Palm's market-leadership is under attack

Shipments of smart handheld devices are on a steep upward climb that will see the worldwide market will grow from 12.9 million units in 2000 to more than 63.4 million by 2004, creating an opportunity worth more than $US26 billion, according to forecasts by IDC.

Market trends and market evolution during the past several quarters indicate that smart handheld devices have an extremely positive future. Technological progress, particularly in mobile multimedia and wireless areas, will continue at a rapid pace, and 2001 will prove to be the year when mobile access devices hit their stride.

Personal companions dominate the smart handheld devices market, representing 73 per cent of worldwide shipments in 2000. Most personal companions ship with the Palm operating system, and Palm has dominated this space since its inception. However, new products from Microsoft and Research In Motion have loosened Palm's grip on the market-leading position. Microsoft and Research In Motion have clearly managed to make inroads to Palm's market share. While Palm continues to reign supreme, for the first time the company is facing a solid threat to its dominance. According to IDC, smart phones will be the fastest-growing segment of the smart handheld devices market. From 480,000 in 2000, shipments of smart phones will increase at compound annual growth rate (CAGR) of 164 per cent to more than 23 million by 2004. In comparison, the overall market will earn a 48 per cent CAGR.

Internet phone features will result in strong interest in smart phones which will also receive support in the form of product development from major operating systems and hardware manufacturers.

Indeed, many segments of the smart handheld devices market will benefit from the attention of new vendors, improved operating systems and new kinds of users. 2001 will bring forth the brightness of a dawning smart handheld devices era, with twilight only a distant consideration, IDC analysts breathlessly explained.

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