Why Is This Analyst More Worried About Android Than BlackBerry?
The future of Google Inc's (NASDAQ: GOOG) ubiquitous operating system may not be set in stone.
Between the rise of iOS devices, the decline of SAMSUNG ELECT LTD(F) (OTC: SSNLF) and the potential for Windows Phone to accelerate, Android is no longer the easy leader in mobile development.
"I am more worried about Android than BlackBerry," Global Equities Research analyst Trip Chowdhry told Benzinga. "Even though they have the market numbers, Android is in trouble right now."
Chowdhry's comments came after BlackBerry Ltd (NASDAQ: BBRY) announced Leap, its latest smartphone. The device is being targeted at a niche group of consumers: entrepreneurs.
"[Android] is just like a belly button -- everybody has one, whether you are rich, poor, whatever," Chowdhry joked. "A certain segment of society…has an aspiration to be differentiated. Android is not catering to that anymore."
Android's 'Consumer Fatigue'
Chowdhry believes that BlackBerry stands to benefit from the "consumer fatigue" that plagues Android.
"[President] Obama uses BlackBerry," said Chowdhry. "Why? When you think about that high level of security that a President needs…you can't just be an inch deep and a mile long. To get that kind of business you have to be [very secure]. It's a very high niche market, but it is the right strategy for BlackBerry to follow."
Chowdhry said that Android cannot "harden" its operating system to the level that BlackBerry has achieved -- that is, increase its security to become a dominant player within federal governments all over the world.
"To accomplish that level of security, who would you trust?" Chowdhry questioned. "BlackBerry or Google? Google has been blatantly using your information. The reason why Google is failing today is not because of technology, it's because of behavior."
Shares of Google are up more than 8 percent year-to-date, but Chowdhry said the fundamentals are weaker than they were 12 months ago. He said they don't support the stock and might show up in the company's results.
"When it comes to deep security, Android is a non-player," Chowdhry added. "They will not get a single customer because they do not have the credibility of securing privacy. The path at which BlackBerry is going is [the right] path because they are not becoming a belly button player. They have deep expertise in securing the wireless mobile services that nobody else can do."
Not even Apple Inc. (NASDAQ: AAPL) can compete in this regard.
"Apple iPhone cannot be secure to the level that federal agencies require, like the President," Chowdhry concluded.
Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.
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