* Users offered iPhone, other models
* Moody’s sees majority of 500,000 UAE users switching
* Service providers offer free handsets, discounts
DUBAI, Aug 3 (Reuters) - Mobile phone service providers scrambled on Tuesday to hold onto half a million users spooked by BlackBerry's showdown with UAE regulators, offering them a switch to Apple's iPhone APPL.O and other rival smartphones.
“I’m going to grab the Nokia option, it seems more of a business phone than Apple,” said Wiam Nabulsi, an account manager at an advertising agency in Dubai.
BlackBerry handsets are popular among business people and professionals in the United Arab Emirates, a wealthy oil exporter that includes the Gulf Arab financial hub Dubai.
It also has a following among the young and wealthy, with students choosing the device for its user-friendly chat option.
The UAE said on Sunday it planned to suspend BlackBerry email, web browsing and Messenger services from October 11 unless the maker, Research In Motion RIM.TORIMM.O, allows it access to encrypted messages.[ID:nLDE6720WQ]
On Tuesday, top service provider Emirates Telecommunications Corp (Etisalat) ETEL.AD, which is partly government-owned, began offering free handsets and discounted service packages to prompt users to switch.
Rival provider du telecom DU.DU, in which the government also has a stake, plans similar offers and is set to detail them on Wednesday.
Nawwar Nashawati, who owns an events and concierge services firm, said one challenge would be explaining to overseas visitors why their BlackBerry roaming services would be limited once they land in the UAE.
“But if we want to be on the safe side, we just have to stick to whatever Etisalat is offering us. We can’t risk being disconnected again,” Nashawati said.
For Insider programme on users click: link.reuters.com/myw92n
More stories on BlackBerry click: [ID:nN02151382]
For graphic on smart phone market click: link.reuters.com/fup82n
For ANALYSIS on BlackBerry click: [ID:nLDE67103O]
The popular device has been dubbed CrackBerry in the United States, where some users say they are addicted to using it, and customers in Dubai said there might even be a silver lining to the planned ban on some of its services.
“At least it will give me more time with my wife,” said Amit Sangekar, a marketing manager whose wife works at a bank and relies on the device.
But Erik Becker, who works at International Finance Corp, the investment arm of the World Bank, said the ban would put him out of step with his colleagues.
“We’ll be the only office at the IFC not able to use a BlackBerry. It’s an important tool especially with the weekend being different here,” he said, referring to the Friday-Saturday weekend observed in much of the Arab world.
“It will free up some time and bring us back a couple of years to the time when we didn’t have a BlackBerry.”
Moody’s Investor Service said it expected the majority of the UAE’s estimated 500,000 users to switch to alternative devices over time, sparing providers from hefty revenue losses.
“The period until the ban on BlackBerrys comes into effect will allow Etisalat and du to lure customers into making the switch,” Moody’s said.
(Additional reporting by Nicolas Parasie)
Editing by Jason Neely and Lin Noueihed
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