Samsung muscling in on BlackBerry's government sales

Samsung Electronics Co Ltd may sign a deal US Federal Bureau of Investigation to sell its popular line of Galaxy devices.

The deal would come as a boost for Samsung, which was increasingly looking to gain a piece of the government business pie, a niche long dominated by Canadian smartphone maker BlackBerry Ltd, the report said.

The FBI, with over 35,000 employees, at present uses mainly BlackBerry devices and it was not clear whether the agency planned to replace all BlackBerry equipment with Galaxy models or whether it would use hardware from both companies.

A spokeswoman for the FBI declining to comment on the matter, said that the selection of its new smartphones formed part of an active acquisition process and any current discussions were proprietary to the government, according to Reuters.

The upcoming deal was first reported by The Wall Street Journal on Thursday, which also said Samsung was close to signing a smaller order for its devices with the US Navy, citing people familiar with the matter.

Representatives of BlackBerry and Samsung declined to comment. However, the Canadian company pointed out, that it regarded its operating system as the best in the market in terms of security features, the report said.

BlackBerry has for years been the dominant player and smartphone of choice at workplaces where professionals demanded ironclad security features and super-fast email.

However, its top position in the niche, the cornerstone of its business and perhaps its last bastion, was under threat, which had become a cause for worry among investors and analysts. Experts feel that BlackBerry Ltd might be running out of time.

In recent weeks a slew of businesses and government agencies had moved away from BlackBerry phones, a trend that was worrying the company no end, as it refocused its attention on business users after watching consumers depart in droves.

BlackBerry's revival efforts have run into heavy weather due to several changes at the workplace. The company has taken a huge hit due to the "bring your own device to work" policies, known as BYOD, and enterprise clients' internal decisions shuns BlackBerrys for iPhones, Android devices and even Windows Phones.

According to analysts, BlackBerry's enterprise business was especially important as it was more profitable than the company's consumer segment.

Rivals that have already gained an upper hand over BlackBerry on the consumer side are moving in and doubling their efforts to woo business users - and it appeared to be working.