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BlackBerry's demise pumps AirWatch growth

Phil Wainewright Profile picture for user pwainewright December 15, 2013
Mobile device management software vendor AirWatch is growing fast helping enterprises keep tabs on corporate data on smartphones and tablets

Even Canadians are now deserting BlackBerry, the Waterloo, Ontario-based maker of thumb-operated mobile phone handsets that once dominated the enterprise smartphone market. Being abandoned by its own countrymen surely signals the end, according to Kevin Kiley, director of enterprise sales for mobile device management vendor AirWatch:

"Our teams in Canada have been overwhelmed with enquiries — it's been our biggest growth area in the past quarter. Those last hold-outs are now throwing in the towel and moving off the technology ...

"It's like the ice cube in the pot of boiling water — there doesn't seem to be much hope for a recovery."

AirWatch, whose software helps enterprises manage their mobile device populations, has prospered as a result of BlackBerry's woes, Kiley told me on a visit last week to the company's Atlanta headquarters (where most employees work in the vast, open-plan,  former energy trading floor pictured above):

"Consumer devices that didn't have that BlackBerry management capability, we came in and filled that gap ...

"There wasn't a strong tool offering that allowed enterprises to deploy these devices at scale. To an extent it's BlackBerry's implosion has allowed us to step in."

BlackBerry's early popularity was in large part due to its security and management features that gave enterprises the control and oversight they needed over corporate email and messaging on the move. When smartphones such as Apple iPhone and a range of competitors based on Google's Android operating system emerged, there was no way to lock down the security in the same way without using third-party software.

That gap spawned the opportunity for a range of specialists to step in, among them AirWatch, MobileIron, Good Technology and Xenprise (now marketed as XenMobile after its acquisition last year by Citrix) as well as SAP's Afaria.

Rapid growth

Rated at the forefront of that leader pack in Gartner's Magic Quadrant for mobile device management software, AirWatch is growing even faster than the smartphone market. Its customer count of 10,000 is up from just 2,000 in Q1 of 2012 and twice that of its nearest rival, said Kiley. The employee headcount has scaled up rapidly to keep pace, from 150 three years ago to 1500 today, a third of whom work on product R&D. That helps it stay ahead of the competition, said Kiley — even the likes of Dell, which last week announced plans to enter the market.

"Even the big guys that tried to step into this market, the amount of headcount they've put into this is much smaller."

AirWatch, which delivers its software either as a service from the cloud or installed on-premise, aims to provide the security, provisioning and management of the full range of mobile devices enterprises may wish to deploy to employees. As Kiley explained:

"AirWatch allows them to promulgate policy at a top level down and we can get very prescriptive about how that applies to specific sets of employees."

That means keeping pace with the operating systems and features of smartphones and tablets from Apple, Microsoft, BlackBerry and all 39 licensees of Android, as well as others including Motorola devices following acquisition of the manufacturer's mobility services platform earlier this year.

The diversity and pace of change across the landscape is the main reason AirWatch devotes so many employees to R&D. As well as securing the device itself, there are the applications and content running on the device. That goes far beyond what BlackBerry originally offered, said Kiley, so that while AirWatch has expressed interest in buying BlackBerry's services division to acquire some of its intellectual property, the main benefit if a deal were done would be in reaching its remaining customer base.

Policy controls

The main focus of AirWatch's services is to protect corporate assets that are stored or accessed on the mobile device. In today's environment of BYOD smartphones, that requires some very detailed policy controls. For example, if the software detects a device has been compromised through jailbreaking or a malware attack, it may need to wipe corporate email and data without affecting personal items such as family photos.

"If needed, we can nuke your device. But more commonly we can go for a selective wipe. As soon as we've been able to detect that security has been compromised on this device we're able to pull back all those corporate data sets."

Corporate apps and content can be secured in an area that requires specific credentials to access. That allows enterprises to protect sensitive documents such slidedecks when an employee downloads them to the device from an online content store, said Kiley.

"They can do everything they want to with that content but they're not going to be able to take it out of that walled garden.

"Many of our CIOs and CSOs are very concerned about Dropbox and Box in particular. AirWatch gives them a secure answer here that gives them protection without relinquishing control."

The software can also take advantage of functions on the device such as geolocation to control how it is used. For example, it can delete sensitive files as the user leaves the corporate campus — or when they leave their home country. For employees that work in sensitive areas, in can switch off the device's camera when they arrive on site to prevent photos revealing confidential information. For hourly paid workers, it can switch off email and application access outside of working hours to ensure there's no liability to pay them for responding to emails in their free time.

Technology investment

A core element of AirWatch's blueprint for maintaining its market momentum is its investment in R&D. Accounting for a third of the company's total headcount, that's nearly double the tech industry average, said Kiley:

"While the market itself has grown up and this need has been acknowledged across most big companies, it's our added scale and size that really makes us different.

"AirWatch having all of these people allows us to be more agile and keep pace with what is probably the most quickly evolving area of technology today. There are so many different challenges and problems coming up.

"We have over 500 people just doing research and development — that makes our R&D team bigger than most of our competitors in their entirety ...

"We're really committed to keep reinvesting in the product."

The ten-year-old company's pockets were deepened in February this year when it raised a $200 million first round of venture funding at a valuation of $1 billion.

There's plenty of market opportunity to exploit, with organizations eager to mobile-enable applications so that more and more workers can access enterprise information systems away from their desks. The mistake many still make, says Kiley, is to use virtualization or remote desktop (RDP) technology as a shortcut, rather than truly mobile-enabling the applications.

"Because mobile is so new, there tends to be an over-correction where they attempt to lock it down to such an extent it degrades the user experience ...

"RDP or virtualization on a mobile client doesn't work — companies waste time and effort tying to make it happen ... That ends up delivering an experience that's so ill-suited to a mobile device.

"The experience ends up being so bad, you've now spent hundreds of thousands of dollars on virtualization and it's for nothing, because the employee isn't going to use it.

"That's the corner I see organizations having to turn sometimes. They have to come back to being mobile first."

Disclosure: SAP is a diginomica premier partner. Box is a diginomica partner.

Photo credit: courtesy of AirWatch.

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