Boeing Sees Profits in Secure Mobile Phone Market

By Stew Magnuson
The Boeing Co. is developing a mobile phone based on the Android operating system that will compete with other manufacturers offering highly secure communication devices, company officials said.

Roger Krone, president of Boeing Network and Space Systems, told reporters that this was probably the first time the aerospace and defense industry giant will offer a communication device designed to use cellular networks.

Brian Palma, vice president of the company’s secure infrastructure group, said Boeing is near the end of the development cycle and getting ready to launch what he called “the Boeing phone” in late 2012.

Competitors offering similar secure, encrypted devices are charging $15,000 to $20,000 per device and are using proprietary software and hardware, Palma said.

“We are going to drive down towards a lower price point, but … not a mass market price point,” he said referring to iPhones, BlackBerries and other consumer market smartphones.

“We believe that there is significant interest in the defense side as well as the intelligence side and in the commercial world as well,” Palma said. The company also sees opportunities for the phone in the first responder market.

Boeing sees a larger business trend where employees once went to work to take advantage of information technology because it was far superior to what they had at home. Nowadays, it is the opposite. The consumer products have outstripped the office IT, and they wonder why their workplace has far less robust computers and phones.

Other vendors are lining up to take advantage of this growing demand. Companies exhibiting at the Milcom conference in Baltimore last year had numerous products on hand to make tablets such as iPads and smartphones more secure for those who use them for official business. Some companies made the devices tamper proof so employees couldn’t download unauthorized, possibly unsecure, applications. Others acknowledged that users want programs such as Angry Birds on their phones, and walled off the secure from the unsecure parts of the phone, basically putting two separate systems in one device.

Boeing’s secure infrastructure group sees business opportunities as workers’ IT becomes more mobile, and their expectations for having the latest applications are high. Along with that is the “persistent asymmetric security threat,” a codeword in the defense community for aggressive Chinese hackers who are determined to steal top secret information.   

This is why an Android-based system was chosen. The users of these high-end phones want the same ability to use popular applications while knowing that their business communications are secure, Palma said.

The phone will “give them what they are used to seeing [on consumer market smartphones] and give them the functionality from the security perspective,” Krone added.

“We are all living off this thing,” Krone said while holding up his smartphone. “And we’re not going back. In fact, the next one I have is going to be thinner, smaller and have more capability.”

Whether the Boeing phone will carry the company’s brand name has not been decided, Krone said. Palma also declined to reveal Boeing’s partners in the program.

Topics: Homeland Security, Emergency Communications

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