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Legal tangles don't sour BlackBerry customers

BlackBerry shipments increased by 46 percent to vault RIM to the top spot among PDA vendors in 2005, says Gartner.

Tom Krazit Former Staff writer, CNET News
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Tom Krazit
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Research In Motion's legal difficulties last year didn't keep consumers away from its BlackBerry, according to market share figures released by Gartner Tuesday.

RIM shipped 3.2 million units of its BlackBerry device in 2005, up 46 percent from 2.2 million units in 2004, said Todd Kort, principal analyst with Gartner. The BlackBerry overtook perennial personal digital assistant maker Palm for the top spot in the worldwide market for PDAs, as Palm's PDA shipments fell 25.6 percent.

Gartner's PDA market share numbers include wireless PDAs such as the BlackBerry 8700 and Hewlett-Packard's hw6500 series iPaqs, which are primarily used for data. The numbers exclude smart phones such as Palm's Treo 650 and the Blackberry 7100, which are designed primarily with voice calls in mind, Kort said. This makes Palm's numbers look worse, since the company is aggressively shifting away from the traditional PDA market in favor of its Treo smart phones. Palm shipped 1.95 million Treos during 2005, more than double the 950,000 units shipped during 2004.

The numbers also don't accurately reflect how RIM has continued to benefit from the strong interest in the BlackBerry wireless e-mail system, Kort said. That's because about 858,000 shipments of the BlackBerry 7100 series smart phones were not counted in Gartner's figures, he said. Excluding the 7100 series devices, RIM now has 21.4 percent of the market.

RIM is locked in a long-running legal battle with NTP over patent-infringement claims. RIM has failed to win an appeal of a jury verdict that it violated NTP's patents with the BlackBerry software and devices, but the company is eagerly awaiting the final results of a reexamination of NTP's patents. The company has also developed a workaround that it believes will allow it to bypass NTP's patents if a judge decides to order an injunction later this month that would shut down BlackBerry service in the U.S.

As with Palm, HP's PDA shipments also fell in 2005 as it tried to shift away from traditional PDAs in favor of devices that can make phone calls and surf the Internet. The company ranked third in terms of worldwide shipments last year, but its overall shipments fell 15.1 percent.

HP, with its hw6500 and the newly introduced hw6900 devices, has been trying to position itself as a maker of BlackBerry alternatives, but it has failed to gain as much traction among corporate customers as it would have hoped, Kort said. The company on Sunday announced plans to create a new operating division for handheld devices, separating the unit from its notebook PC division.