BlackBerry's Big Advantage over Apple iPhone

Posted by: Olga Kharif on November 4, 2009

BlackBerry devices enjoy at least one considerable advantage over rivals including the Apple iPhone: They use up much less wireless network capacity to complete the same tasks. That could prove to be an increasingly important advantage in the coming months.

A BlackBerry user can send 11 times the number of e-mails using up 50 Megabytes of network capacity than an iPhone user can, according to a recent report from Conaccord Adams analyst Peter Misek. A BlackBerry user can view 5,000 Web pages using the same amount of bandwidth as an iPhone would need to view 3,000 pages, according to the report. It’s all the result of BlackBerry maker Research In Motion’s global network of servers that efficiently pass the data to and from the device. Such a network would cost $50 billion to replicate, Misek figures.

Here’s why this is a big deal: As more wireless networks and bandwidth-thirsty smartphones come online, wireless carriers’ networks will be increasingly straining at the seams. Misek projects that network traffic is going to start exceeding capacity starting in 2010. To deal with this barrage of traffic, he expects carriers to start charging per Megabyte of data used. That means that iPhone users may have to pay 11 times more for the same number of e-mails as BlackBerry users. Those higher fees could make the iPhone much less appealing to consumers.

One solution: Apple and other smartphone makers may need to contract with RIM for the use of its back-end servers network, Misek says. Or, perhaps, its back-end infrastructure would prove valuable enough for some rival to buy RIM altogether.

Reader Comments

HD Boy

November 4, 2009 4:48 PM

This is just marketing FUD.

BlackBerry devices use less bandwidth because they have a crappy, outmoded Web browser that doesn't deliver a modern Web experience. Stung by Apple's surge in iPhone market share, RIMM already is working on a full, WebKit-powered browser that eventually will replace their current surfing tool and perhaps, compete with other modern Webkit-based browsers (like the iPhone's Safari or Google Chrome on Android). However, RIMM's outmoded operating system may become a factor once a modern Web-browser is layered on top. We'll have to wait and see just how scalable it proves to be...After all, it wasn't originally conceived or designed to support this type of Web use. This underscores what may be a larger issue — RIMM will have to overcome the "different screen size issues" which is a complicated problem for taking their phone products forward.

Also, cellular carriers aren't going to be successful if they try to charge by usage for data plans. Eventually (as the iPhone migrates to other carriers), customers will simply jump to another carrier. What carriers have to do instead, is to update their under-powered, under-specced cellular networks, or better yet, simply not oversell the capacity (as they do now). What should happen is that consumers should be banding together in a class-action lawsuits against any ISP that over-subscribes a network to the point where it cannot maintain the advertised bandwidth and connectivity. This is the real problem -- and the real solution needed.

This FUD is an attempt to delay customer churn, until Verizon and RIMM actually get some proven products that are more competitive with the iPhone. You can expect more PR bull like this.

Joe

November 5, 2009 10:49 AM

HD Boy,

you undermine your own arguments - how are technical specs marketing FUD?: "better yet, simply not oversell the capacity "
you place the blame for network failures on the carriers - not on the devices - but carriers will not sell devices that crash their networks.
do some investigating into what AT&T's customer satistfaction has become under the iPhone.

"Verizon and RIMM actually get some proven products that are more competitive with the iPhone."

Verizon and RIM are both doing much better than Apple and AT&T.

D

November 6, 2009 1:06 AM

Hate to tell you but it's so true - BB uses less because it's SO shitty... websites are practically unreadable, can't even see images in email... yeah yeah "Get Images" yeah DOESNT WORK... i'd rather pay more so I can actually SEE what i'm doing on an iPhone. I'll be switching this Christmas FOR SURE.

E Moxley

November 15, 2009 1:06 PM

Currently, iPhone uses AT&T exclusively. Everyone knows that Verizon has America's largest 3G Network. Bottom line, iPhone should sign up with Verizon when their contract ends with AT&T. That will keep the costs low and improve their emails and browsers.

SV

November 16, 2009 3:47 AM

I totally agree with the view that the lesser usage of network data is not an advantage, rather it used to be yesterday... Data is getting cheaper and we need stronger networks and not devices which run with lesser data... RIM has already bent it's rules and started providing BIS plans with 1GB and 3.5GB data... I asked the local Sales & Marketing guy here as to why that had become the case when they don't need more than 30MB at the most to do one whole quarters emails (7MB * 3 months = 21MB)... He said, thanks to the iPhone we're having to sell our plans with practically useless data packages... So much so that they're priced more than 30-50% lesser than before here in Singapore... They HAD an edge over the lowly WinMo devices and not over the iPhones/Androids or the Palm Pres of today... New browser would do them a hell lotova good... They're working on that i presume... All the best to RIM...

Jay

November 24, 2009 11:35 PM

There are some estimates that AT&T will spend between $5-$10 billion in 2010 to upgrade network capacity. Additionally AAPL's average ASP is estimated at around $600 per device, before carrier rebates. These numbers are not sustainable for carriers in emerging markets. The average revenue per user in India per month is less than $10. It's in developing countries where, if RIM can gain a foothold, with network efficiency benefits and low device ASP options they should perform well.

br14

November 25, 2009 12:26 PM

"BlackBerry devices use less bandwidth because they have a crappy, outmoded Web browser that doesn't deliver a modern Web experience"

BlackBerrys use less bandwidth because they have infrastructure in the carriers that compresses data sent over the wire and is decompressed on the device.

This means the carrier can bill the same as for the iPhone but use 10% of the bandwidth.

RIM's infrastructure and device OS is specifically designed for mobile devices and not a hacked Linux like iPhone and Android.

This makes their OS light years more advanced than the others in the field and significantly more secure. Do you really want to do online banking on an iPhone, or on an BB OS designed by cryptographers?

The RIM UI and browser sucks. I'll give you that. But they still have a little time to fix that.

Get real on their technology. It's a phenomenal advantage because the carriers make more money per device than they do with just about anyone else. And even when plans are flat rate, it means carriers can use their older technology longer, and use the newer technology more efficiently.

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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