Australian business travellers to be disconnected when Saudi Arabia cuts BlackBerry services on Friday

It’s been a mixed week for Research In Motion. The company has now been informed BlackBerry services will no longer be allowed in Saudi Arabia from this Friday, just days after it attempted to strike a blow to Apple’s smartphone dominance by releasing the BlackBerry Torch.

The decision to block all BlackBerry services because of security concerns comes as the United Arab Emirates is currently debating a similar move.

But the move could have wider implications for Australian businesses. Australian Institute of Export executive director Ian Murray says there are plenty of businesses travelling and operating through the Middle East which will be affected by the move.

“There are definitely Australians operating in the Middle East, it’s a big market for us, and I guess to the extent this is a barrier to business it’s going to have a negative effect. These days people are communicating effectively via all forms of mobile.”

“The Middle East is a big market for Australia, particularly in the services sector. Any type of restriction on doing business is an annoyance, particularly as Australia plays quite strongly in the area.”

The Saudi Arabian telecommunications regulator made the decision overnight, with state news agency SPA reporting its move. It reports the regulator asked “Saudi Telecom Co, Mobily and Zain Saudi Arabia to immediately stop the BlackBerry service in the country starting Friday”.

The suspension was made because the BlackBerry service “in its present state does not meet regulatory requirements”.

Saudi Arabia has about 700,000 BlackBerry users, many of whom are younger residents who use the device to communicate with the opposite sex in private – a practice looked down upon in the country’s extremely religious and conservative society.

Some analysts say the decision was prompted by this activity. RIM uses secure email servers, and regulators may have trouble accessing these to pry on users’ email and communications.

The decision may even have been prompted by a statement released from RIM yesterday, which stated it would not comply to the “government of one country” with regards to changing its email practice.

Saudi Arabia says its telecommunications regulator informed the nations’ three mobile telecommunications providers more than a year ago of the need to meet its “egulatory requirements”.

However, telco analyst Ovum says RIM needs to stay firm, even though the issue is a challenging one. While the Middle-East is a growing market with plenty of opportunities for smartphone manufacturers, RIM puts itself at risk of being seen as “guilty by association” if it bends to the will of religiously conservative countries.

“If RIM starts down the slippery slope of offering “customised” security environments to individual governments, how long will it be before the company is “piggy in the middle” between two countries that have a serious interest in compromising each other’s security for commercial, or even military, reasons?”