation of work and personal data and applications. Other smart phone solutions may have some sort of a container solution that you can add to it, but it's not seamless, and that really is what differentiates our Balance solution on Blackberry 10.

Ajay Malhan: Great point, John. It's not that sandbox approach. We really give you much more flexibility. A good example would be that when I open up my messaging application, which is the Hub, I have access to all of my personal and work content within that hub. I'm not going into two different email applications. I'm not opening two different contact applications to access my work or personal contacts. What we're doing here is very smartly making data that's work data available only when you are authenticated to the work container. So, when you put in your work password, that's when you see work data. Otherwise it's invisible to you.

Steve Leaden: Back to the BES 10, where can a corporate enterprise take advantage of both Blackberry, as well as, if they've obviously within the last 24 months – 36 months, migrated to a droid, or an iPhone platform? How can BES 10 take advantage of that?

Ajay Malhan: That's also something that we have been working on for the last year. Last year, we introduced a product called Blackberry Mobile Fusion, and BES 10 really is the evolution of Blackberry Mobile Fusion where we are able to support not only the Blackberry 10 devices, we're also supported iOS and Android devices with the Blackberry Mobile Fusion. Now there is the difference in how we really support that implementation, but we are totally able to manage, and control, iOS and Android devices in addition to Blackberry 10 devices and Blackberry OS devices. In reality, you have a single glass pane, or a single management console to manage all your mobile devices today, from this one management console.

A good example I see a lot of times with the admins today is they have a combination of devices, so a very common combination that we saw in the past has been a Blackberry and an iPad. Traditionally, help desk would go to one backend system, to manage an iPad, and the other backend system to manage the Blackberry device. What they can do with Blackberry Mobile Fusion, and now BES 10, is just click on the user profile, and it'll present to you all the devices that are enrolled to the user, and that could be a Blackberry device, a Playbook tablet, a BB10 device. We really are managing the user and the attached device, and not a device on the back-end system. That's the approach here.

Steve Leaden: With security being the biggest issue out there in BYOD, along with, the enterprise at large, how would the BES 10 mobile solution, here with the Fusion included make for a better solution?

Ajay Malhan: When it's Blackberry-centric, we retain all the security, the secure DNA that we bring from BES 5 and BBOS, to BES 10. We have the end-to-end AES 256 bit encryption. We will also encrypt all the work data on the device at the time of device enrollment, so at rest, and in motion, your data is always AES 256 bit encrypted, and then, you have the additional controls to wipe work data as needed. That's available for Blackberry 10 devices, today and BBOS devices. We're looking forward to extend that to third-party devices in the future, as well.

Steve Leaden: Excellent. Okay Dave, back to you.

Dave Michels: Great. Thank you. I want to get over to Michael here pretty quickly, because I know he's got a lot of opinions around mobility. Michael, you and I have talked a lot about the pre-iPhone days; how RIM and Blackberry were so easy to build a strategy around, and that was a common lament with the iPhone, that Apple wouldn't respond to enterprises, or enterprise software vendors, and either did Google. Over the years, that ecosystem has developed itself now. Michael what is your take on enterprise requirements around how they embrace mobility and manage mobility?

Michael Finneran: Thanks, Dave, and thanks to the Blackberry, guys. It's great to have you on the podcast. A couple of things, first off, what I'd like to know about, and it's great that we have Chris on here to talk about Blackberry and the channel, but Blackberry's value proposition no longer seems to be unique in the market, with the move to BYOD, or all the MDM suppliers; Samsung coming up with their Safe Program... Of course, we have Good Technologies that has a security solution can work in conjunction with Boxtone.

The two core questions I have, is first for Chris. How are you expanding your channels beyond the traditional channel which is the mobile operator, and secondly, how does Blackberry now intend to differentiate themselves in what has become a very, very crowded market for enterprise mobility?

Chris Wright: I'll lead off by talking about our channel presence. In the U.S. and Canada, we've had a channel program, a traditional IT channel through distribution and our partners, for the past seven years. We were talking about mobile solutions and building mobile practices seven years ago, and people weren't really sure what we were talking about in those days, but at any rate, we've built a pretty solid standard channel program over those years. This includes not only products from a software perspective, but also, a lot of our maintenance products and tablets and hardware. Now there's channel play within the carrier community in the IT channel through master agent contracts, but for the most part, our value has been around the MDM platform or category, long before it was even called MDM. So we've been in the channel for a long time, and our partners that are efficient – we have over 4,000 partners, believe it, or not, in the U.S. The general big direct market players are obviously the key market-share holders in the total volume, but when it comes down to services, where the real margin’s made, it's very widely dispersed from a regional perspective, and those are the folks that are doing all the professional service around the maintenance of the platform, from installation, optimization, migration, things of that nature, and general consulting. There's a big move now from a mobility perspective on who that trusted advisor is, and it's reverting to the traditional IT channel, where mobility is becoming a managed platform. We're getting a lot of interest in the last three to four years around the revenue available around a mobility platform. RIM's resonated very well there, because it is middleware, and it does take maintenance. So our channel partners have played very well in this space.

