Dataquest: Microsoft OS gains on Palm in PDA market

PDAs based on Microsoft's Pocket PC operating system now account for 30% of the worldwide PDA market, compared with 48.6% for...

PDAs based on Microsoft's Pocket PC operating system now account for 30% of the worldwide PDA market, compared with 48.6% for PalmSource's market leading Palm OS, according to research released by Dataquest.

Pocket PC-based handheld computing systems reached the 30% market share level in the third quarter of 2002, up from 16.2% in the third quarter last year, according to Dataquest.

Worldwide sales of PDAs in the third quarter of 2002 reached 2.64 million, up on the 2.61 million sold last year.

Palm remains the dominant vendor with 809,000 sales, representing a market share of 30.6%, more than double its nearest rival Hewlett-Packard, whose 382,000 unit sales represented a 14.4% market share.

Sony, Toshiba and Handspring completed the list of the top five vendors, which between them hold more than two-thirds of the market.

The gain of the Pocket PC OS against Palm was helped by the strong impact made by Toshiba in the market. From a trickle of sales in the third quarter last year, Toshiba has sold 144,000 PDAs this year.

A further challenge to Palm's leadership is expected when Dell Computer releases a Pocket PC-based PDA later this year, Dataquest said.

"After a slow but steady decline, the Palm OS market share appears to have stabilised, but new challenges are on the horizon," Dataquest said. "Much more competitive pricing from Pocket PC vendors beginning in the fourth quarter of 2002 will, undoubtedly, stimulate growth in Pocket PC shipments and allow Palm less breathing room. Dell and Toshiba appear ready to lead this battle."

Along with Dell and Toshiba, HP, Casio Computer and NEC are the major Pocket PC licensees.

Major players in the Palm OS camp include Palm, Handspring, Sony, Acer, Kyocera and Samsung Electronics. Sharp's Zaurus PDA runs a version of the Linux OS.

In the US, Palm's dominance is clearer. Palm PDAs have a 39.4% market share, and the combined market share of all Palm OS licensees is around 65%, boosted by extremely rapid sales growth of Sony PDAs. The US market accounts for just under half of worldwide PDA sales.

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