For the makers of BlackBerry smartphones, Tuesday was supposed to be all about its new Torch 9800, the model meant to take on Apple's iPhone. But a security-related scuffle with officials in the United Arab Emirates is raining on the parade.
The federation's telecom regulator says it plans to halt BlackBerry data communications within the UAE, unless Canada-based Research in Motion (RIM) allows greater ability for authorities to monitor communications from the phones.
It's a battle that has high stakes for RIM.
"RIM is increasingly dependent on markets other than the United States and Canada ... for growth," says Kevin Restivo, a mobile-phone analyst at IDC Corp. in Toronto. "It would be in RIM's best interest to resolve this" in a way that keeps markets like the UAE open for its business.
"I would be surprised if RIM couldn't resolve this," Mr. Restivo adds, noting that the firm has successfully entered markets such as China.
If the company fails to reach a deal, it loses out on a lucrative market, with about half a million UAE customers who may switch products.
Still, the battle underscores the difficulties that high-tech firms can face in going global, and especially into emerging-market nations. Concessions to one nation may pave the way for RIM to face growing pressure from other national governments as well. (According to news reports, nations including India, Kuwait, and Bahrain have also voiced BlackBerry-related security concerns.)
And it could open the company to criticism that its policies hurt the cause of open communication and civil liberties.
The UAE says BlackBerry services are "the only data services operating in the UAE" in which messages are immediately exported out of the country, and out of potential surveillance by authorities, the Telecommunications Regulatory Authority said in a statement over the weekend.
"Certain BlackBerry services allow users to act without any legal accountability, causing judicial, social and national security concerns," the authority said.
BlackBerry services including encrypted e-mail, web-browsing, and instant messaging will be suspended in October unless the two sides reach a deal.
The dispute calls fresh attention to a policy arena of growing importance – the balance of power between technology users and governments. Tussles between Google and the government of China are another recent case in point.
Gadgets like smartphones empower people in many positive ways, but can also be used as tools of terrorism, prompting calls for governmental surveillance ability. Human-rights activists worry, meanwhile, that such surveillance could endanger legitimate social activism in some countries.
The US State Department has criticized the UAE move. "We're disappointed," a department spokeswoman told Toronto's Globe and Mail newspaper. "It's not about the Canadian company, it's about what we think is an important element of human rights ... and the free flow of information."
The Committee to Protect Journalists, in a Tuesday statement, described itself as alarmed.
“Handheld digital devices have become essential equipment for journalists, who rely on them to share information and do their reporting,” the group's executive director, Joel Simon, said. “The government’s plan to disable the devices will make the UAE a less hospitable place for the journalists and undermine efforts to make the kingdom a global media center.”
For its part, RIM is keeping mostly silent, but has said in a statement that it "is committed to continue delivering highly secure and innovative products that satisfy the needs of both customers and governments."
It is touting the new Torch smartphone as combining the best of a BlackBerry – including a slide-out keyboard – and "a full touch screen experience."