From the perspective of differentiation, the immediate fact is that Blackberry is the most widely deployed MDM solution in history. Ninety percent of the Fortune 500 companies have deployed Blackberry, and still have it to this day. There's an immediate market out there to be serviced from our channel partners. We're getting all kinds of people asking about roadmap sessions, and things that hadn't been on their radar in the last year. They're back in, and they're back involved with us. We've been very fortunate there. The way we implement the whole MDM and data delivery has allowed people to be very, very comfortable in selling our solution. In the end, it's their reputation that’s on the line when they go in and they make a sale.

I don't think anybody has ever got fired for selling Blackberry, as we used to say. We are continuing down that same path. You're going to see when we announce our extended value around third-part device management, our value proposition will actually increase there from a total cost of ownership, and just single pane of glass to manage these multiple environments. It's very easy to deploy. It's very easy to support, and it's something that you can have confidence in that the solution will deliver.

Michael Finneran: Great. Thank you, Chris.

Ajay Malhan: Chris, may I also add that one of the differentiations we have today, as Blackberry, once we get BES 10 into a shop, they already have all the tools to support iOS and Android devices. And we have evolved that product quite a bit now where it's at par with the top-tier products out there, as well, for iOS and Android support, but Blackberry 10, nobody's really supporting Blackberry 10 except BES 10. So, that’s the other thing. If you want Blackberry 10 today, you will probably need BES 10, as well. When you have BES 10, you're already supporting iOS and Android devices. So that architecture is already in place. As we move forward, we're going to bring more functionality to iOS and Android devices. It just becomes a very unique proposition from RIM that nobody else can compete with. Blackberry Balance – it may seem like I said before... people may confuse that with a sandbox approach, but remember it's very deeply rooted into the OS itself. It's not something that we put on top at the application layer. It's not something that can be duplicated very easily by the competitors. Although it's a great idea, it's very hard to duplicate.

Michael Finneran: Great. Thank you, Ajay.

Dave Michels: Chris, I want to follow up on that a little bit with the UC reseller or VAR. How do they become Blackberry certified, or savvy?

Chris Wright: We'll use the word savvy, because we don't necessarily have a certification process for our reseller community. We've talked about that; but at the time we didn't feel it was the right time. But at any rate, we have a number of resources to be leveraged in our partner community. The easiest thing is our reseller portal, and that's at spn.blackberry.com (Solution Provider Network), and that's our standard reseller partner site. We house all of our information from a technical perspective or product information on that site; a lot of revenue opportunity programs through that specific site. We also have a general DL that comes in that Ajay's team manages, and that's at VartechSupport@blackberry.com. Short of that it's engagement through our distribution partners, too, because they're very well embedded in the fabric of our program. We sell through Ingram Micro and Tech Data proper, they've been on board with us for a long time, and both of them are building up vast mobility programs. We've been the cornerstone of their programs for a long time, and we have some very skilled resources in each of those distribution partners.

Dave Michels: Very good. Michael, I'm going to come back to you in a little bit. I'm going to move down to Marty, and jump into a little bit around application platforms.

Marty Parker: Thank you, Dave. Great to see the progress, RIM team. Nice job with what you've done in the announcement, and the mobile device management move is a very logical one for your customers, and makes a lot of sense. The obvious question next is, okay, and besides the very nice suite of applications you've brought to the table with the announcement, what do you think customers are going to do with the mobile device as an application platform? John Cash and I have worked together in Enterprise Connect sessions and others, and he knows that I think the mobile device is a pane of glass for enterprise apps, not just for the consumer apps.

In addition to email, calendar, contacts and instant messaging, which are the core pieces of UC, but to bring their business information out onto those devices to even eliminate telephone calls, and to go from an instant messaging session into an enterprise portal where the user can get the information they need on the client they're facing, or are about to meet, or can perform a transaction. We see a lot of applications for that. Is Blackberry 10 a platform for those kinds of applications, and is it a platform in such a way that development that customers might invest in applications for Blackberry 10 also fungible, transportable to iOS and Android environments? I'd love to hear your commentary on the future of apps for the Blackberry 10 platform.

