Defense Department OKs Apple Devices, Blow to BlackBerry

Uncle Sam is finally an Apple (AAPL) fan. The Pentagontoday approved the use of iPads, iPhones, and other Apple products by its soldiers, sailors, and pilots.

The announcement, though expected, is less a win for Apple than a defeat for BlackBerry (BBRY). Almost 80 percent of the U.S. military’s 600,000 mobile devices are BlackBerry smartphones or tablets. That’s not actually so many: BlackBerry sold 28.1 million devices last year.

Sure, a few hundred thousand here, a few hundred thousand there, and eventually you’re talking real money. But the bigger damage to BlackBerry may be to its reputation for a unique level of network security. Historically, it has wooed corporate and government buyers and slowed defections with the promise of the most hack-proof network on the market. That fight has already been largely lost at the corporate level; when the the Department of Defense is cool with the competition, it’s hard for an IT guy to argue. Meanwhile, Samsung Electronics (005930) devices running Google’s (GOOG)Android operating system got the green light from the Defense Department early this month.

Specifically, the Apple approval lets government workers access military networks via iOS 6, though Apple has been making inroads at the Pentagon for a while. Some defense agencies already use Apple devices—about 41,000 devices in all—but to date, they’ve been required to crunch data through a third-party to comply with federal safety requirements. About a year ago, the Air Force awarded a $9.4 million contract to buy as many as 18,000 iPads, one of the military’s largest tablet purchases to date. Air Force pilots used the devices to replace bags full of manuals and navigation charts.

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BlackBerry CEO unveils new, low-priced Q5 before full house at Jam conference

ORLANDO, Fla. – BlackBerry maker Research In Motion Ltd. unveiled a lower-cost BlackBerry that is designed to entice consumers in emerging markets as the company stepped up efforts to regain market share lost to the iPhone and Android devices.

CEO Thorsten Heins said Tuesday that the Q5 device will be available worldwide this summer. It is RIM's third smartphone to run the new BlackBerry 10 system. The Q5 will have a physical keyboard, something that sets RIM's devices apart from Apple's iPhone and most Android phones.

'I know it's going to be a big hit. I think you're really gonna like it.'

- Blackberry CEO Thorston Heins

He said the "slim, sleek" device will be available in red, black, white and pink.

"I know it's going to be a big hit," Heins said. "I think you're really gonna like it."

Heins announced the phone to a packed ballroom to open RIM's annual three-day conference in Orlando, Fla.

RIM unveiled new, versatile BlackBerrys this year after delays allowed Apple and others to dominate.

Heins, who became RIM's CEO in January 2012, said the company has made a lot of progress in a short period of time, by moving in a diverse collection of people into leadership positions.

He restated BlackBerry's committed to "mobile first" and took a subtle jab at industry predictions that he might not make it to this year's conference as CEO in such a tough landscape.

"I'm happy to say they were wrong," Heins said. "We are not only still here. We are firing on all cylinders as a company."

The BlackBerry, pioneered in 1999, had been the dominant smartphone for on-the-go business people and consumers before the iPhone debuted in 2007 and showed that phones can handle much more than email and calls. RIM faced numerous delays modernizing its operating system.

RIM continues to do well in many places overseas.

RIM's stock fell 30 cents, or 1.9 percent, to $15.58 in morning trading Tuesday.

Heins said that RIM is "definitely in the race" and that he is excited about its outlook, with mobile being the key cog in their resurgence he said has brought it to a profitable quarter.

"The most successful year for BlackBerry is well under way," he said.

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