WRAPUP 3-BlackBerry assures India on access to services-source

(Updates with BlackBerry assurance over access)

* BlackBerry faces email, messaging ban over security
worries

* Assures India access to its messenger, email services

* Google, Skype, operators under scrutiny

By Bappa Majumdar

NEW DELHI, Aug 13 (BestGrowthStock) – BlackBerry’s Canadian maker
will provide India with technical solutions next week to help
read its encrypted data that New Delhi sees as a security
threat, a senior government source said on Friday.

The assurance raised hopes that India might withdraw its
threat to ban messenger and encrypted email.

India has given Research In Motion, the maker of the
popular BlackBerry smartphone, until Aug. 31 to comply with a
request to gain access to encrypted corporate email and
messaging services or those services will be shut.

RIM (RIM.TO: ) (RIMM.O: ) is under pressure from governments
around the world to give access to its codes. Other firms have
also faced scrutiny since officials intensified their fight
against Islamic militants misusing mobile devices.

“They have assured that they will come with some technical
solution for messenger and enterprise mail next week,” the
government source said. “Our technical team will evaluate if it
works.”

The source, who spoke on condition of anonymity, also said
the government had concerns over Internet telephony and would
take it up with companies such as Skype.

Earlier in the day, BlackBerry officials met Indian
authorities, now pledged to go after firms, including Google,
to keep the world’s fastest growing mobile phone market safe
from militants and cyber spying.

After the meeting, Robert Crow, a vice president at
BlackBerry, expressed optimism that the company would resolve
India’s worries. “It is a step in a long journey,” he said.

At 1405 GMT RIM shares were down 1.5 percent at C$55.59,
despite the assurances. [ID:nBMA008250]

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For a TAKE-A-LOOK on BlackBerry, click [nSGE67B0KN]

For a Q+A on BlackBerry’s security, click [ID:nN12132220]

Graphic on the BlackBerry encryption system:

http://graphics.thomsonreuters.com/RNGS/2010/AUG/BB3.jpg

For an analysis on political risk in India,
http://r.reuters.com/nyt92n

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Pakistani-based militants used mobile and satellite phones
in the attacks on Mumbai in 2008, which killed 166 people. The
militants were suspected of using Internet telephony, which is
widely available.

The authorities have for more than a year been looking at
Google’s (GOOG.O: ) messaging, Skype and other providers of
communication in India.

“Wherever there is a concern on grounds of national
security the government will want access and every country has
a right to lawful interference,” a senior interior security
official, who declined to be identified, told Reuters.

STRICT IMPORT RULES

India has already forced mobile phone operators, including
leading Bharti Airtel (BRTI.BO: ), to follow strict import rules
when buying telecoms network equipment.

Chinese manufacturers Huawei Technologies [HWT.UL] and ZTE
Corp (0763.HK: ) have been temporarily prevented from shipping
network equipment for fears of embedded spyware.

“We have concerns regarding these (Google and Skype)
services on grounds of national security and all those services
which cannot be put to lawful interference,” the same source
said.

India’s demands follow a deal with Saudi Arabia, where a
source said RIM agreed to give authorities codes for BlackBerry
Messenger users. The United Arab Emirates, Lebanon and Algeria
also seek access.

How much brinkmanship is involved remains to be seen. Not
one country recently threatening to ban BlackBerry corporate
email or messaging services has carried through with the
threat.

“We don’t expect a ban actually. There will be some
solution before the deadline,” said a senior official with a
mobile phone operator in India, who did not want to be
identified.

Officials say RIM had for a time proposed tracking emails
without sharing encryption details, but that was not enough.

India, like other countries, has been criticised for
seeking blanket restrictions while mobile phone operators say
they have to offer consumers privacy and secure communications.

India is also keen to retain its position as one of the
world’s fastest growing IT nations.

Competitors have eaten into RIM’s once-dominant share of
the North American smartphone market, pushing the company to
look to places like India and Saudi Arabia for growth.

A shutdown would hit one million users in India out of the
smartphone’s 41 million users, allowing them to use the devices
only for calls and Internet browing.

RIM, unlike rivals Nokia (NOK1V.HE: ) and Apple (AAPL.O: ),
operates its own network through secure servers located in
Canada and other countries, such as Britain.
(Additional reporting by Devidutta Tripathy and writing by
Paul de Bendern; Editing by Alistair Scrutton and Ron Popeski)

WRAPUP 3-BlackBerry assures India on access to services-source