RIM has always touted their carrier relationships as one of their most valuable assets. They also like to call themselves the most profitable smartphone for carriers. Larry Dignan at Seeking Alpha had a chance to get some more information from Balsillie as to why RIM thinks that is so.
It turns out that it is all about network usage. Balsillie essentially pointed out that BlackBerry devices use less traffic since RIM optimizes all the data that goes to and from your BlackBerry by funneling it through their infrastructure first. As the AdMob report showed last month RIM uses a margin of what other devices like the iPhone uses. That means that since carriers have limited bandwidth available BlackBerrys make better use of it and are thus more profitable. In short they use less network capacity per BlackBerry making them more profitable.
Even though new 3G technologies offer the possibility of faster connections in reality carriers do not have a unlimited amount of backhaul capacity. That means that even though 3G might be capable of speeds topping 20mbps the towers themselves may not have that fast of a connection.
If you are interested in Balsillie’s exact words I recommend checking out the full article at Seeking Alpha. Kind of interesting to note that it is rumored that AT&T is increasing their network capacity tenfold to prepare for the next iPhone this summer.
DavidB ( View Profile) - Posts: