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China gives BlackBerry maker a raspberry

The BlackBerry e-mail device is coming to China in the next few months. By then, thousands of Chinese may already be checking their e-mail on the new "Redberry."
/ Source: The Associated Press

The BlackBerry e-mail device is coming to China in the next few months. By then, thousands of Chinese may already be checking their e-mail on the new "Redberry."

The Redberry is not a new version of the BlackBerry that's been designed by Research in Motion Ltd. for the Chinese market. It's the name being used by two unaffiliated Chinese companies selling a BlackBerry-like service on a non-BlackBerry mobile device.

And it's yet another example of how the Chinese market is still more like the Wild West than Western-style capitalism, regardless of Chinese President Hu Jintao's efforts to paint a more progressive economic picture during last week's visit to the United States.

The ploy of exploiting BlackBerry's brand recognition is all the more bizarre — RIM's chief executive called it "weird" in an interview — because of the two companies involved. One, not so surprisingly, is a pugnacious start-up. But the other is China Unicom Ltd., whose majority owner is none other than the Chinese government.

There's another odd wrinkle. There are only two big cell phone companies serving China, both of them state-controlled but publicly traded. China Unicom is the wireless carrier offering "Uni PushMail," the new BlackBerry-like mobile e-mail service. The other carrier, China Mobile Ltd., just happens to be RIM's partner in bringing the BlackBerry to China.

To review, then, one state-controlled company is angling to get a few months head start on another state-run company by playing on the name recognition of BlackBerry. On one level, this might sound impressive since the two rivals appear to be competing as you'd hope they would in a free market. But the obvious infringement on BlackBerry's trademark is so sophomoric that no company would bother trying it anywhere but in a nation with dubious legal protections.

"It's a strange marketing plan," Jim Balsillie, co-CEO at Waterloo, Ontario-based RIM, said in an interview with The Associated Press. "It's kind of brazen, this kind of poke in the eye by China Unicom at China Mobile."

Facio Software Inc., founded by a Microsoft Corp. veteran named Tony Chan, boasts on its Web site that "We are the Redberry!" and that its service is available "before RIMM's BlackBerry." In a press release, Chan was quoted as saying, "The Redberry is not afraid, neither did David fear Goliath!"

China Unicom does not appear to be officially promoting the Redberry nickname, but also has done nothing to force its new partner to tone down. Instead, in a statement to Business Week, the company seems to rejoice in the infringement, saying "China Unicom's Redberry brand not only continues the already familiar 'BlackBerry' image and name, it also fully reflects the symbolic meaning of China Unicom's new red corporate logo." China Unicom did not respond to AP's request for comment.

RIM, like numerous technology companies, isn't about to provoke the Chinese government with a public complaint. "China has it's own gestation cycle and you work with it and you respect it," Balsillie said, allowing only that a matter as "silly" as the Redberry might serve as a "nice test case" to see "what kind of remedies available through the system there are."

That non-confrontational approach does not have the same broader implications as similar stances taken by Google Inc., Yahoo Inc. and Microsoft, which have complied with Chinese censorship demands. (MSNBC is a Microsoft-NBC joint venture.)

While those three have more leverage than they admit, it would be naive to expect them to shun the emerging Chinese market for technology products and services. Likewise, it should be clear that such companies will not be leading the push for reform in China. Notably, before his arrival in Washington D.C., Hu stopped in Washington state for a multi-corporate embrace. This included a dinner at the home of Microsoft founder Bill Gates, whose company has suffered big losses from software piracy in China.

Chinese officials say they are determined to protect intellectual property rights, and the run-up to Hu's visit brought plenty of pledges designed to ease assorted trade tensions.

Earlier this month, Beijing pledged to crack down more vigorously on software piracy. A day before Hu arrived, executives from the state-controlled computer maker Lenovo Group Ltd. met with Gates and Microsoft CEO Steve Ballmer to reaffirm a commitment to ship machines with genuine Windows operating systems. In another gesture, officials pledged to close plants that are producing pirated CDs and DVDs.

Of course, China has made previous vows to enforce copyright and trademark protections with little measurable improvement. It doesn't exactly bolster confidence that, amid all the new pledges, there's a state-run firm brazenly exploiting BlackBerry's name recognition.

It remains to be seen whether China plans to follow through on the symbolic pomp that accompanied Hu's visit. Until then, outside businesses can expect raspberries as usual from Redberry China.