Ajay Malhan: That was a great question. Lots of focus in RIM, right now, around enterprise app development. One of the things we are very proud to say today is that we perhaps today are the easiest platform to develop, for enterprise developers, for a couple of reasons. One, we are now supporting various SDKs, so we are supporting web-verse which is our own SDK for HTML5 development. We are doing native C++ development, and C, as well. So those skills are out there already with these developers. We have developed our own Cascades SDK, so now, you can, as an enterprise developer, not worry about creating that UI, or a beautiful UI, we do that for you already. Those tools are already in place.

We always had in place, and that was our key differentiator in the past, as well, the ability to take that app on the device and tunnel it behind your firewall without using a traditional VPN connection. BES does that today. Now the Blackberry Enterprise Service is able to tunnel any HTTPS traffic behind the firewall without need of a traditional VPM connection. And application developers are using that tunnel to have their applications go behind the firewall, and get access to those content servers. So really making that application intelligent, and really, utilizing that content behind the firewall which, if you were to implement any other way, would require an additional VPN layer on top of it to have those applications go behind the firewall.

Marty Parker: On that point, does that reside on the corporate side of the Blackberry, so that it's partitioned off, as you said before?

Ajay Malhan: Absolutely. So, that work channel is only available to the work side of the device. That's a very good question. One of the things that people have started realizing is that “hey, it's very cool that I can push out a VPN profile to a smart phone,” but they don't realize that when they do that, they don't give VPN access to just the intended apps, so it was really given so that I can get access securely, but what you did is you give access of VPN to all the 10,000 applications downloaded to that device, so that's where the risk of data leak is.

Marty Parker: That's a very important point. That's highly valuable. Now, the question is what about the Bring Your Own Device World. You're managing it through MDM, but does your app development platform have a translator, or do you provide any other services that make an app on Blackberry 10 easily portable over to the other environments?

Ajay Malhan: Do we do that? If there's an application that's developed for Blackberry 10 device, let's say, it all depends on how you're developing the application. Are you doing that HTML 5? If that is the case, then it's very cross platform to begin with. If you want to use our native SDK, that's going to be a limitation from platform-to-platform, but in most cases, our tools are so comparable, and developers tend to choose the most commonly used SDK to develop an application. So that it is really in a way that can really port those applications as fast as possible, so I’m not sure I answered your question there, but it will be easy to port applications to, and from the Blackberry platform, depending upon how they code their applications.

Marty Parker: So, really, the answer is that you have been careful that your development environment is an environment that allows people to use standards such as HTML 5, so that their work can be portable, but you're not providing that portability specifically, yourself?

Ajay Malhan: That's correct. At this time, the focus really is to give developers as many tools as possible, and take advantage of their skill set. We don't want them to go and learn a new language and develop for Blackberry. If you have an application in Flash, we support that. If you have an application designed for Android, we can port that application over. If there's an application that you want to develop in C++, Objective C, hey, we support that. It's a platform that supports your skill set already as a developer.

Dave Michels: If an enterprise wants to develop its own applications, do they have to go through some sort of Blackberry approval process, or can they just load them directly onto the devices?

Ajay Malhan: The enterprise applications are traditionally deployed through BES 10. There is really no approval process for that at all. The approval process is for an application that's submitted to Blackberry World which is our application storefront.

Marty Parker: One more question I'd like to ask in the application space. Is RIM sponsoring, whether by creating them yourselves, or by creating them through partners, or creating them through alliances, connectors to the major enterprise back-end platforms? So, do you have an SAP connector? Do you have a Microsoft Dynamics connector? Do you have other types of connectors for these applications to make those applications visible in the mobile environment with the least investment by the customer?

Ajay Malhan: We are working actively with most of the back-end vendors, mainly SAP. We did some announcements with them at the Blackberry Experience Forum in Toronto, as well, and really one of the things that we removed as a requirement for most environments is the ability to connect to that back-end system, through the BES gateway. That connector has really become sort of redundant for us. For example, SAP dashboards; they're mostly generally built in Flash, so easily portable to Playbook tablets and Blackberry 10 devices. We are able to get that secure access through the BES, so we're able to also run those applications securely. If there is an application that requires connectivity or VPN, or traditional VPN, we have the ability to push VPN profiles through these devices very easily, and we support the most common, the available traditional VPN gateways.

