BlackBerry Limited (BB)

[ZombieSecurityAgent]

Uhoh. Blackberries strong hold on the government could have a questionable future. The bad news for BBRY longs. I look for a nice sale off in the AM. Sorry longs.

http://www.nasdaq.com/article/blackberry-suffers-blow-as-white-house-begins-testing-samsung-and-lg-phones--update-20140320-01073

"BlackBerry Suffers Blow as White House Begins Testing Samsung and LG Phones

By Dow Jones Business News, March 20, 2014, 04:59:00 PM EDT

By Will Connors

The White House is testing smartphones from Samsung Electronics Corp. and LG Electronics Inc. for internal use, a person familiar with the matter said, threatening one of the last and most high-profile strongholds of BlackBerry Ltd.

The devices are being tested by the White House's internal technology team and the White House Communications Agency, a military unit in charge of President Barack Obama's communications, the person said. The tests are in the early stages, according to the person, and any implementation of Samsung or LG phones is still "months away." There is no indication that Mr. Obama himself is switching from a BlackBerry.

"We can confirm that the White House Communications Agency, consistent with the rest of the Department of Defense, is piloting and using a variety of mobile devices," a Defense Department spokesman said. He declined to comment on the devices in the pilot test or in use at the White House.

A Samsung spokesman declined to comment on whether its phones were being tested at the White House. "We have seen strong interest from the government sector and are working closely with various agencies to deploy pilot programs that allow these agencies to better understand and estimate the resources needed for a full deployment," he said.

An LG spokesman said the company wasn't aware of such testing.

President Obama uses a modified BlackBerry, long a point of pride for the Waterloo, Ontario, company. Apple Inc. for the last few years has been chipping away at BlackBerry's once-dominant position in the government sector, and Samsung has invested heavily to win more government customers.

Mr. Obama has said that he uses an Apple iPad for reading, but iPhones aren't part of the testing program, according to the person familiar with the matter.

The loss of key government users for BlackBerry comes on top of more widespread losses the company has suffered in the consumer smartphone market. BlackBerry once had roughly half of the North American smartphone market, but now makes up just 0.6% of that market, according to IDC.

To counter these challenges, BlackBerry over the last several months has undergone a broad executive overhaul and cost-cutting program.

The company's new chief executive, John Chen, has said that winning back government customers is a top priority. BlackBerry is opening a "security innovation center" in the Washington, D.C. area later this year as part of that effort.

Mr. Chen said in an interview this month with Bloomberg Television that he had met with officials from the White House to discuss "some of the stuff they like and some of the stuff they would like us to work on."

"For more than a decade, BlackBerry has been securing the U.S. government's mobile communications and only BlackBerry is designed to meet the high-security needs of U.S. and allied government agencies," a BlackBerry spokeswoman said.

Write to Will Connors at [e-mail]

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