PDA Sales Still Slumping

Besieged by competition from mobile telephones and other wireless devices, worldwide shipments of handheld computing devices are falling.

Shipments declined 2.2 percent to 2.20 million in the second quarter of 2004, down from 2.27 million units during the same quarter in 2003, according to research from industry firm IDC.

The market for handheld devices, also called PDAs, has been in decline since 2001, hurt by a general slump in technology purchasing, competition from wireless devices that perform PDA functions, and by a lack of new applications, says David Linsalata, an analyst with IDC, based in Framingham, Massachusetts.

"The handheld of the 1990s is the same as the handheld of the 2000s in that it hasn't really evolved," says Linsalata.

Exiting the Market

In a sign of the slowdown, the third-ranked PDA vendor, Sony last month decided to exit the market, except in Japan, leaving Hewlett-Packard and PalmOne with over 65 percent of the market between them, according to IDC's numbers.

Sony, which ships the Clie handhelds, saw its market share drop by 33.2 percent in the last year. The company shipped 172,000 units during the second quarter.

PalmOne had the largest volume of shipments, selling 924,000 devices in the second quarter, down 0.6 percent from the same period in 2003. Following Sony's departure, PalmOne remains the only major PalmOS vendor in the market, IDC says.

Hewlett-Packard saw its shipments increase by 39.2 percent year-over-year, selling 530,000 devices during the quarter.