Handheld market free fall continues

Handheld sales continued to drop in the fourth quarter of 2004, according to IDC study. Is the PDA dead?

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The global handheld market continued to slide in 2004, with shipments slipping to below 10 million for the first time since 1999, according to a new IDC report.

For the fourth successive quarter in 2004, sales declined on a year-over-year basis to 2.8 million units, the market researcher said Wednesday. For the full year, the figure was 9.2 million units, compared with 10.6 million units in 2003. This is the third successive year of decline since the market's peak in 2001, IDC said.

"Despite a rise in quarterly shipments due to holiday seasonality and consumer uptake of bundled and integrated GPS (Global Positioning System) receivers, increasingly saturated markets and stiff competition from converged mobile devices drove the handheld device market to its third straight year of decline," analyst David Linsalata said in a statement. "This drop stresses the urgent need for vendors to evolve their devices beyond personal information management in order to return the market to a growth path."

IDC's study doesn't track telephony devices such as smart phones or the majority of Research In Motion's Blackberry devices.

PalmOne remained on top of the pack, recording a 59.5 percent sequential gain in shipments. But year-over-year shipments fell by 11.1 percent at Palm. Similarly, despite a quarterly shipment gain of 25 percent, Hewlett-Packard lost 2.7 percent market share due to PalmOne's strong showing, IDC said. HP reported a 10.7 percent year-over-year drop in shipments.

Dell lost 2.2 percent market share in the last quarter of 2004, but it had 4.4 percent sequential and 22 percent year-over-year increase in shipments. The market researcher attributed Dell's better showing to uptake of its x30 and new x50 models.

Medion regained its place in the top-five listing with a sequential rise of 666.7 percent in shipments, mainly due to the push it gave to a major GPS navigation bundle in Europe. GPS devices also helped MiTAC International achieve a 61.4 percent sequential and 444.3 percent year-over-year jump, IDC said. Sony and Toshiba exited the market in 2004.