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Converged Devices Lead Mobile Demand

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The market for handheld and wireless devices is current a bit of mixed bag. A series of research reports from IDC attempt to gauge where the various markets are, and what may be driving them.

The global handheld market recently reported its third successive quarter of year over year decline. IDC’s Worldwide Handheld Qview found shipments decreased 8.7 percent year over year in Q3 20004 to 2.1 million units. The current market leader, palmOne saw its market share decline to 34.7 percent, a 6.9 percent fall. The drop was precipitated by a 20.3 percent sequential decline, making it a 12.7 percent year over year decline. Palm’s loss is HP’s gain. That company increased its market share by 6.7 percent over the previous quarter.

Handheld Rankings
Rank Vendor 3Q 2004
3Q 2004
Market Share
1 palmOne 736,481 34.7%
2 Hewlett-Packard 648,975 30.6%
3 Dell 188,200 8.9%
4 MiTAC 68,500 3.2%
5 Sony 44,192 2.1%
  Other 436,644 20.6%
  Total 2,122,992 100.0%
Source: IDC, October 27, 2004

In Western Europe, the mobile device market (which includes PDAs and smartphones) actually grew 38 percent in the most recent quarter. Over 1.8 million units shipped in Q3 2004, up from 1.3 million units in the same period a year ago. In this market, the survey found the standalone PDA market is growing, though only at a meager 4 percent. European drivers appear to be RIM Blackberry sales and Nokia Series 60-smartphones.

The largest reported growth in Western Europe is for converged devices, which led mobile device shipments with a robust 60 percent year over year growth.

IDC Western European Mobile
Device Shipments, 3Q04
Form factor 3Q04 Share 3Q03 Share Growth
Handheld devices 544,750 30% 524,015 39% 4%
Converged devices 1,301,340 70% 811,470 61% 60%
Total mobile devices 1,846,090 100% 1,335,485 100% 38%
Source: Source: IDC, 2004

In another study, IDC found the “early majority” adopters of mobile devices aren’t interested in the same features that drove early adopters of the technology. A survey of 1,800 early majority adopters found 25 percent of respondents utilized WiFi hotspot access at least 10 times in the past 12 months.

Carrying multiple devices is a commonality among the survey base. Over half carry three mobile devices (mobile phone, PDA and laptop). Almost 66 percent carry both a PDA and a mobile phone. That said, IDC’s survey of early majority adopters did see a clear desire expressed by respondents to minimize their device load. Over half indicate a level of interest in acquiring a converged device that would handle the functionality of multiple devices, such as phone, e-mail and PDA, into a single mobile unit.

In IDC’s analysis, early adopters are preoccupied with style, status and novelty. The early majority, consumers more comfortable waiting until a technology becomes established before purchasing, is more interested productivity and safety.

“When comparing various mobile phone features, attributes like battery life and screen display quality were rated as more important criteria than factors such as one-handed operation, multimedia capability, and brand,” said Dana Thorat, senior research analyst at IDC, in a statement. “Early majority users are more deliberate in their mobility solution decisions, and are clearly focused on proven applications, such as e-mail, that enhance their productivity and add convenience to their lives.

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