Connectors, in most cases, are not an issue, but we are also actively working, where there are requirements for connectors with most of the vendors out there. I'll come back to a couple of things, for our collaboration services we traditionally have supported OCS for Microsoft and Lync with Best Buy, and we are actually going to do the same for the Blackberry 10 platform, as well. We will see integration with those collaboration services very soon. We'll have integration with Lync, we'll have integration with SameTime, Workplace Messenger. Soon after, we'll also be looking at integration with Jabber, so that's been a big demand, as well.

Marty Parker: I saw the announcement included WebEx, already, so okay. Good. Thank you for that.

Dave Michels: Jim, a couple years ago you and I were at Lotusphere, and I was surprised how much Blackberry was on the agenda, or on the program, there. Things changed a little bit last year but I'm curious, this year you were there during the Blackberry launch, what were your observations? Was there any interest?

Jim Burton: There was tremendous interest. They had a pretty packed room. I felt very fortunate that I was at a location that was one of the venues for their worldwide launch. If I recall, there were about seven places around the world that were participating in the launch, and it was very well done. They did an incredible job of getting this thing organized, and launched, and building up the hype around it, so I was very pleased. I was also very impressed with the demo. They went through quite a variety of new features and capabilities they've added, and each one was just very well thought out, very well done, and like any demo, you went, yeah...let me see how that works, because with the demo, the person stood there with one hand, not two hands, one hand to do everything, navigating with flicks of the thumb, to do quite a variety of things. I was fortunate enough to be able to go down and try one, and it was true.

There are all these different features and capabilities you can do with the flick of a thumb, and being able to move back between your corporate environment, and your personal environment, which I think is an incredible capability, because all my investment banker friends have two phones, and they don't like it. Now they have a chance to go back to just one phone. It's just flipping a thumb, and never leaving so you don't have to close an app to go to another app. They're all there together.

I have a very specific question. One of the things we've discovered at the UC Summit every year is the expanding role of both the consultants and the resellers who are in attendance at the UC Summit, and how the enterprises are looking to them for more direction, more advice, helping them work on integrating everything. The question is, does Blackberry have any specific channel programs that are going to help this community better deliver services to their customers, which, of course, in your case would include a Blackberry solution?

Chris Wright: That's a great question, and yes. Most of the training and the available resources that we put into the channel are available on our partner portal which is spn.blackberry.com. We are talking about going back, and putting in (things like) certification programs around our reseller community. We wanted to stay away from that in the early days, just because we didn't want to convolute things with people having to invest in the ability to just sell and support Blackberry. We do a lot of in-market training. We have a substantial sales force that we extend into the U.S. and Canada to work with this channel, but like always, we can always get better at that.

What you'll now that there is absolute renewed interest in the platform, is us doing a lot more investment, not only in the demand generation around enterprise, but in that way we support our channel. There will be a lot more to come with that. We offer a free product. I'm very open to managing accounts that are of interest in specific regions. It's all about dealing with partners that are interested in building out a proper solution practice. I honestly think that most of the mobility solutions will be delivered from a traditional IP channel as we go forward.

Jim Burton: I agree completely, and look forward to seeing what some of those programs are. Please keep us up to date, because our objective is to keep the channel and the consulting community up to date on changes, and movements in the industry, so thanks for that.

Dave Michels: Michael, do you think the customer is the end user in the BYOD environment? Or do you think it might shift back to the enterprise or the CIO in a more, let's call it a “traditional” environment?

Michael Finneran: Well, I can tell you for sure in dealing with customers, it would make our lives a lot easier if we went back to the corporate liable model again, maybe the CIO. Unfortunately, that doesn’t seem to be the trend. In all the surveys I run for Information Week, Webtorials, we are always asking about the penetration of BYOD, and the numbers keep going up. Now closing in on 90 percent, which to me says the buyer is going to be the end user, not the CIO. We will have to determine how we are going to be able to support those devices in a secure and reliable fashion. But one of the questions I had for the Blackberry guys, and one of the challenges I have always found for Blackberry is, you guys always seem to be really good at the stuff that is invisible. You have great keyboards. You have great radios. We are not hearing about antenna gate. The stuff really is solidly build and works well. How do you intend to bring that into the product message and say there is value in this as well as all the cute stuff that Jim was alluding to like the new predictive typing capability that you have in BB10? How do you marry the old and also emphasize the new tricks you’ve got in the product now?

