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Crowded Global PDA Market
Posted: 25-Aug-2002 [Source: Strategy Analytics press release]

[Among their forecasts, Strategy Analytics new PDA report sees PDAs with integrated WiFi capabilities dominating the market by 2007 accounting for up to 60 percent of sales.]

by Chris Ambrosio, Boston, MA -- The latest Strategy Analytics report, "Global PDAs: Crowded Global Market Grows to US $17 Billion in 2007," concludes that total PDA shipments will post modest growth of 9 percent in 2002. Reduced corporate IT spending levels are expected to restrain the market well into 2003, and will continue to drag on PDA shipments. However, revenues will continue to grow as Pocket PC vendors increase their market share in 2002, and approach 33 percent in 2003.

While revenue growth is positive, overall PDA profit margins are declining rapidly. Profit levels for the industry in 2002 are expected to decline by nearly 20 percent compared to 2001 levels. "The PDA market has seen the aggressive entry of a group of vendors who are accustomed to the razor thin margins of the PC world," states Chris Ambrosio, Director of the Strategy Analytics Global Wireless Practice. "As a result, margin pressure is greater as all seek to compete for the same few customers. Corporate customers are not yet adopting wireless mobility on a broad scale, but there is light at the end of the tunnel."

The report finds that, among those businesses that are spending, PDAs are just a part of the solution. "Business users view the PDA as an 'access' device," states David Kerr, Vice President of the Strategy Analytics Global Wireless Practice, "HP and Toshiba have had success in this sector because they can sell a total solution that favorably positions their PDA in the wireless system 'bundle' with other hardware and services, and they are integrating WAN and WiFi technologies to differentiate their devices in an increasingly crowded market."

Also included in this report: PDAs with integrated cellular connectivity will account for 59 percent of total PDA sales in 2007; the prioritization of WiFi services has relegated Bluetooth to secondary consideration in the PDA market, and Strategy Analytics expects only one third of PDAs to offer integrated Bluetooth in 2007; PDAs offer several advantages in offering entertainment features and services with NTT DoCoMo and Sony Electronics standing out as offering innovative device/feature sets to deliver this functionality to consumer users. Consumers will purchase 60 percent of PDAs sold in 2003, and will still account for a majority of PDA sales in 2007.

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