After losing its dominant position in the mobile world, BlackBerry (NASDAQ:BBRY) has been moving on to new opportunities. One of its latest plays is in securing the next big thing in technology -- the Internet of Things.
BlackBerry said last week that its subsidiary company, Certicom, will issue security certificates to device makers and service providers that want to connect their devices and networks to the Internet of Things, or IoT.
If you're unfamiliar with the IoT, it's essentially the connection of formerly unconnected products to the Internet so that those devices can collect and analyze data, and even automate processes. For example, think of your car collecting driving data and sending it to insurance companies, or your home knowing when you come and go and adjusting the temperature based on your habits.
Certicom recently won a major contract to use its security certificates in about 104 million smart meters and energy management devices in the United Kingdom -- a move that should strengthen the company's position in IoT security.
The right product at the right time
BlackBerry's move comes just as technology companies are in desperate need of Internet of Things security options. Last year, a report from Hewlett-Packard said 70% of the top IoT home devices use unencrypted network services, and 80% have serious security flaws. Internet of Things security is so important that even Congress has weighed in on the need to fix the problem.
Other tech companies have acknowledged the need for more IoT security as well. Intel's then-chief technology officer for security, Michael Fey, said last year, "Security needs to be built in as the foundation of the Internet of Things. Any disruption to these IP connected devices can cause damage to the business and our daily lives."
That's where Certicom comes in. BlackBerrry said the Certicom certifcates will allow companies to authenticate and secure devices that manufacturers create, so they can focus on building products instead of learning how to secure them.
"This cost-effective service will help device manufacturers and service providers secure their IoT networks and ecosystems, ensuring that the devices they connect are known and trusted," BlackBerry said in a press release.
Certicom already has a strong position in the space, with 60 million security certificates issued for energy management devices worldwide. The new contract should make that position even stronger and help BlackBerry achieve broader reach in the Internet of Things.
BlackBerry's IoT hope
BlackBerry is quickly piecing together its Internet of Things strategy as it looks toward the next phase of operations. Having forfeited its position in mobile devices to Samsung and Apple, the company is parlaying its strong position in security into a (hopefully) long-term business.
The number of Internet of Things devices is expected to hit 50 billion globally by 2020, according to Cisco Systems, and IDC says the total value of the IoT market will reach $7.1 trillion that same year. Obviously, all of that won't come from security business, but there will be plenty of room for companies to benefit from all that growth by safeguarding the Internet of Things. For now, BlackBerry is making good strides in the space, and its latest Internet of Things security endeavor through Certicom is another important step.
But BlackBerry will have to prove its worth against a long list of companies making IoT security a priority. Intel, ARM Holdings, Cisco, and others all have their own Internet of Things security ambitions, and it's still too early to tell which one will come out on top.
Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Apple, Cisco Systems, and Intel. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.