Handheld market dips by a third

IDC says that the latest figures for PDA shipments show a slump of nearly a third.

According to the research company, IDC claims some 5.5 million handhelds were shipped last year, down 28.5 per cent, and that the downturn is becoming more acute as the last quarter of the year showed a 35.9 per cent drop year on year to 1.5 million units.

There were a couple of success stories among the numbers. Palm retained its crown, with a 36.3 per cent market share for 2006. However, that still amounted to a decrease in volumes of 28.3 per cent year on year.

In the full year figures, Sharp made an unprecedented entry into the top five, with a 275.7 per cent annual shipment growth, and in fourth spot, Mio posted a 29.2 per cent annual growth to take just over 8 per cent of the market.

Although Mio hadn’t done enough to pip Dell in third place over the year, the quarter did see Mio edge ahead to take nearly 9 per cent of the market.

Mio’s strength has been in markets in Asia and Europe – markets where Acer, which just managed to get into the fifth spot for the last quarter – is also competitive. However, Mio’s success demonstrates how PIM functionality simply isn’t enough any longer – all of Mio’s PDAs have a GPS receiver built in.

‘The handheld devices market is under intense pressure from networked mobile devices,’ said Ramon Llamas, research analyst with IDC’s Mobile Devices Technology and Trends team. ‘Features found on handheld devices, including personal information management (PIM) functionality, multimedia, and Bluetooth connectivity have also been included on converged mobile devices (commonly known as smartphones) and high-end phones. The proliferation of notebook computers with embedded wireless WiFi has also allowed users to remain connected while on the go, further reducing the demand for handheld devices. Finally, GPS devices have gained momentum in the marketplace, and also negatively impacted handheld devices.

‘Handheld vendors have expanded their portfolios to include networked devices, and put greater focus on the latter,’ added Llamas. ‘In some cases, a vendor has put more resources to developing its converged mobile device portfolio while its handheld device portfolio has remained largely unchanged. In other cases, a vendor’s total shipments for handheld devices have been less than for its personal navigation devices.’

Palm for example, released no new PDAs in 2006, instead preferring to concentrate their efforts on the more profitable and growth area of smartphones with its Treo range of devices. Indeed, Palm’s Life Drive is already being ‘end-of-lifed’ despite the lack of new models.

IDC expects the decline of PDA shipments to continue into 2007.