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Commentary: Multimedia for handhelds

With its new PCS division, AMD hopes to tap the potentially lucrative market of supplying customers with full sets of multimedia features for handheld devices.

By Martin Reynolds, Gartner Analyst

With its move to create a Personal Connectivity Solutions group, Advanced Micro Devices hopes to tap a potentially lucrative market, supplying customers with full sets of multimedia features for handheld devices.

The market forecast for handheld devices

See news story:
AMD carves entry into device market
are impressive. For example, Gartner Dataquest's forecasts for worldwide PDA (personal digital assistant) shipments are 15.5 million units in 2002 and 19.5 million units in 2003. Cell phone shipments are forecast to exceed 400 million units in 2002.

Gartner Dataquest expects handheld devices to grow in sophistication. The line between cell phones and PDAs will become increasingly blurred. Users of more powerful handheld devices in the future will demand a variety of features such as video decompression and compression, MP3 playback, 3D graphics, polyphonic synthesizers, and multiple wireless subsystems.

Such growing sophistication is creating a market opportunity for semiconductor devices that can provide those kinds of system features. As more and more applications and storage are connected remotely into the wireless network, handheld devices will increasingly act as consumers' mobile connection to their business and personal activities.

The key to success in this market is standardization and flexibility. To support its design investment and make a profit, AMD will have to sell a great many chips. The company has taken the first steps along that road.

However, AMD's use of the MIPS Technologies processor rather than the near-ubiquitous ARM processor may present a challenge in the key handheld and cell phone markets. It would not be surprising to see AMD emulate or incorporate an ARM instruction set into this class of device at some point in the future.

(For related commentary on AMD, see Gartner.com.)

Entire contents, Copyright © 2002 Gartner, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.