FRAMINGHAM, Mass. -– The worldwide market for handheld devices grew in the third quarter of 2003, largely due to the introduction of several new devices by Hewlett-Packard. According to IDC’s Worldwide Handheld QView, device shipments rose by 1.1% year-on-year in 3Q03 and increased sequentially by 9.4% to 2.37 million units. The Palm Solutions Group maintained its top position in the market, while Hewlett-Packard rose sharply, distancing itself from number 3 Sony and moving closer to the number 1 spot.
Hewlett-Packard’s 52.5% sequential gain came on the strength of five new devices released at the end of 2Q03 as well as the introduction of the h1935 during this past quarter. The recent availability of two new models at the beginning of this quarter should allow HP to continue its newfound momentum. However, as this increase follows on the company’s 16.7% sequential drop in 2Q03, IDC believes such sudden growth to be the result of a careful channel strategy designed to successfully manage its product transition through one quarter of shipments.
“This quarter’s performance represents a rare positive sign in a handheld device market fighting competition and harsh consumer and enterprise spending conditions. While personal information management has proven to be the killer application for more than 25 million users worldwide, handheld devices must evolve with new segments, applications, and technologies if the market is to remain relevant,” said David Linsalata, associate research analyst in IDC’s Mobile Devices program. “Unless holiday season demand proves particularly positive, the handheld device market will decline more steeply in 2003 than in 2002 as it returns to 2000 levels.”
Palm – Palm’s market share declined from 41.8% in 2Q03 to 35.6% this quarter due to a slower than expected end-of-summer sales of current models. However, Palm launched three new devices at the beginning of 4Q03, the Zire 21, Tungsten E, and Tungsten T3, all of which are poised to build on the strong sales of their predecessors.
Hewlett-Packard – HP experienced a leap in market share from 17.6% in 2Q03 to 24.5% this quarter on the strength of five new devices launched in June as well as the August introduction of the new h1935. With this advancement, HP significantly narrows the gap between itself and market leader Palm and looks to continue its gains during the fourth quarter.
Sony – Despite a slight increase in sales, Sony’s market share declined from 11.9% in 2Q03 to 11.5% in 3Q03 largely due to increasing shipments from HP.
Dell – Dell experienced solid growth in the Asia/Pacific market, but this gain was offset by slower sales in Europe and an aging Axim product line. Dell’s recent introduction of the Axim X3 and Axim X3i, however, should once again spur sales in 4Q03.
Toshiba – With the introduction of the e350 and the e750 in late June, Toshiba maintained its position as the number 5 vendor in the handheld market and experienced a slight gain in market share from 3.5% in 2Q03 to 3.6% this quarter.
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