The figures for smartphone shipments versus those of handheld computers suggest smartphones are set to dominate the market for portable devices, but IT managers still have a choice to make when kitting out mobile staff.
According to analyst firm Gartner Dataquest, sales of smartphones increased by 66% in 2004, with almost seven million sold worldwide. Meanwhile, handheld computer shipments grew by a mere 5%, racking up fewer than four million units.
Smartphones are on the rise, driven by the ability to fit more functionality into smaller devices. With Symbian and Windows operating systems driving most smartphones, these devices can now, in theory, run almost any application.
On the other hand, handheld computers offer all the benefits of a shrunk-down PC operating system and support for a wide range of enterprise applications, plus voice capability. All of which begs the questions: is there a real difference between the two device types, and which is most suitable for business?
The answers to these questions depend on who you listen to.
Sony Ericsson makes smartphones. Its marketing manager Richard Dorman believes the difference between the two device types is disappearing.
"The difference between the two devices was far more defined five years ago. Now we are seeing the divide narrow as both types of device are able to operate the same applications and offer users similar benefits and convenience," said Dorman.
Having said that, he does not believe the vanishing point has been reached.
"One fundamental difference between handheld computers and smartphones will remain - the design of each device has its primary function at its very core.
"This is why no matter how multifunctional a device looks, it is easily identified as either a smartphone or a handheld computer. This is also why, traditionally, it has been easier to make calls or access personal information on a smartphone or handheld computer, respectively," said Dorman.
"Ease" is a key concept here. Although it is simple to see the difference between the smartphone - a phone with, at the very least, personal information management functions - and a handheld computer with no voice function, the reality is blurred.
Several devices clearly straddle the divide. RIM's Blackberry found popularity on the basis of being a secure, efficient e-mail terminal, but it now offers the capability to receive data from most enterprise applications and is also a phone.
Hewlett-Packard's latest devices in the iPaq family offer instant e-mail in the same way as the Blackberry and a full range of Microsoft applications, plus a phone. Meanwhile, the Nokia 9300 smartphone offers Microsoft applications, Java applications, e-mail and other high-end features.
But these are the exceptions to the rule. On the whole, most people consider the distinction between smartphone and handheld computer to be one that will remain with us for some time.
Robin Hearn, principal analyst at Ovum, believes there will always be the two device types, but they will get closer. "The horsepower of smartphones is becoming greater. And in size handhelds are getting closer to smartphones, though the smaller you get the more usability issues there are."
Fundamentally, one is for primarily for voice and the other is intended to boot up and perform computing functions, said Hearn - and this means the end-user is likely to be different. That is because most devices have not successfully married handheld computing and voice capability.
According to Martin Day, business sales manager EMEA at handheld supplier palmOne, it is size that defines a smartphone. "Developing a successful smartphone is technically very complex, evidenced by the fact that there are very few workable examples out there," he said. Size, he said, has a great deal to do with user acceptance of a device as a phone.
"A study by Intel found that the most important feature of a smartphone as perceived by mobile users was it being 'the right size'. We know how critical this is - the initial perception by the user will fix the limits of how they will use the device," Day said.
"The acid test is whether a user takes their smartphone with them wherever they go - be it business or personal use. When users start doing the 'Sim-swap' routine you know you haven't got a true smartphone."
Conversely, if a smartphone is defined by its size, and it is accepted that usability issues come with that, users do not expect to sit down to do a job of work with one. Rather they are more likely to dip in and out quickly, "sipping" at key data.
Herein lies the limitation of smartphones, said Hearn. "The white-collar traveller could get on the plane and give a presentation in Amsterdam with a high-end smartphone, but the sales guy in a Mondeo on the M4 needs the horsepower you get from a handheld because he needs far more information with him," he said.
If size goes a long way to defining the smartphone, the larger handheld computer gives advantages to certain types of business or employee.
According to HP UK's commercial communications manager David Smith, the extra computing power and larger screen size give the handheld advantages over the smartphone.
"The screen tends to make handhelds bigger, and in the phone market small is considered beautiful. The smartphone experience in messaging is like a finger buffet. You cannot do as much and you cannot edit attachments in the same way as you can on a handheld. With a handheld, the screens are often large and sometimes can be rotated between portrait and landscape," he said.
"This means, for example, it can be used in landscape format for data functions then switched to portrait where that is more suited to the task at hand - say sat-nav functions. Larger, more sophisticated screens mean they can also have touch-screen capability or drop-down lists, signature capture and so on.
"For field sales people, interacting with customers and the back office, the handheld is more appropriate. It carries more information and is more flexible. If you just need to know what is going on, a smartphone is more suited."
So, although there is some degree of crossover between the two device types, IT managers need to choose the device that is best suited to their business. The decision will be made on whether voice is a key feature, with some data capability, or whether data is key to the needs of mobile staff.
Geoff Blaber, research analyst at IDC, said, "It depends on the business and the market they are in. Although we are seeing moves towards a converged device, we are not seeing demand for handhelds slow down. That is because voice functionality is not required by everyone, such as traffic wardens or truck drivers."
Phil Ledward, head of business data products at mobile network operator O2, said the most important question is who is the end-user? "A sales executive may make do with a smartphone but a service engineer will need mapping information, parts details and signature capture," he said.
But what of the future? Trade-offs between voice and data capability are likely to continue, and this means discrete categories of device will survive.
Rick Constanzo, vice-president for commercial relations at RIM, said, "If you want to cram high-end processing power into a device you can, but expect massively reduced battery life."
Some think the market could split into more than two directions. Michael Mace, chief competitive officer at PalmSource, maker of the Palm OS, said, "Market maturity will drive market diversity with many categories of products and different sizes, each increasingly optimised to the requirements of an increasingly sophisticated customer base."
According to Bob Brace, vice-president for mobile in the UK at Nokia, the extra functionality and ability to integrate with existing voice and data systems will mean smartphone use in the enterprise increasing. The figures seem to bear this out, but Brace said there would always be a market for the basic smartphone.
"Basic phone and messaging devices will increase in functionality. But because of issues such as lower production costs from less powerful CPUs, less memory and reduced licensing fees, basic devices will always address a cost-conscious area of the market. No different device types will exist for the foreseeable future."
The challenge for the manufacturers reflects the user experience that IT managers must take into account when planning a mobile strategy - one-size-fits-all solutions are not realistic.
According to Day, although it might be possible to cram all sorts of functions into a small device, it has to suit the way people need to access data or use voice functions.
"I think we will see the obvious - faster processors, more memory, higher-resolution screens and different experiments with data input methods, not to mention support for more wireless communication standards - but many of these future devices will fail because of the uniqueness of mobile computing," he said.
"It is not like desktop computing. Users have a much lower tolerance to clumsy technology. Rather, it has to fit in with working methods, offer great battery life, be simple to live with, and deliver the data they need when they need it, without fuss. And that is where the main challenge lies. Adding features is easy; making them accessible and usable is an altogether different challenge."
And that is the key challenge for business too. The device you select for your employees will depend entirely on what they need to do. So, decide first what needs to be done; then go and find the device that suits your needs and don't be dazzled by technology.
This was first published in September 2005