Saudi BlackBerry deal still not final

Research In Motion is reportedly still working on a deal aimed at mollifying authorities in Saudi Arabia who are demanding the ability to monitor BlackBerry communications in the conservative Mideast country.

So far, the Canadian tech giant (TSX:RIM) hasn't given any details on the proposed agreement.

Late Saturday, Saudi Arabia's telecom regulator said it was giving mobile operators more time to finalize a deal to allow BlackBerry messaging to continue, staving off a ban of the service in the Arab world's largest economy.

The oil-rich kingdom's Communications and Information Technology Commission said companies had 48 hours ending Monday to test a system that would allow them to avert a ban.

Saudi officials had told The Associated Press that RIM had reached a preliminary agreement with Saudi regulators that would allow the government some access to users' data, and that authorities were examining how such a system might be implemented.

They said the plan involves placing a BlackBerry server inside Saudi Arabia, which already has strong controls on the internet to block morally offensive and political content and maintain strict controls on freedom of expression.

RIM declined to comment on the state of negotiations. Saudi Arabia's three mobile operators couldn't be reached.

A deal that allows Saudi officials to access user data in the conservative Islamic country could set a new precedent for how technology companies and governments interact around the world.

Direct access to emails unlikely: analyst

However, technology analyst Nick Agostino said Monday it's unlikely that RIM would provide direct access to business users' emails or texts.

Such information is encrypted and the Waterloo, Ont., company has pointed out that even it doesn't have access to the data.

But Agostino, of Toronto's Mackie Research Capital, says what RIM could do is install a connection or an interim point within Saudi Arabia giving officials there a look at the encrypted data before it reaches RIM's overseas servers.

While there is not the same level of security for BlackBerry's consumer users, the Canadian tech company has built its reputation on providing secure information for its business customers.

Middle Eastern countries like United Arab Emirates, as well as China, India and Indonesia have all expressed concerns about not having access to BlackBerry users' data.

No ban in Bahrain

However, Bahrain's foreign minister said the country has no plans to follow its Persian Gulf neighbours in banning some BlackBerry services because security fears do not outweigh the technological benefits.

Bahrain's Sheik Khaled bin Ahmed Al Khalifa told The Associated Press the handheld devices raise legitimate concerns, but his nation has decided that banning some of the phones' features is "not a way of dealing with it."

"We're not saying there is no security concern," Sheik Khaled said in an interview. But, he added: "There are many other ways for the criminals or terrorists to communicate, so we decided we might as well live with it."

RIM is negotiating with Saudi authorities to avoid a ban on messaging services on the devices, while neighbouring UAE is planning an even more sweeping crackdown on the data services starting in October.

Both countries have cited security concerns. Critics contend that the countries, which maintain tight controls on the media, are also motivated by a desire to monitor users' speech and political activity.

A number of countries say they see BlackBerry devices as a security threat because encrypted information sent on them is difficult, if not impossible, for local governments to monitor when it doesn't pass through domestic servers.