iPhone 5 in the enterprise: Pain or gain?

Three IT execs say they're prepared for Apples new LTE smartphone

If the new iPhone 5 with LTE wireless sells as well as analysts predict, its impact on IT shops already wrestling with the Bring-Your-Own-Device (BYOD) trend could be dramatic.

Some analysts predict higher cellular network data costs borne by corporations and greater security risks with the new iPhone 5, which Apple unveiled today.

On the other hand, three IT managers said they believe the iPhone 5 will be manageable from a security and wireless data service cost aspect. One CIO said it will probably be a boon to worker productivity.

"Business runs today in real time, and workers want to do things fast, so from that perspective, the iPhone 5's LTE can provide that real-time capability," said SAP AG CIO Oliver Bussmann in an interview minutes after the iPhone 5 was announced. "The future is a mobile one, and we're constantly looking at any desktop app that we can move to mobile. One of my responsibilities as CIO is to enable a new user experience when possible."

Bussmann said he supports 60,000 workers globally, including more than 40,000 smartphones and tablets that are managed through SAP's Sybase Afaria Mobile Device Management tool, which SAP also sells to other corporations. Afaria can also be used to provide telecom expense management so that Bussmann gets automated warnings when data usage thresholds are exceeded.

SAP, like many large corporations, also negotiates flat data rates with wireless carriers to keep down data costs, Bussmann said.

He estimated a large number of SAP's 13,000 existing iPhone users will want to move to the iPhone 5, but workers have the option of testing out Android devices such as the Galaxy S III, too. SAP creates about 100 different mobile apps for enterprises, many of them used internally.

Terex, a global manufacturing company with 1,000 smartphone users, already supports the iPhone and Android phones under a BYOD framework. "The iPhone 5 won't change our thinking," said Terex CIO Greg Fell, in an interview. "We'll keep buying them like before. People will be happy with the LTE support."

Terex, like SAP, has negotiated data rates with carriers, making concerns about a data usage explosion from the iPhone 5 less of a worry, Fell said.

Alex Yohn, assistant direct of technology for West Virginia University, said some of the college's 30,000 students in Morgantown, W.Va., have talked about wanting to buy an iPhone 5. But he said that the area is not served yet by LTE, making that a less important feature. About 40% of the 450 staff members in IT jobs use smartphones, he said.

Yohn said iOS 6 and iPhone 5 don't provide enough software and hardware changes over earlier models to cause support concerns for his staff. Many users on campus rely on Wi-Fi, which could take the brunt of more data traffic from the iPhone 5 or other new smartphones. Even so, Yohn said the university is prepared.

"With the influx of new devices, we're going to batten down the hatches and hope things go well, but we're not anticipating massively changing our network and we don't expect data traffic at any levels to hurt our network," Yohn said in an interview.

Students on campus are migrating to using Google mail with native device clients "which lessens our worry that any new smartphone device will cause any kind of infrastructure impact," he said.

Despite those low-key expectations, some analysts said the iPhone 5 could cause disruptions, especially if it sells in the numbers some experts are predicting. Most agree the re-designed iPhone 5, with its larger 4-in. display, faster processor, better optics and LTE, will be popular, with one analyst at PiperJaffray predicting it will sell 10 million units by the end of September.

Pre-orders for the iPhone 5 begin Friday; it goes on sale September 21, Apple said.

Keith Shaw and Ken Mingis discuss the features of Apple's iPhone 5 smartphone, and whether the larger screen, 4G LTE network and other features will excite the legions of Apple fans.

Should large numbers of workers buy up LTE-ready iPhone 5's to use on the job, their impact could generate greater corporate costs to cover expensive data plans from wireless carriers. That's especially true for smaller companies subject to data-sharing plans implemented by Verizon Wireless and AT&T, analysts warned.

A big lure of LTE comes from the ease of sharing photos and video more quickly and easily on the job, analysts said. More images than ever can be sent out unauthorized and, therefore, pose a security risk to enterprises, one analyst predicted.

The iPhone 5 features a larger 4-in. screen and LTE wireless capabilities. (Image: Apple)

"Given the weakness of Research in Motion and BlackBerry, the iPhone 5 wave could move a massive number of workers over a short period to a new, relatively unsecure device, resulting in security breaches," warned Rob Enderle, an analyst at Enderle Group, in an email interview. "Greater picture sharing with a new generation of users suggests unauthorized pictures will be shared of unannounced products, bad executive behavior, and confidential events that find their way out of the company far more frequently."

If a company is paying for workers' data plans, or sharing those costs, he added, "companies may find their charges go up sharply before their employees get benefits." That's because LTE networks don't yet have widespread coverage nationwide and data plans are "very expensive," Enderle said.

"The iPhone 5 represents a brave new world that many of us will likely, in hindsight, regret," he concluded.

Mark Urban, senior director of product marketing at Blue Coat Systems, said many IT shops are still in reaction mode to the flood of smartphones and tablets used by workers, so the newest iPhone continues to put businesses on the defensive. Blue Coat sells hardware to help help maximize corporate network efficiency.

"There are twice as many mobile devices per user compared with just a few years ago and each device is driving 10 times to 100 times more traffic," he said. "Our conservative estimate is that each mobile device has the potential to contribute 15 GB [per month] of traffic to the corporate network."

That could mean a doubling of the telecom service budget for a business, Urban said.

Troy Fulton, director of product marketing for Tangoe, a telecom expense management provider, said the iPhone 5 will create a "dramatic uptick in demand on IT staff" because it will be so popular.

The larger screen, up from 3.5-in. in previous iPhones, will be more useful to workers for running corporate apps, he said.

Because the device will be attractive and fast, more data than ever will be used, Fulton said. "Technology leaders should be concerned with the iPhone's data plans and users blowing past them," he said. "There's a dramatic cost risk."

Some carriers are advertising LTE download speeds in excess of 10 Mbps, but speeds could be much higher as networks improve in coming years.

Fulton said organizations that have implemented a BYOD strategy already will find the iPhone 5 "not much worse" than integrating other smarpthones. Also, iOS 6 is not much more challenging to manage than iOS 5, he said.

iOS 6 is due to roll out next Wednesday, Sept. 19.

"What should cause concern is the increase in data demand and how to manage that demand," Fulton added.

Despite some concerns about a BYOD impact from the iPhone 5, Jack Gold, of J. Gold Associates, said the phone will not make much difference in its impact on IT. "People are already bringing in all kinds of devices to the office," he said. "It doesn't make much difference if its 3G, 4G, LTE or more. The real issue is, can the company manage the devices that people bring in?"

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His email address is mhamblen@computerworld.com.

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