Will The FBI Ditch Blackberry?

Samsung Electronics Co Ltd is close to signing a deal to sell its popular line of Galaxy devices to the U.S. Federal Bureau of Investigation, sources familiar with the situation said late last  Friday.

The deal would be a boost for Samsung, which is increasingly seeking to cater to the needs of government agencies, a niche long dominated by Canadian smartphone maker BlackBerry Ltd.

The FBI, with more than 35,000 employees, at present uses mainly BlackBerry devices. It is unclear whether the agency plans to replace all BlackBerry equipment with Galaxy models or whether it will use hardware from both companies.

A spokeswoman for the FBI declined to comment on the matter, saying that the selection of its new smartphones is part of an active acquisition process and any current discussions are proprietary to the government.

The imminent deal was initially reported by the Wall Street Journal late on Thursday. The WSJ also said Samsung is close to signing a smaller order for its devices with the U.S. Navy, citing people familiar with the matter.

Representatives of BlackBerry and Samsung declined to comment. BlackBerry emphasized, however, that it regards its operating system as the best in the market in terms of security features.

“The security of mobile devices is more important now than it has ever been before,” BlackBerry’s chief legal officer, Steve Zipperstein, said in an interview. “It is fair to ask why in this context anyone would consider moving from the gold standard in security, which is the BlackBerry platform.”

In May, the U.S. Pentagon cleared Samsung’s Android mobile devices and a new line of BlackBerry devices powered by the BB10 operating system for use on Defense Department networks.

Samsung has been pushing hard to convince government agencies and corporate clients that its Galaxy devices, powered by Google Inc’s Android operating system, can meet their stringent security needs.

The South Korean company hopes that the Pentagon clearance and the imminent deal with the FBI will help boost sales to security-conscious clients including banks and law firms.

Some analysts remain skeptical about whether Android can meet all security requirements of such clients, and note that the FBI itself has highlighted some vulnerabilities of the platform.

“The Android operating system hasn’t been secured properly,” said Rob Enderle, principal analyst with Enderle Group, noting that Samsung has layered technology on top of the operating system in an attempt to make its Galaxy devices safer.

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RIM Says Subscriber Base Grew

Research in Motion offered investors a glimmer of hope on Tuesday, announcing a surprise jump in subscriber numbers that sent its shares up 5 percent, even as the embattled BlackBerry maker worked hard to drum up enthusiasm for its new BB10 devices.

Waterloo, Ontario-based RIM, once a pioneer in the smartphone arena, has rapidly lost market share in North America to Apple’s snazzier iPhone and Samsung’s Galaxy devices.

RIM is now attempting to reinvent itself through the launch of new line of totally revamped smartphones that will run on the new BlackBerry 10, or BB10, operating system. In an attempt to create a buzz around the new devices, RIM gave developers at a gathering Tuesday in San Jose, California, a sneak peek at the smartphone and its features.

At the event, the company also announced that its BlackBerry subscriber base has risen to 80 million from the 78 million it reported earlier this year, surprising many on Wall Street and sparking a jump in the company’s beleaguered share price.

In recent months, RIM has been completely focused on the launch its new line of revamped devices. In the meantime, its aging line-up of smartphones in the market have struggled to compete against the recently launched iPhone 5 and a slew of new Android devices. Most analysts had expected RIM to begin losing subscribers in the recently ended quarter, for the first time in its history.

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