Chris Wright: That’s a great question, and you know we have had a lot of interest from not only our partner community but our end users. When they see, they’re thrilled with what they see in the technology, and they say, but how are you going to translate that to market demand? And that’s a great question, and we have a new CMO. I know that he absolutely has both barrels loaded and is attacking the market on a global basis. I think the way you will see most of our demand, our awareness creation, is around Blackberry people and who they are, and what they determine as important in their lives, and what they need in their lives to communicate actively. So, I think it’s more about how we are going to approach the market.

We all know who the leader is in creating demand, and we have a lot of things that we could highlight, but I think over time you will start to see us tear down those individual aspects of the value around our solution, but it will be all focused around a specific target market of active people who need to collaborate on a regular basis.

John Cash: And I will extend on that, Chris, and say, it is interesting. It was interesting to hear Jim’s comments about how things were at the IBM event. Unfortunately, I didn’t make that one, because I was at another event down in Miami. I saw end user’s reactions to the device, and I’m telling you that it really is just amazing. And I think that one of the things that is great about the Blackberry 10 device is yeah, and Michael you are right in pointing, we are great at the stuff that is invisible, but the Z10 is actually great at a lot of the stuff that’s visible as well. And it’s something that is really, really engaging end users, and I think that you are probably going to see a much different tone with these devices. If early results are any indication, based on what we’ve seen at some of the events that we’ve been at, and certainly what we are seeing as the devices go on sale, it is very encouraging.

Michael Finneran: Quick question: we’ve heard them both now, so is it Z10 of Zed10?

John Cash: Yeah, I think that probably depends on what your interpretation of the letter Z is.

Chris Wright: So, if you notice Thurston was very delicate around that and he used the word “Zed,” primarily because we were simulcasting that in seven locations all around the world, right? But I believe in-market, you’ll see the ads go to where they need to be; in the U.S. absolutely Z10, in the commonwealth countries, Zed10, because that’s the Queen’s English. But we will adapt that particular pronunciation to the markets that we are in.

Michael Finneran: Another challenge for a world-wide company.

Chris Wright: It’s a good one to have, though. I mean, when people are talking about it and they are debating that, that’s a good thing, right?

Dave Michels: Speaking of world-wide distribution or world-wide conquest, I don’t think I heard all the details about availability. I know you launched in U.K. first, and I think Canada was Tuesday. Are these being launched on 4G networks or 3G? Can you give us a little background on your launch plans?

Chris Wright: I can certainly talk to that, and we discussed this a little bit. Our regional launch plans for the most part will be dependent on the carrier acceptance of the devices on their network. So it will be carrier centric in-market. Almost I believe all 4G, LTE-type networks. In Canada, we launched Tuesday. Absolutely there were line-ups again like there were in the U.K., so that was very encouraging. But you will see systematic launch dates come out of RIM as the carriers come on board. There are about 250 with the product in-lab, and I know that that grows every day. We have 650+ carriers contracted globally.

John Cash: I had another comment on applications relative to one of the questions Marty, you had asked earlier, are enterprises going to adopt this platform and develop applications on it? I just thought I would share a perspective that we are getting from some of our major enterprise customers. When they see the hub and the way that it works, they are so impressed. The great thing about the development tools that we have is that within the API set, an enterprise can develop their own application to deliver content into that hub. So that’s very exciting for a lot of customers, because they see the potential there for that hub to say, drive an actual workflow process. So it is interesting, Marty. I know that in your engagements and talks with customers, you talk a lot about the communication enabled business processes. Those business processes now can communicate data directly into that hub, and that can sort of become the place that folks go to for that business process-driven data. So that is pretty exciting and a lot of our enterprise customers are really seeing the vision around that, and they are loving the capabilities that the APIs will bring to them to deliver that.

Marty Parker: Great, it will be exciting to watch that evolve and I would encourage your Chief Marketing Officer to create a buzz around what customers are doing with it, because I think it will go beyond the native interfaces you are developing. I think these application portals will become increasingly important, becoming the primary communication dashboard for most people, rather than the PBX interface.

John Cash: I would agree.

Dave Michels: Michael, we’ve seen two big launches fairly close to each other with Windows Phone 8 and the new Blackberry devices. Do you have a feeling on which one you are a little more confident in being successful?

