Is RIM set to dominate the mobile device management market?

Yesterday I attended BlackBerry Jam Enterprise in Toronto, along with fellow CrackBerry writer Zach Gilbert. It was a good opportunity to hear RIM's perspective on what they're doing in the enterprise and how they are different.

We interviewed John Mutter, Enterprise Mobility Architect at RIM. But we also managed to chit-chat with several attendees including some of my former colleagues from the financial community, who were in attendance (Great to see all of you!)

Overall, I really like what RIM is doing in the enterprise. The strategy makes sense, and solves some big headaches for the enterprise CIO. But I can't help feeling concerned about communication and execution, as I'll explain.

Back in January, at CES, RIM talked about building an Enterprise app store. Yesterday I had my first chance to see a live demo running on Dev Alpha hardware. RIM, through the power of BES 10 and Mobile Fusion, will allow enterprises to host their own app store. This means corporations don't need to send their code to someone else's store to be published. It means nobody can dictate how the UI should look, or how the app should work. They get to call their own shots. They can enforce version control, user control and pretty much every other imaginable security policy right from a single dashboard controlled by an IT guy.

This is appealing, and while Mobile Fusion offers some management capabilities to non-BlackBerry hardware, the enterprise app store is likely to support only BlackBerry hardware for now. I think that's fine. It will probably be many years (if it even happens) before things get standardized enough to allow an app to be deployed and managed on a variety of end-user mobile device platforms (Android, iPhone, etc). In the mean time, CIOs who want to control their own app store may have to just pick a platform and stick with it. RIM is making it easier for customers to stick with them. The app store, the capabilities of BES 10 and Mobile Fusion, and the built-in capabilities of BlackBerry Balance all offer compelling advantages to customers.

RIM's primary goals with BlackBerry Jam Enterprise is to make sure their corporate customers understand where they are going with BlackBerry 10, and to make sure developers are equipped to start building enterprise apps. That's why they are handing out more Dev Alpha hardware and helping developers to install the dev tools on their laptops right there at the event. 

I think that's smart, and worth doing for sure. But it also tells me that the attendees at this event are not decision makers. They are not the people who will chose an MDM platform for a large organization. And it's these influencers that RIM really needs to be swaying.

In our interview with John Mutter, we also discussed the hugely important BYOD trend in today's market. RIM has an interesting (and sensible) position on this: The BYOD trend actually helps RIM by bringing more smartphones into the Enterprise. Employees are buying them and bringing them to work. In some cases, no MDM strategy is used, and these devices are connected (to email only) via ActiveSync. But in other cases, the corporation opts for an MDM strategy, so a higher penetration of smartphones, via BYOD, gives a company like RIM more opportunity to collect revenue on Mobile Fusion.

One thing that worries me is communication within RIM's enterprise division. I heard from multiple sources that this whole BlackBerry Jam Enterprise Edition tour felt like it was hastily thrown together. I say this because it seems plenty of people on the Enterprise team (who should know about it) didn't know it was even happening. By itself, that doesn't bother me too much. But it builds upon a trend of concerns I'm hearing from my own industry contacts. People with good track records for getting things right are telling me that RIM's overall enterprise strategy is not being well communicated internally or externally.

When communication is lacking, that's often (but not always) a sign of poor internal alignment on strategy. I don't want to cast harsh judgement on the company, but they need to step up their game. It all comes down to marketing, and there are no good excuses for weak performance.

Finally, although this is an overall RIM issue, not a specific enterprise issue, everyone is still wondering what RIM's business model is with BlackBerry 10. Currently, with the J2ME platform, RIM collects $1 billion per quarter in service revenues from carriers. This revenue has a very long history, dating back to the initial release of BlackBerry service over a decade ago. The switch to BlackBerry 10 provides an easy catalyst for carriers to renegotiate with RIM.

RIM often reminds stakeholders that it has over $2 billion of cash and no debt. My worry is simple: Imagine if RIM saw a 50% drop in service revenues. They'd suddenly bleed an extra $500 million per quarter. They'd run out of cash in just over one year. That could destroy the company.

I have no idea how big this risk really is, unfortunately. And RIM has done absolutely nothing to help investors understand their perspective on what's happening. Obviously some of this service revenue should be re-sourced directly from enterprises. I think Mobile Fusion should be run as a SaaS business. But will it?

RIM is showing us good progress. No question. But I'm not satisfied with their overall communication with enterprise customers, and I still feel very much in the dark about how they'll deal with pressure on service revenues over the next year.