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Samsung and Apple Inc. (AAPL) Want Research In Motion Ltd (BBRY)’s Government Fortress Next

Apple Inc. (AAPL)Within the high-end consumer smartphone market, it’s unambiguously a two-horse race between Apple Inc. (NASDAQ:AAPL) and Samsung. On the enterprise and government side of things, the top two smartphone vendors still have their work cut out for them. Research In Motion Ltd (NASDAQ:BBRY) still has a grip on those subsectors, but the Canadian smartphone maker is slipping.

The Wall Street Journal has heard rumblings that Samsung is about to score two orders from U.S. government agencies. The FBI and Navy might be able to order up some Galaxies in what would be the South Korean giant’s first contracts after getting its devices approved by the Department of Defense a few months ago.

Samsung has put a lot of weight behind developing Knox, its security suite that sets it apart from its Google Inc (NASDAQ:GOOG) Android brethren. Knox sits on top of Google Inc (NASDAQ:GOOG)’s platform as a separate layer of security features to appeal to enterprise and government users.

Samsung Knox. Source: Samsung.

The DoD approved Knox in May at the same time that BlackBerry 10 earned the seal of approval. It wouldn’t be long for Apple Inc. (NASDAQ:AAPL) to join its competitors, as just a couple of weeks later the DoD would similarly sign off on iOS 6, validating the iPhone for use within government agencies. At the time, the DoD had more than 600,000 commercial devices in use, including:

Type of Device Number of Devices
BlackBerry 470,000
Apple 41,000
Android 8,700

Commercial mobile devices in operational and pilot use as of May 2013. Source: Department of Defense.

That shows how much of a lead Research In Motion Ltd (NASDAQ:BBRY) currently has, but remember that the majority of those devices are running on the older BlackBerry 7 platform that the company is transitioning away from.

The figures can also be seen as an opportunity for Apple Inc. (NASDAQ:AAPL) and Android to chip away at Research In Motion Ltd (NASDAQ:BBRY)’s lead. Samsung’s Knox gives it a leg up in scoring government contracts compared to other Android OEMs that may not have the resources to develop unique security offerings.

While the possible FBI order is reportedly larger than the Navy one, neither one is remarkable compared to the volumes that Samsung enjoys in the consumer market. Rather, the company sees much more opportunity in the enterprise than the government, but scoring some government contracts would give Samsung validation that could help it sell better in the enterprise. Samsung has begun marketing heavily to enterprise users, such as its “Unicorn Apocalypse” series of ads that began airing earlier this year.

Apple Inc. (NASDAQ:AAPL) and Samsung have already eaten Research In Motion Ltd (NASDAQ:BBRY)’s consumer market share, and the two heavyweights are looking to take down Research In Motion Ltd (NASDAQ:BBRY)’s government fortress next.

The article Samsung and Apple Want BlackBerry’s Government Fortress Next originally appeared on and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends and owns shares of Apple and Google.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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