GO
Loading...

RIM in Mideast Smartphone Security Flap

Monday, 2 Aug 2010 | 1:16 PM ET

The United Arab Emirates and Saudi Arabia are moving to block RIMs BlackBerry email and instant messaging services, moves that are putting pressure on the stock today — and highlighting how secure BlackBerry messaging really is. (Get Real-Time Stock Quotes for Rimm Here)

One security expert I spoke with is puzzled by the government stance. Bruce Schneier of BT Counterpane noted that many consumer webmail services including Gmail and Yahoo Mail automatically encrypt messages, which should also raise the hackles of authorities. He said its not clear how RIMs services are so different.

A sign advertising the BlackBerry mobile phone is seen at a shopping mall in Dubai on August 01, 2010
AFP | Getty Images
A sign advertising the BlackBerry mobile phone is seen at a shopping mall in Dubai on August 01, 2010

David Hamod, president of the U.S./Arab Chamber of Commerce, said "everyone needs to cool down," and that this disagreement has been blown out of proportion.

These sorts of data security issues, he said, are not unique to the Arab world, and are coming up everywhere RIM does business.

UAE authorities have told him that they view this as a regulatory issue; RIM agreed to place a proxy server in the country as a condition of beginning to operate there in 2007. A local proxy server would store messages, giving the government a way to track communication.

There are some unique aspects to the way RIMs email works. Unlike other email services, BlackBerry email travels from the device to the local carrier and then onto RIMs private global network, making it more secure.

That structure has led to dustups between RIM and other governments. Russia, India and China have all pressured RIM to give them more access to BlackBerry data for security purposes, and they seem to have worked out compromises with the company. For example, in November 2007, Russian authorities announced that RIM would be able to operate in the country. Anonymously sourced news reports said RIM agreed to give government security services access to a proxy server.

It's a sensitive issue for RIM, which is known for its high security standards. The company released a statement this morning that implies that it expects to resolve the disagreements and continue operating within countries like the UAE and Saudi Arabia, without unduly compromising its security standards.

The statement reads:

RIM operates in over 175 countries today and provides a security architecture that is widely accepted by security conscious customers and governments around the world. RIM respects both the regulatory requirements of government and the security and privacy needs of corporations and consumers. RIM does not disclose confidential regulatory discussions that take place with any government however RIM assures its customers that it is committed to continue delivering highly secure and innovative products that satisfy the needs of both customers and governments.

Questions? Comments? TechCheck@cnbc.com

  Price   Change %Change
BB
---
YHOO
---
GOOGL
---