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Handheld Device Decline Creates Opportunity

The worldwide handheld device market opened the year with its thirteenth consecutive quarter of year-on-year decline as user interest continued to transition towards converged mobile devices and other consumer electronics devices.

According to IDC's Worldwide Handheld QView, vendors shipped just over 900,000 handheld devices in the first quarter of 2007, 36.3 percent less than the previous quarter and 40.6 percent less than the same quarter a year ago.

The decrease in shipments coincides with the announcement that one of the leading vendors, Dell, is leaving the handheld device industry.

"Dell's exit from the handheld device market underscores the market's decline," says Ramon Llamas, research analyst with IDC's Mobile Device Technology and Trends team. "The features found on a handheld device are not exclusive to handheld devices."

Personal information management, the key feature that once distinguished handheld devices, can now be found commonly on converged mobile devices. The growing popularity of converged mobile devices combined with declining prices for laptop computers have put tremendous pressure on the handheld device market.

The addition of multimedia and GPS features onto handheld devices did not stem their decline because standalone multimedia players and personal navigation devices grew in popularity. IDC believes that the growth in these other segments have come at the expense of the handheld device as vendors have responded eagerly with new, feature-rich products.

However, I believe that the exit of Dell from this category actually creates an opportunity for the remaining vendors. I own a Dell Axim pocket PC, and associated accessories. I believe that an application specific device, like a pocket PC, has a significant multifaceted niche in the global marketplace for computing and communication products.

Granted, pocket PCs are apparently not a mainstream product, but vendors who take the time and effort to profile and segment the user needs could identify new growth. As an example, since battery power limitation is the most frequently mentioned problem with mobile phones, many users (myself included) prefer not to use a smartphone for mission-critical computing and data communication applications.

In fact, rechargeable battery performance is such an unreliable technology that I travel with fully-charged spare batteries for both my mobile phone and my pocket PC. For this reason alone, converged handheld mobile devices do not meet my needs now, or in the foreseeable future.

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