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Sony, PalmOne and the death of the PDA?

The beginning of the end?

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Sony pulls out of PDA market shouts the headlines - but why should they be expected to be there forever? Certainly their percentage of PDA market share figures were good, and the design of the Sony devices was excellent as always. I'm a huge fan of Sony's industrial design prowess. But as is often the case, it's not about the technology, but something else.

In this case, perhaps it's a combination of other commitments, and linked to that, the life expectancy of the number two in the category player, especially in a maturing market.

Arguably Sony's commitment to the PDA market has been very strong, but let's look at the marketing background. The CLIE product line-up is broad, with good design and all the right features. The pricing is fine, although more at the premium user end of the PDA range. Placed with more emphasis on the top-end retailer channel, I more often notice Sony's CLIEs in the top quality department stores, than the regular PC sales sheds. Promotion, for my mind, is always as a smart lifestyle accessory, and not a down and dirty business tool.

Of course, there's nothing wrong with this approach per se, but Sony has other product families to promote too. Laptops are strong sellers, with desktop replacement in addition to the road warrior market for slimmer and lighter devices. And rather than pushing a consumer PDA, perhaps there's more mileage for Sony's other product families in the style-appreciating pro-sumer markets demanding MP3 players, digital cameras and the future mobile games machines.

With the continuing growth of smartphones, the PDA market is maturing and so the devices are moving from the white-collar early adopters, into either the low-end diary replacements for those wanting a two device solution or into more vertical and blue-collar supporting applications. Sony's market was more often what some might term 'black collar' - the designers, creative types, and perhaps even, Mac users. The group most likely to be early adopters of Blackberries and smartphones. Now might be considered the good timing for Sony to move on.

Then there's the life expectancy of the cloner, or market follower. Not that Sony's CLIEs copy PalmOne PDAs directly, far from it, but they occupy a very similar market space. Palm's separation of the software business with the spin-off to PalmSource was wise, and necessary to encourage adoption into a wider range of devices, but this was never going to be enough to massively grow the market for high-tech diary devices. Sony's 15 per cent market share was that of the number two, and unlikely to overtake PalmOne. However, despite pulling the CLIE in most markets, Sony is still planning to offer them in Japan, and retain their investment interest in PalmSource.

So, does Sony's partial withdrawal herald the beginning of the end for the PDA?

Not really, but it might indicate what might happen next in the market, including other platforms such as PocketPC. Without differentiation and the creation of new market categories, there is only room for so many profitable hardware players. It might also mean that like others before it, PalmSource will have to re-focus on the market for compatible products, and continue to derive value from the developer community they have built. If PalmSource licensees think they can compete directly in the same space as PalmOne, ultimately it's not good news for PalmSource, the licensee or the end user.

Better to add extensible PDA functionality to existing products than add PDA products into the line-up. The PDA may be looking dead, but its memories will be kept refreshed by its children.

© IT-Analysis.com

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