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Worldwide PDA Sales Decline In First Quarter

4/27/2004 01:42:00 PM Eastern

Framingham, Mass. — Worldwide sales of PDAs declined 12 percent during the first quarter this year over the same period in 2003, due to suppliers clearing out inventory and trimming lines, as well as seasonal market shifts, according to the research group IDC, based here.

Many users purchased a new PDA during the holiday season last year leading to a seasonal slump that hit vendors particularly hard during the first quarter, said IDC.

Worldwide sales for the quarter totaled 2.2 million units, down 33.1 percent from the fourth quarter last year.

PalmOne was hit particularly hard by the seasonal shifts, undergoing a sequential decline of 38.7 percent in market share and a 39.4 percent decline over the same quarter in 2003. PalmOne’s share declined to 36.1 percent, although new Zire models are expected to be announced shortly, which should boost share.

Hewlett-Packard posted a strong year-over-year increase of 24.8 percent in share to a market share position of 25.7 percent. Sony’s market share dropped to single digits on a sequential drop of 57.2 percent and year-over-year drop of 49.6 percent.

"Despite increasingly powerful handheld devices reaching the market, the consumer uptake of entry-level devices available from nearly every vendor calls into question the upgrade path and value posed by the high-end devices. If entry-level devices prove to be the most successful products adopted by consumers, the long-term impact could be acceleration away from hardware differentiation and a further loss of value in the handheld industry," said David Linsalata, analyst in IDC's Mobile Devices program.

"Handheld device vendors must continue to search for consumer and enterprise solutions for their products, such as GPS device bundles, that utilize the range of capabilities contained in a handheld device," Linsalata noted.

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