Driven by rapid growth in cellular PDAs, worldwide PDA shipments totaled 4.5 million units in the third quarter of 2006, a 31.9 percent increase from the third quarter of 2005, according to Gartner, Inc. The average selling price (ASP) of PDAs in the third quarter of 2006 declined 13 percent from the same period last year to $351.
"An influx of new cellular PDAs which are subsidized to some degree by wireless carriers resulted in a significant drop in ASP and pushed the market to the highest shipments level in PDA market history," said Todd Kort, principal analyst in Gartner's Computing Platforms Worldwide group. "An estimated 62 percent of all PDAs shipped in the third quarter offered cellular connectivity, up from 49 percent the same time last year. "
Much of the growth in the PDA market in the third quarter of 2006 was generated by cellular PDAs such as Danger, Inc's. (T-Mobile) Sidekick 3, Nokia E61/E62 and Motorola Q. RIM BlackBerries remained the most popular PDAs, accounting for 21 percent of worldwide PDA shipments in the quarter; however RIM only grew 10 percent as it continues shifting its product mix toward smartphones (see Table 1). BlackBerry smartphone shipments exceeded 514 thousand in the third quarter of 2006, up from 188 thousand one year ago.
"The Sidekick has achieved near cult status as a wireless messaging device among the 15-to-25 age group in the U.S., which propelled it to nearly 300 percent growth in the third quarter of 2006," Mr. Kort said. "We have not seen the consumer marketplace gravitate toward a particular PDA model like this since Palm's peak of popularity over five years ago. The trendiness of this device combined with substantial pent-up demand produced a rush to get on board with the new model."
Palm continued to recede from the PDA market, primarily because it doesn't have a PDA model that incorporates cellular capabilities and it's current line is aging. Palm's PDA shipments declined 2.7 percent from the same period last year. However, the company is primarily focused on the Treo and its shipments totaled 484,000, but these are excluded from Gartner's PDA numbers because they are smartphones.
Despite the launch of some new models, HP's PDA business continued to struggle in the third quarter. HP's worldwide PDA shipments declined 33 percent compared to one year ago, with shipments of about 370,000.
Mio Technology ranked fifth in worldwide PDA shipments in the third quarter of 2006 as shipments grew 86 percent from one year ago based on PDAs that feature GPS navigation capabilities.
Microsoft's Windows CE accounted for 50.3 percent of PDA OS shipments in the third quarter, up from 49.4 percent from the same period last year. RIM OS accounted for 20.9 percent of the market, down from 25.1 percent one year ago. Many customers are holding off purchases until the next generation BlackBerry 8800 series is launched in early 2007.
Gartner defines a PDA as a data-centric handheld computer weighing less than one pound that is primarily designed for use with both hands. These devices use an open market operating system supported by third-party applications that can be added into the device by end users. They offer instant on/off capability and synchronization of files with a PC. A PDA may offer WAN support for voice, but these are data-first, voice-second devices. Smartphones offer all the attributes of a PDA, except that smartphones are voice-centric and are designed for primarily a one-handed operation.