* UAE to halt Blackberry services in October
* Cites security concerns regarding data exported offshore
* Services to be halted until ‘acceptable solution’ found
* India, Bahrain have also warned over abuse of services
By Tamara Walid
DUBAI, Aug 1 (Reuters) – Blackberry maker Research In Motion (RIM) (RIM.TO) (RIMM.O) was hit with its first major ban on Sunday after the United Arab Emirates, citing security risks, said Blackberry services would be barred in October.
The move, which will affect half a million users as well as visitors to the Gulf state, follows a warning from Bahrain in April against using Blackberry Messenger software to distribute local news and security concerns raised by India last week. [ID:nSGE66S09D]
The UAE, home to Gulf financial hub Dubai, said it would halt Blackberry services on October 11 until an “acceptable solution” is developed and applied.
“It’s a final decision but we are continuing discussions with them,” Mohammed Al Ghanem, director general of the UAE’s Telecommunications Regulatory Authority (TRA) told Reuters.
“Censorship has got nothing to do with this. What we are talking about is suspension due to the lack of compliance with UAE telecommunications regulations.”
The UAE objects to Blackberry data being exported offshore and managed by a “foreign, commercial operation”.
“Today’s decision is based on the fact that, in their current form, certain Blackberry services allow users to act without any legal accountability, causing judicial, social and national security concerns for the UAE,” the TRA said.
TRA’s Ghanem said the suspension would also apply to Blackberry users with foreign telephone numbers, closing one potential loophole.
RIM officials in Canada were not immediately available for comment. RIM shares rose last week on speculation that it might unveil a new touchscreen BlackBerry 9800 this week to better compete with the iPhone and other models. [ID:nN28178428]
The suspension of Blackberry Messenger, email and web browsing services comes after attempts dating back to 2007 to bring the service into line with regulations, the UAE’s TRA said.
One of the two local service providers, state-controlled Emirates Telecommunications (Etisalat) ETEL.AD, introduced a software upgrade last year which RIM said was an unauthorised “telecommunications surveillance application.” [ID:nLM657641]
The UAE expressed concern last week that the device is open to misuse that poses security risks — a move some took as dissatisfaction with the inability to monitor the popular Blackberry Messenger service. [ID:nLDE66O07I]
Etisalat, with the lion’s share of Blackberry users in the UAE, and fellow service provider du telecom DU.DU said they will offer alternative services to clients within days, but did not elaborate.
Shares in Etisalat closed down 0.5 percent in Abu Dhabi .ADI while du closed unchanged on Dubai’s main index .DFMGI.
Most owners of Blackberry handheld phones in the UAE are high net worth business executives as well as expatriates, who comprise the majority of the population.
“I think there will be such an uproar, it probably won’t happen and a solution will be found,” said Irfan Ellam, Al Mal Capital telecoms analyst, referring to the mooted Blackberry services ban.
“Blackberry is seen as essential by many companies, so if you want to attract business to your country it doesn’t make much sense to ban these Blackberry services,” said Ellam.
He said RIM had been asked to set up a proxy server in India to allow the government there to monitor traffic from a security perspective and the same approach might resolve the issue in the UAE and elsewhere.
“The government regards the services offered by BlackBerry, especially its instant messaging, as an obstacle to its goal of reinforcing censorship, filtering and surveillance,” Reporters Without Borders said in a statement last week.
India’s Internal Security Chief U.K. Bansal told reporters last week that maker RIM had pledged to soon resolve Indian concerns that militants may use BlackBerry data services.
A spokesman for Bahrain’s Telecommunications Regulatory Authority (TRA) said on Sunday there was no plan to suspend Blackberry services in the Gulf island kingdom.