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May 1, 2006

Market stats: PDAs bad, Origami good

Posted by David Hunter at 10:44 PM ET.

Charlie Taylor at The Register:

Sales of handheld devices are continuing to fall, according to new figures issued by research firm IDC. The organisation’s latest worldwide Handheld Qview report reveals the total number of devices shipped during the first quarter of 2006 totaled 1.5m, a drop of 22.3 per cent year-on-year.

In 2005, global shipments of handheld devices declined 16.7 per cent from 9.1m units in 2004 to 7.5m.

Handheld device is another name for PDA or more precisely:

IDC defines handheld devices as pocket-sized electronics that lack telephony, may have wireless e-mail, offer a stylus or keypad for data entry and are capable of synchronizing data with a laptop or desktop PC.

The decline affected all the major vendors, so the segment leaders did not change from recent quarters.

Palm Inc. leads the sector with 32.2 percent market share, followed by Hewlett-Packard Co. with 23.5 percent, Dell Inc. with 9.7 percent and Acer Inc. with 7.5 percent.

And except for Palm, they all run a Windows Mobile OS. This trend has been going on for a while as equally capable cell phones (some also running Windows Mobile OSs) pushed PDAs out of the market.

Thinking about the definition of a “handheld device,” if you eliminate the “pocket-sized,” you have an accurate description of the much hyped Intel UMPC/Microsoft Origami devices. However, Origami seems to have some secret mojo with the market prognosticators:

Despite the general shoulder shrugging that greeted the launch of the first Microsoft-based “ultramobile PCs,” the minicomputers are still set to find a market, analysts believe.

According to In-Stat research, the number of devices shipped could rise to 7.8 million by 2011, driven by users looking for a data-centric mobile device beyond their cell phone.

But not a PDA, I guess. Also note that the projected Origami unit numbers in 2011 are nearly identical with the PDA unit numbers in 2005.

Sales of minitablets will likely be hampered by the lack of appropriate processors, In-Stat said, with battery life failing to match the functionality demands of the devices themselves. However, both Intel and Microsoft–primary backers of the new form factor–have said they are working on extending the devices’ average battery life.

All for the good, I’m sure, but any advance also likely applies to real laptop and tablet PCs.

Nonetheless, Samsung today launched the Q1, its first Origami/UMPC product, and some even more optimistic market numbers were bandied about:

Samsung brought its Origami tablet to the United States on Monday, announcing that the device would go on sale at Best Buy’s online store next week and will show up in some of the retailer’s outlets this summer.

Market researcher In-Stat has forecast that shipments of such ultramobile PCs could reach 7.8 million units by 2011.

Intel, though, sees an even brighter future. In an interview, Intel Vice President Gadi Singer said the market opportunity is “absolutely much higher.”

“We’re looking at a market of 100 million units a year,” Singer said, but he did not say when the market would reach that size.

To provide some perspective, 100 million is a bit less than half of current annual global PC shipments. It’ll be interesting to see if the market even approaches the In-Stat estimate, much more the Intel one.

Filed under Coopetition, Hardware, Intel, Microsoft, New Form Factors, Origami, Samsung, Technologies, Windows Mobile

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