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PDA shipments near record levels

Study also finds that Windows CE is the operating system of choice for business-minded road warriors.

Falling prices and wireless connectivity have breathed new life into the PDA market, with sales so far this year on pace to surpass their high-water mark in 2001.

According to a report by Gartner, worldwide shipments of personal digital assistants totaled 3.6 million units in the last three months, a 32 percent jump from the same period last year. The market is now on track to reach 15 million units shipped by the end of 2005, Gartner analysts said. If that happens, it would surpass the previous record of 13.2 million PDAs shipped in 2001.

The study also found that Windows CE is the operating system of choice for business-minded road warriors. The underlying software accounted for 46 percent of worldwide shipments in the second quarter of 2005, followed by RIM with 23.2 percent of the PDA software shipped. PalmSource's 18.8 percent share rounded out the top three.

"Wireless PDAs are increasingly seen as an adjunct or alternative to notebook computers, while favorable exchange rates have enabled more Europeans to purchase PDAs at an attractive price," said Gartner analyst Todd Kort.

The totals do not include smart phones, such as the Treo 650 and BlackBerry 7100, but do include wireless PDAs, such as the iPAQ 6315 and Nokia 9300.

In terms of hardware, Research In Motion's BlackBerry was the most popular device, with shipments growing 64.7 percent, to 840,000, in the second quarter. RIM's market share of 23.2 percent continues to lead the pack, with Palm close behind at 17.8 percent. Dell's and Hewlett-Packard's market share continued to suffer, however, with T-Mobile's Sidekick II and Pocket PC Phone Edition devices pushing Dell out of the top-five ranking, analysts said.

Dell and HP are on schedule to refresh their product lines in the second half of 2005.

On a regional basis, the Western European PDA market grew 94 percent to 1.3 million units in the second quarter of 2005. The region accounted for 37 percent of worldwide shipments, up from 25 percent a year ago. PDA shipments in the United States totaled 1.4 million units, a 1.3 percent increase. Garner blames the stagnant U.S. market on the continuing decline in Palm OS PDA shipments and aging product lines among Microsoft licensees. PDA shipments in Asia/Pacific grew 24.7 percent, with approximately 402,000 unit shipments.

The rosy outlook for PDAs seems to contradict a similar handheld report that came out from research firm IDC last week. It said that shipments of handhelds fell to 1.7 million units in the second quarter. The shift represents a sequential drop of 24.9 percent, and a year-over-year decrease of 20.8 percent.

However, Gartner said it prioritizes its PDA data as a data-centric handheld computer first and a communications device second.

Analyst Charles Golvin with Forrester Research, which does not publish quarterly sales and shipment information, said the biggest problem for PDA makers is that the purchases coming from existing users more than newer ones.