Michael Finneran: It’s certainly going to be a challenge. For years, we’ve worked under the assumption that there were three seats at the table, and those three seats have been occupied by Blackberry, iOS and Android. Now the picture isn’t quite as clear any longer. Possibly it’s a duopoly. Maybe there are four seats at the table, but certainly the Apple has captured the imagination of the consumer … Android seems to be hedging their bets. Certainly programs like the Samsung safe program that I alluded to earlier seem to indicate that fairly clearly. But it is going to be a challenging market going forward. Of course, while things have not been rosy in Waterloo over the past few years, this is a business that changes continuously.

You are never going to have one mobile platform that will have 100 percent market share. It’s a matter of personal taste. And I think if both Windows Phone and Blackberry have the opportunity to show their wares in the marketplace, both will be able to grab adherence. Will there be as many as we have seen for the Android and iOS platforms? That remains to be seen, but I am not one that bets on the fact that there is going to be one dominant supplier in this. I think there is plenty of room for everyone in this market.

Dave Michels: I think the market is so young still and I’m just amazed at how many...we were just covering AT&T wireless getting into home automation and so people are now using their smart phones to control their lights and appliances and things like that. I think the reach or the opportunity for smart phones is still so early and still so young. Then if all these devices basically support the most popular aps, whether they be gmail or popular games or popular productivity applications, if they are all available on all the different devices, I don’t see how people can come to the conclusion that it’s too late, that third inventors can’t make it. These things have at best a two-year lifespan, certainly the contracts have a two-year lifespan or longer. The products have, at best, a two-year lifespan. So if they are constantly being replaced and the applications are becoming more consistent among all of them, and still obviously Blackberry and Microsoft have a ways to go to catch up to that huge library, but I don’t have a million applications installed on my phones.

Phil Edholm: This is Phil; I think that brings up a very interesting question. It appears with HTML5 that especially in the enterprise, but maybe even generally, we may be moving to what I will call for lack of a better word an app-less endpoint, where the applications is in fact an HTML5-based JavaScript download that comes down when you run the app, but is actually not resident. All that is really resident on the device is a URL pointer. If you look at the vast majority of applications that I would say that are non-gaming, absent communication, which means you have to have network connectivity, most of them don’t have a lot of value. If you look on your device, you find that’s true. So, I guess one of the questions I would ask is, do you think that becomes the future, in which case, I mean it is both an advantage and a disadvantage from a Blackberry perspective? It is an advantage, because you guys have great HTML5 support and as that becomes more predominant, and people say, well if I do HTML5 at a certain size, I can support any device that supports HTML5. That kind of overcomes some of that barrier especially on the enterprise side in the app store.

On the other side though, from an enterprise perspective it opens the door to saying, “I’m just going to do HTML5 and not allow caching, and that solves most of my security issues as long as I identify the user on the device.” What are your thoughts about that relative going forward versus the apps in the app store which is kind of where Apple started – it doesn’t seem like that’s really the future.

Ajay Malhan: I’ll kind of agree with the vision that HTML5 is the future for most lightweight apps, and that is something we considered very strongly and I am happy to report that Blackberry 10 has the best HTML5 browser. That is on mobile and tablet, both. So, that is true today. Now, what is really happening in the HTML5 space is that the agnostic nature of the applications is not really happening that much, because the HTML5 support on various platforms differs, right? So the developers, if you talk to some of them, they will say, “hey, I can create an application on your platform; it will be able to do all these things, but if I put this application to the other platform, I am losing functionality and then the user experience is not there anymore.” The users are also looking for that more powerful native experience when it goes to gaming or semi-gaming type applications. So, with that said, HTML5 is definitely the future. But for a long time we won’t see native app development for powerful applications and especially the gaming applications which are more are more resource intensive.  

Phil Edholm: Right, but those are more in the consumer space than the enterprise space, I guess is the thought process of can you, as an enterprise look to HTML5 as a way to deal across the plethora of potential devices your end users may use as BYOD? So that was really the thought process. Thanks.

Ajay Malhan: That is pretty much correct. We are actually talking to enterprise developers and encouraging them to do that. In fact, the initial challenge was that the enterprise developers didn’t really have that skill set. And the primary platforms that were developing HTML5 were not that far ahead at that time. If you look at the HTML5 scores about one year ago on some of these devices, they are pretty far back down. The Blackberry 10 device is scoring 478 right now. That has really come a long, long way in the last 12 months. So, we will see a lot more HTML5 support from the developers soon.

Phil Edholm: Okay thanks.

