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Sales of handheld devices continue to drop

For the ninth quarter in a row

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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 devices, also known as personal digital assistants (PDAs), are pocket-sized devices which are capable of synchronising with desktop or laptop computers. They are designed to access and manage data including office documents, multimedia, and games. Handheld devices do not include telephony but may include wireless capabilities that enable internet access and text communication.

Despite the incorporation of features like Bluetooth, Wi-Fi, expandable memory, and integrated GPS solutions, IDC said the handheld market is continuing to shrink. The research firm said many of these same features can be found on mobile phones and that the inclusion of telephony extends the usability of mobile phones beyond that of handheld devices.

"A decline in shipments following the holiday quarter is expected of mature markets, and the handheld devices market is no different. After nine consecutive quarters of year-over-year decline, many are wondering how long this trend will continue, and whether the market will see a reverse," says Ramon Llamas, research analyst with IDC's Mobile Markets team.

"IDC believes that the market will eventually hit a size where the rate of year-over-year decline will slow to a sustainable level. That size has yet to be determined, but will be sustained by the core users of handheld devices as well as the enhancements found on these devices."

Palm, the undisputed market leader, recorded shipment volumes that were 23.3 per cent lower than the same quarter a year ago. Although increased sales of the company's E2 and Z22 handheld helped lessen the decline, the firm is beginning to rely on its range of Treo Smartphones to stay in the black. The firm ended the quarter with a global market share of 32.6 per cent.

Hewlett-Packard, which is the second biggest mobile device producer in the world, fared even worse during the first quarter. It saw shipments of its handheld devices fall by 30.3 per cent year-over-year. However, it currently has 26.2 per cent, which is markedly higher than Dell or Acer, the third and fourth leading handheld device manufacturers.

Dell recorded a decline of 33.8 per cent in shipments from a year ago and it now has a market share of 11.4 per cent. Acer meanwhile, had the smallest year-over-year decline at 10.8 per cent and, while sales dipped slightly in Europe, it continued to perform well in Asia/Pacific. The manufacturer ended the quarter with 6.5 per cent market share.

Rounding out the leading PDA producers was Mio, which was the only manufacturer within the top five to record a year-over-year increase at an impressive 84.4 per cent. It now has a three per cent market share.

Copyright © 2006, ENN

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