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In a Bid to Get Its Devices into the Workplace, Samsung Courts Businesses

The leading smartphone manufacturer hopes to one-up Apple and nudge out struggling BlackBerry.

Sanjay Bhatia comes into his office each morning and plugs his tablet into a docking station. On his desk sits a headset, display, and keyboard. What’s conspicuously absent is a desk phone.

It might not seem revolutionary, but this scenario is pretty futuristic for most corporate IT departments. With the spread of powerful mobile devices, many businesses are starting to consider the same cost calculations that landline-cutting college grads did years ago, says Tim Wagner, Samsung Mobile’s Texas-based vice president for enterprise sales.

Last month, Samsung said it was working with Bhatia’s employer Genband, a large vendor selling unified communications software that lets companies carry voice calls, video, and IMs through internal Internet protocol networks on different devices. Genband will start by offering its software on Samsung tablets. If Samsung can make it simple to take company calls on its tablets, Wagner reasons, then businesses may be more likely to buy them—especially because tablets serve far more functions than hardware dedicated only to calling.

Helping to make desk phones obsolete is just another part of Samsung Mobile’s growing plan to see its mobile devices take over the workplace in the same way they have risen to prominence in the consumer market. It is trying to one-up Apple (which doesn’t often go out of its way to court businesses) while nudging out the struggling BlackBerry as the darling of IT departments everywhere.

The Korean company has a lot of ground to make up. The Android operating system, which it uses for most of its high-end smartphones, has a reputation for being less secure than other mobile platforms, partly because software can be distributed through unofficial channels but also because some malware has slipped into even the official Android Market.

To convince employers that Android devices are secure, Samsung has been working with mobile device management vendors to make its devices compliant with different IT department policies. It is using the branding SAFE, for Samsung for the Enterprise, on some devices to make it easy for people to bring their own device to work.

Samsung’s “Knox” system, to be launched soon on Galaxy S4 smartphones, is a walled-off mobile compartment for business users that allows them to separate their work and personal lives on one device. With Knox, Wagner says, Samsung is creating a shadow app store, putting its seal of approval on white-list Android apps that it verifies contain no malware.

Ted Schadler, an IT analyst at the research firm Forrester, is skeptical. “They’ve made a big amount of noise, and spent a lot of dollars promoting this acronym SAFE, but the functionality they’ve added is not all that impressive,” he says. He also says there is a limit to how far Samsung can alter Android without giving app developers headaches and raising their development costs.

Samsung could, however, gain a leg up, Schadler says, if it can successfully court IT buyers purchasing large numbers of mobile devices for workers by offering what BlackBerry has always done: very tailored service.

Samsung is already going down this path. Wagner says it helped the company Waste Management develop a rugged device holder to withstand the intense jostling that tablets get in trucks. With Boston Scientific, which had just bought a company that makes defibrillators that are implanted under the skin, it helped to create a small accessory that allows a doctor to monitor these implants on a phone or tablet.

To sell to the U.S. government, Samsung is working to get the highest security certifications, which requires Wagner to work with Samsung’s manufacturing division to make sure selected devices aren’t assembled in countries deemed a cybersecurity threat.  The more stringent authentication technologies it is developing to work with existing U.S. government systems such as card readers could soon “trickle down” to other business users, Wagner notes.

For its part, Genband is starting to make Samsung tablets available to its customers, and it will likely make smartphones available, too. At his own company, Bhatia, a senior marketing director, says desk phones will be gone for the 16,000 employees by the end of the year, though he can’t estimate the cost savings yet.

Bhatia expects office PCs will go by the wayside further down the line—especially as companies use software on remote cloud servers. New possibilities could open up, such as a work communication system that knows where an employee is and rings different devices accordingly.

Samsung won’t break out sales figures to businesses, but Wagner notes that the company did hit the 100 million mark for Samsung Galaxy S-series smartphones sold worldwide. With many people using their own devices at work, that may matter way more than anything else.

“In the world of phones, you have to win in the consumer market to win in the business market,” says Forrester’s Schadler.

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