Chris Wright: So, if I could just add one more point about enterprise app distribution, I think the whole enterprise market from an application perspective has suffered from the availability and understanding of what is available in vertical market enterprise apps. I think it is kind of where the IT industry was in general about 30 years ago when there were only manufacturers. There wasn’t this sophisticated channel of distribution and certified partners. I think with the investment that the distribution partners and the channel guys like Ingram Micro and Tech Data and Synnex and those guys are making, I think you are going to see these vertical and more enterprise apps being aggregated at one point that can create more visibility into what is available from an application perspective in the enterprise. I think you will see that over the next five years really come to light. It will give a lot more opportunity for partners to sell into those vertical markets with applications geared to those markets. I think you are going to see some involvement there.

Dave Michels: John, if Michael is correct about the BYOD really being the standard, how do you interface with enterprises? What is Blackberry doing to call on the enterprise? What is your objective there in a BYOD world?

John Cash: Sure, and I guess I wouldn’t disagree with my friend Michael there, but maybe offer a little bit of a different perspective on it. BYOD, certainly is a factor in the market today, and is going to continue to be. But I think what you find is that there is a lot of different colors of it, if you will. Just because an organization may respond on a survey that they are enabling BYOD, that doesn’t mean that all of their customers within the enterprise are bring your own device. There are many – there are and still are and will remain many corporate liable lines within any given enterprise, but they also may have a segment of their population that is allowed to bring in their own device, and many different hybrids of that will exist. So that is really the division that I see, first of all.

So, what we are talking with our customers about though, of course, is our platform. So Blackberry Enterprise Service 10, along with our device platform, working with them, ensuring that they have the proper infrastructure and able to support it once the devices are fully launched and are in market. So, that’s really the activity that we have going on. We see a lot of promise within our accounts with that activity. And an awful lot of them are very interested in the BES 10 platform, both to support Blackberry 10 as well as enable support of other devices as well.

Michael Finneran: I would agree wholeheartedly with John with regard to the fact that rarely do we see BYOD being a one hundred percent solution. Fortunately we are starting to get some market data on that. We are doing a new survey on unified communications for Information Week and BYOD is one of the subjects we are touching on. We are specifically asking this time, what percentage of the devices of each brand variety are either corporate liable or individual liable. So hopefully we will start getting a clearer picture on that as we go forward.

Dave Michels: Michael, did you have any observations or comments about the new hardware they introduced?

Michael Finneran: Looks nice. I mean, I haven’t touched one yet. I have only seen the pictures. They didn’t invite me. But I assume it’s going to be the same solid stuff from all the hands-on reviews I have heard. Of course the only ones we have hands-on with as yet are the Z10 models. But the responsiveness and the software seems to be good. I mentioned before the predictive typing capability seems to be something that’s really unique. And as John mentioned, the Blackberry Balance has always been a strong offering in the level of integration. So, it is not a separate sandbox you have to go to get the corporate information. Blackberry is having a series of road events. I think the one here in New York is going to be on March 4. I intend to go to that. So, it will be my first chance to get my hands on one.

Dave Michels: Very good. Art Rosenberg?  

Art Rosenberg: Thanks, Dave. First of all, I think that everything you are doing for the enterprise sounds good, but the enterprise organization BYOD is not just for the enterprise; consumer BYOD is where you are going to be really selling a lot. They’re the buyers and they want it for their personal stuff and also in doing business. When they have to do business with a company, they will be using all the facilities and applications. So, one of the things that I thought was very appropriate, as Marty discussed, is the Hub capability. And I didn’t get enough of a picture of what it does, but as it was mentioned a little later, it seems to be capturing and taking care of all your contacts. And the question there is, there is now going to be a differentiation for a consumer, a customer; they are looking at information they’re entitled to. But then when they want to look into something of their own, their account, like with a bank or whatever, then they need to have the permission, the authority to get that kind of information.

So it’s not just whether you’re an employee, but even as a consumer, you will have the need for authorization and encryption and so on. So that was one question about how the Hub that fits into that. Especially as you start getting everything being delivered to your little device, and you are busy, you need to be able to, as a recipient, be able to control all the different notifications, because you don’t want to be bothered with everything that is happening. You want to know the things that are most important to you at that moment in time, and your situation. So, if you would please comment on what kind of flexibility is available through the hub, I would appreciate it.

