Worldwide Handheld Market Shrinks?

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PalmTake that title with a grain of salt. For the purposes of this post, when we say “handheld,” we’re talking non-telephony (or limited telephony) PDA-style devices, which is why you won’t find any mention of RIM or, oh let’s say, Nokia on this list.

According to IDC’s Worldwide Handheld QView, the second quarter of 2006 saw the worldwide handheld devices market experience its tenth consecutive quarter of year-over-year decline, with vendors shipping a total of 1.4 million devices, a 26.3% decrease from the same quarter one year ago. For the first half of the year, vendors shipped a total of 2.9 million units, down 21.4% from the 3.7 million units shipped during the first half of 2005.

“The past ten quarters have provided a combination of factors that have led to this milestone: the exit of vendors from the handheld market, the shift of vendor focus from handheld devices to converged mobile devices (i.e. smartphones), and the increasing popularity of converged mobile devices overall,” said Ramon Llamas, research analyst with IDC’s Mobile Markets Team.

So who’s at the top of this not so admirable list? Our good friend Palm, who, despite posting a year-over-year growth of -25.6%, remained far and away the worldwide market leader of handheld devices with shipments totaling more than the next two vendors combined and 34.9% market share. Of course, Palm has also developed converged mobile devices (read: Treo), which is exactly what the boys from IDC recommend.

“Looking ahead, we expect additional quarters of decline and a flattening out of shipment activity before a return to growth. In order to do that, vendors must discover more market segments, relevant applications, and improved usability beyond personal information management. The inclusion of Bluetooth, Wi-Fi, and GPS have kept handheld devices relevant, particularly for core users. However, more applications must be deployed to reach more users and eventually bring about a stabilizing effect to shipment activity,” Llamas said.

  • thought

    This report highlights the growing popularity of smartphones, for it is those devices who are siphoning away the sales of non-telephone PDAs.

    This report also vindicates Palm’s strategy in putting so much emphasis on developing the Treo a few years back.

    Now the challenge for Palm is getting their OS moving forward again.

  • thought

    This report highlights the growing popularity of smartphones, for it is those devices who are siphoning away the sales of non-telephone PDAs.

    This report also vindicates Palm’s strategy in putting so much emphasis on developing the Treo a few years back.

    Now the challenge for Palm is getting their OS moving forward again.