Although the handheld market picked up from first quarter to second this year, it still showled a slight decline over the same period last year.
According to research firm IDC's quarterly market study, the worldwide handheld market shows a slight increase of 3.2% from first quarter to second quarter of 2004 but still posted a 2.2% drop from second quarter of 2003.
The first quarter of the year is typically a down quarter for most companies as customers splurge during the Christmas buying season and then reduce their major purchases for the first part of the following year. As a result, marginal increases from first to second quarter are commonplace for most companies.
Despite the overall dip in the market, several companies did show notable growth. palmOne in particular maintained its number one position worldwide for handheld devices, with a 14.1% sequential growth from first to second quarter and a 4% gain in overall marketshare to take 42% of the handheld market. Most of that is a rebound from a weak first quarter, however, as palmOne's shipments increased only 0.6% year-on-year. IDC believes that a large part of palmOne's rebound was due to Sony's decision to discontinue its CLIE line outside of Japan, leaving palmOne as the only major world-wide Palm OS handheld manufacturer.
HP continued to slide in second quarter, with an 8.2% sequential drop in shipments, causing its marketshare to decline to 24.1%, less than half of palmOne's. However, it was the only other manufacturer to break 10%, and still showed a strong 39.2% surge in shipments year-on-year. HP also has a series of new devices hitting the market soon, which will likely improve sales as well.
Despite withdrawing from the worldwide market, Sony still managed to claim 7.8% of the market. That's still a dramatic 33.2% drop over last year, and with its decision to exit the world market IDC expects its share to continue to decline. Dell, meanwhile, showed 4.6% growth over last year, even though it hasn't fully recovered from the first quarter slump with a 7.8% drop from last quarter. Meanwhile, newcomer Medion has pushed back into the number five spot with 4.1% of the market, jumping ahead of Toshiba with whom it has been trading the number five spot for the past few quarters.
IDC believes the drop to be due in part to continued pressure from the growing smartphone market. According to IDC Mobile Device analyst David Linsalata, "The key to success for handheld device vendors lies in the complementary integration of advanced technology with improved solutions, such as the GPS bundles embraced by vendors such as HP and palmOne, that will enable the handheld device to evolve beyond its core PIM functionality."
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