John Cash: Sure, I will address that. Ajay, you might want to also expand on my comments. But how does this hub thing work? Basically this is where all of your communications and applications flow for anything that is hub-enabled. Out of the box, all of your core communication tools are hub-enabled. So that is email, your personal work email, text messages, BBM, instant messaging, social feeds, Facebook, Twitter, LinkedIn, all of those things report there in the hub. As well as if an application provider wants to extend their application into the hub and have it report there, then there’s a facility within our API to enable that. That application, by the way, can take on the persona of a personal application or a corporate application. And if it’s a corporate application, it will reside within that corporate perimeter and will inherit the Balance properties, if you will. So whenever that parameter is unlocked you will have access to that data and whenever that parameter is locked, you won’t have access to that data.

Art Rosenberg: It sounds to me that one of the big benefits of your channels, especially the carriers, (is that) they are the ones who are going to be able to sell all of this stuff to the market, the consumer market, which I see as a bigger opportunity than just employees.

John Cash: Yes, there is certainly a ton of opportunity for carriers and lots of different participants in the channel, no doubt about that.

Dave Michels: I love the fact that you redesigned or reinvented the mobile phone, because the Hub and the lack of a home screen, are very unique and innovative approaches. I am having trouble visualizing the Hub. It seems like it would be very overwhelming, very quickly if you had all your tweets and all your email and different accounts all in one stream. How are you adapting to this?

John Cash: It’s interesting you say that Dave, because I would on one hand tend to agree with you, but then on the other hand, it’s really nice to have everything in one place. There is this other feature that we haven’t really talked much about, and it’s called Peek. Peek is the thing that really allows me to manage the hub, and really have instantaneous “Peek” access to it, if you will. So, in other words when something, when an application reports into the hub, it gives me notification. I can, with one simple, one thumb gesture, swipe up and over, and see what is in the Hub without having to go into the Hub. If it is something that I need to deal with right then, I get an email from my boss. I probably want to go into the hub, and deal with that right now. But if it is you know a tweet from my social network that is probably not something that I need to deal with, and I can just go back to doing what I was doing. So, if you think about it, it provides on the mobile phone some of the same functionality that you are used to having on your desktop, let’s say the previews that come up in Outlook when you get a new email. You can be in your application, you get the pop from Outlook to see that you have a new email. And based on what it is, you either deal with it then or you let it fade into the background and deal with it later.

Michael Finneran: It is a neat interface; I did see that one demonstrated. It’s kind of like the Hub is hiding behind any application you are using. You can just shove what you are doing out of the way and have a look at it, nice design.

John Cash: Absolutely.

Ajay Malhan: Think about it like a card interface. You basically have cards sliding over each other, and Hub is the center of everything. One of the things that I would add to John is I personally feel it is overwhelming if I have to go to five different applications to do the things that I can do directly from the Hub now. I can start a workflow right into Facebook right from a single sign-on in Facebook, Linkedin, and Twitter. So, we do a single sign-on to all of these applications. We have integration with EverNote, with their member applications. That again, is a single sign-on for me. So that is great for me, because these streams are coming to me anyway. I don’t have to now go to six or 10 different places to action them. And the Peek works really well. You get the notification. You are working in an application right now. You do a swipe and then Peek into the Hub and see if this is an important message that you have to action. If not, then you can go back to what you were doing.

So that is the whole gesture. We have demoed it several times. It is something that is really, really effective in real life. That is really it then. I think the way our leaders say it is that we started off being successful by saving two seconds, three seconds, five seconds for people. That added up, right, and that is exactly what this does for us today.

Art Rosenberg: Let me ask you a question about the Hub, because I see it as great potential in various ways, but one of them is incoming phone calls that can be handled. Instead of ringing me and making me pick up and then finding out what it is, which is the old telephony approach, when a call is initiated, it goes through the Hub – “hey, this is a call that needs to be answered now – do you want to take it or not?” And let the control by the recipient come through something like the Hub?

John Cash: That is somewhat of a description of the way it works. I mean your Hub will collect, if you want it to, your phone calls can be recorded in there as well. And you will still get a ringing notification, if you will, on the phone, but then if you want to ignore the phone call, you simply press the ignore button. That gets then reported into your Hub as an event. Then you can go deal with it, how and when you want to deal with it.

Dave Michels: It’s been a very interesting conversation, and I think what has been very interesting to me is I have been reading the response to all the news is that this is really a new beginning, right? You are not done with the news. There is going to be a ton more information coming out. You have got a new platform in play. I am sure we will be hearing a lot more about the Playbook in the future and tablets and maps. We didn’t even touch on some of the stuff you announced like the camera upgrades. I think it’s just a very exciting place for you guys. We are very excited. I welcome the more competition and options in the marketplace. So thank you very much for joining us in this podcast, and we will be back next week with something new to talk about.