IDC: worldwide smart handheld device shipments declined 12.1 percent in 1Q02 - Top Story

Mobile Internet, The, May, 2002

The worldwide handheld device market remained slightly depressed in the first quarter of 2002, due in part both to seasonality and to continuing stagnant demand. Shipments declined by 12.1 percent year-on-year in the first quarter, and dropped sequentially by 25.4 percent to 3.25 million.

"Weak macroeconomic indicators still persist in the handheld device market, but vendors are working diligently to stimulate growth and formulate solid enterprise strategies, as the enterprise segment remains the key to future growth of the market," said Welli Su, a senior analyst for IDC's Smart Handheld Devices research service. "While we don't expect a rapid turnaround, the seeds of recovery are being sown. Depending on regional economic environments, worldwide handheld device shipment growth may pick up more rapidly toward the end of the year as vendors debut new wireless-enabled product offerings."

Vendor Highlights:

- Palm. Worldwide unit shipments declined 23.5 percent year-on-year during the first quarter of 2002, and declined 22.3 percent sequentially. Still in the lead, Palm claimed a 39.0 percent share in the worldwide handheld device market, up 1.6 percent from the fourth quarter of 2001. In the United States, Palm captured a 47.5 percent share, down 0.6 percent from 4Q01.

- Compaq. For the first time, worldwide unit shipments surpassed Handspring's. Compaq rose to the number-two position, behind Palm, in the first quarter of 2002. Making strong inroads in the European market, Compaq's worldwide shipment volume grew 18 percent year-on-year. Compaq ended the first quarter with 10.1 percent share of the worldwide handheld device market, and 8.6 percent in the United States.

- Handspring. Worldwide unit shipments fell sharply, declining 44 percent year- on-year, and 24.2 percent sequentially. Handspring's worldwide share decreased from 15.5 percent in the first quarter of 2001 to 9.9 percent this quarter. Handspring captured 14.6 percent share of the US handheld device market, down 2.3 percent from the fourth quarter of 2001.

- Sony. Sony's worldwide unit shipments grew 257.1 percent year-on-year. In the number-four spot with a 7.7 percent worldwide share, Sony is proving its ingenuity by flexing its marketing muscle and becoming a major Palm OS platform OEM.

- Hewlett-Packard. Hewlett-Packard, another Pocket PC manufacturer, saw its worldwide unit shipments decline 43.9 percent sequentially. This decline is not surprising, given anticipation of the HP-Compaq merger. Many speculate that Compaq's iPaq line may become the merged company's handheld device offering moving forward.