Samsung close to mobile-device deal with FBI - sources

Reuters : Washington, Sat Jul 20 2013, 14:57 hrs

Samsung Electronics Co Ltd is close to signing a deal to sell its popular line of Galaxy devices to the U.S. Federal Bureau of Investigation, sources familiar with the situation said on Friday. The deal would be a boost for Samsung, which is increasingly seeking to cater to the needs of government agencies, a niche long dominated by Canadian smartphone maker BlackBerry Ltd

The FBI, with more than 35,000 employees, at present uses mainly BlackBerry devices. It is unclear whether the agency plans to replace all BlackBerry equipment with Galaxy models or whether it will use hardware from both companies. A spokeswoman for the FBI declined to comment on the matter, saying that the selection of its new smartphones is part of an active acquisition process and any current discussions are proprietary to the government.

The imminent deal was initially reported by the Wall Street Journal late on Thursday. The WSJ also said Samsung is close to signing a smaller order for its devices with the U.S. Navy, citing people familiar with the matter. Representatives of BlackBerry and Samsung declined to comment. BlackBerry emphasized, however, that it regards its operating system as the best in the market in terms of security features. "The security of mobile devices is more important now than it has ever been before," BlackBerry's chief legal officer, Steve Zipperstein, said in an interview. "It is fair to ask why in this context anyone would consider moving from the gold standard in security, which is the BlackBerry platform."

In May, the U.S. Pentagon cleared Samsung's Android mobile devices and a new line of BlackBerry devices powered by the BB10 operating system for use on Defense Department networks.

Samsung has been pushing hard to convince government agencies and corporate clients that its Galaxy devices, powered by Google Inc's Android operating system, can meet their stringent security needs. The South Korean company hopes that the Pentagon clearance and the imminent deal with the FBI will help boost sales to security-conscious clients including banks and law firms.

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