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IT Expected To Push Enterprise Handheld Adoption

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After two years of coming in below analyst expectations, 2003 should be the year that the enterprise finally starts buying and deploying handheld devices, turning what has been the geek’s gadget into the makings of an enterprise powerhouse.

And IT administrators, looking for more control of what’s moving around their network, just might be pushing the handheld adoption charge, according to a new study by IDC, a Framingham, Mass.-based analyst firm.

“Next year, the market will be stabilized a little bit, and there will be more end-to-end solutions to choose from,” says Kevin Burden, program manager of IDC’s Smart Handheld Devices program. “And I think IT will be pushing this…It executives are realizing that these devices are making their way into their organizations, and they have no control over them. They can’t say the devices need to have specific anti-virus software because they don’t own the devices. They can only exercise IT policy if the company owns the devices. It’s a defense.”

For years now, devices like the Palm Pilot and the Blackberry have been people’s favorite gadgets, holding calendars, listing important phone numbers and giving them their email on the road. But the enterprise has been slow to buy into the idea, leaving the consumer to buy about 80% to 90% of the devices on the market.

But Burden, armed with fresh numbers from IDC’s annual adoption study, says that just may be about to change.

In 2001, 83% of the handheld devices shipped were bought by consumers, leaving companies to buy and distribute only 17%. That number was under industry expectations that the enterprise would be picking up about 25% of the devices last year, says Burden. But the drooping economy and tightened IT budgets were blamed for the shortfall. And 2002 is looking to hold steady with the year before.

Next year, though, the enterprise market is expected to shift into high gear and scoop up 29% of the handhelds sold, Burden reports. And in 2004, corporate adoption is expected to move up to 33% or one-third of the market.

Devices Still Too Limited

Christopher Ambrosio, director of wireless device strategy service at Boston-based Strategy Analytics, Inc., says he sees the corporate market for handhelds improving but maybe not at the rate that IDC is predicting. According to Ambrosio, the devices are still too limited and there’s just not enough back-end access to entice most IT managers.

“There’s only so much you can do with that screen size and interface,” says Ambrosio. “They’re limited in terms of synching with larger applications or data…And when you get outside of the corporate campus environment and into a wide area network, data speeds are much slower. It’s still an expensive proposition, so unless you have a specific application where return on investment is very clear, companies are holding off.”

And handhelds still add up to be quite a dip into the pocketbook. A study released this month by Gartner Group, an analyst firm based in Stamford, Conn., showed that each handheld devices drains about $3,000 a year from a company’s IT budget. The actual cost of the handheld, which generally rings in around $300 to $500 a piece, is just a drop in the bucket when you figure in maintenance, IT training, support, new application development and added security.

Those costs, along with the limited ability to connect with backend services and applications is a powerful limitation, according to Mike Riley, chief scientist for emerging technologies at R.R. Donnelley & Sons in Chicago.

“Until those things are addressed and are on par with laptops and desktops, that’s an inhibitor,” says Riley, whose company has bought and deployed a few handhelds but has held off from a major buy-in. “In a year, the advances in the operating system will be more able to manage [corporate information]. There also should be more interesting advances, such as the hybridization of cell phones and PDAs, which people in the tech field will be quick to pick up to reduce the number of devices they’re carrying around on their person.”

Increased Usefulness With IT Involvement

When will companies be buying and deploying handhelds like they do laptops today?

Well, according to Ambrosio, that could take another four or five years.

But he does agree with Burden that when it starts to happen, IT will be one of the driving factors behind it.

“Will IT managers start pushing for corporate deployment to give them control of what’s on their network?” asks Ambrosio. “I’d say they probably will. In progressive companies, they already are…because it makes for a disparate effort within the corporation, and IT has to wrestle with all of that.”

And Burden says IT involvement should mean the devices will become more useful to the corporate worker.

“That’s safe to assume,” says Burden. “With IT involved, you’d end up getting links to corporate data that you need. Email. Team sharing. We should get to a point where you’d have a file open and multiple people will be looking at it at one time — on their handhelds.”

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