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Apple, BlackBerry, and the Department of Defense

Saturday - 5/4/2013, 4:00am  ET

The good news for BlackBerry is it remains the smartphone of choice for security-conscious government and corporate employers. The not-so-good news for BlackBerry shareholders is its stranglehold on the commercial market is loosening. Along with the growing bring-your-own-device (BYOD) to work trend, Samsung has recently been given the ultimate smartphone security stamp of approval, and Apple is close to earning the same.

The latest rumors
According to a recent New York Times report, the Department of Defense, or DoD, is close -- within a couple of weeks kind of close -- to giving the thumbs-up for its employees to use Apple iPhones in the Pentagon and other security-conscious government agencies. Initially, opening the doors to Apple and Samsung smartphones by the DoD shouldn't have a major impact on BlackBerry; it's entrenched, largely because of its strong, legacy OS security features.

It's the staunch security requirements of the U.S. government, especially intelligence and defense department agencies, where the real opportunity for Apple and Samsung exist. There are repercussions of gaining the blessing of the U.S. government that will ripple through the corporate world, as well, changing the market BlackBerry once dominated.

Apple will learn if its iOS 6 makes the DoD (along with other government departments) grade in "early May," according to the NY Times report. Apple is expected to have a relatively easy time passing muster because, unlike Samsung phones running the open source Google Android OS, iOS 6 is a proprietary system, meaning that it's easier to secure, similar to BlackBerry's legacy OS. As far as BlackBerry's new BB10 OS, not surprisingly, that has also gained DoD approval recently.

Why it matters
If there isn't a mass government employee exodus from BlackBerry devices to iPhones or Galaxy phones after gaining U.S. security approval, what's the big deal? BYOD is the big deal. Using personal smartphones to increase worker's productivity isn't new; big and small companies alike are exploring the concept. But here's where things really get interesting for Apple and BlackBerry -- according to a recent Gartner study, 50% of employers will require their employees to furnish their own smartphone devices. Not just ask ... but require them to. The possibilities for Apple (and Samsung) in the workplace suddenly grow exponentially.

Now, add in a stamp of approval from some of the most security-conscious folks in the world, and both Apple and Samsung immediately address the overriding concern of the corporate mobile device market -- keeping data secure. If iOS 6 gets the thumbs-up from the DoD, that'll certainly be good enough for the corporate world. BlackBerry is the ideal example of how powerful a government security endorsement can be; it's a large part of the reason BlackBerry is seen as the commercial smartphone.

Going forward
Don't expect an immediate pop for Apple's iPhone sales to government and corporate clients. Nor should you be concerned about the near-term impact of Apple and Samsung gaining government security clearance on BlackBerry Q10 and Z10 sales; it's not likely to change the game out of the gate. But, as the Gartner study suggests, the next two or three years could see a significant shift in the smartphone market, and that's great in the long term for Apple fans starving for some good news. For BlackBerry, the commercial marketplace it once called its own is going to become awfully crowded.

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This article was originally published as Apple, BlackBerry, and the Department of Defenseon Fool.com

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