Users still hold back on buying handhelds

Handheld shipments continued to decline in the first quarter, as poor consumer confidence and tight IT budgets take their toll on...

Handheld shipments continued to decline in the first quarter, as poor consumer confidence and tight IT budgets take their toll on sales of personal digital assistants (PDAs), IDC said.

Suppliers shipped 2.45 million units in the quarter worldwide, down 21.3% from the first quarter of 2002 when 3.16 million units were shipped. The first-quarter decline comes on the heels of a full-year decline in handheld shipments.

Palm is still the leader with 36% market share among handheld suppliers. It shipped 882,000 units in the quarter, but this is a sharp decline on the first quarter of 2002, when it shipped 1.27 million units.

Hewlett-Packard trailed in second place with 444,000 units in the quarter, or 18.1% market share. If first-quarter 2002 shipments from the former Compaq are included with HP's total from that period, shipments declined 6% from 473,000 units. HP eliminated its Jornada handheld in favour of Compaq's iPaq handheld.

Sony increased its shipments to 400,000 units in the first quarter of 2003, or 16.3% market share. It shipped 250,000 units in last year's first quarter.

Dell Computer vaulted into fourth place ahead of such established PDA suppliers like Toshiba, Handspring and Sharp on strong sales of its two Axim models. Dell shipped 159,000 units in the quarter for a 6.5% market share.

This was the first full quarter in which Dell has sold the handhelds, first introduced at Comdex in November.

IDC defined a handheld device as "a pocket-size device, either pen or keypad-centric, capable of synchronising with desktop or laptop computers. Handheld devices are designed to access and manage data including office documents, multimedia, and games. They do not include telephony but may include wireless capabilities which enable internet access and text communication".

"The market opportunity is evolving toward high-functionality mobile phones, with voice as the 'killer app'," Alex Slawsby, an analyst at IDC, said. Pure handhelds without voice capabilities only appeal to a small market of business professionals, while consumers are much more interested in voice technology, he said.

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