23/01-04   -   Pressmeddelande

European Handheld Market Returns to Double-Digit Growth in 4Q03, Driven by Low Prices and Retail Bundles, Says IDC

As forecast by IDC, the Western European handheld device market experienced its first annual growth in unit shipments since 2000. According to IDC´s latest preliminary data, a strong fourth quarter boosted shipments to a record 2.6 million units in 2003,
representing growth of 27.5%. Shipments for handhelds in Western Europe during 4Q03 grew to 958,000 units, a growth of 38% compared to the same period last year.

"Last quarter saw pocket PC vendors reap the rewards of an expanded retail presence, in-store marketing, and targeted promotions such as GPS and camera bundles," said Senior Analyst Tim Mui. "A consumer market drawn to attractive low-cost pocket PC offerings and a renewed interest in mobile solutions from large and medium enterprises helped pocket PC devices to overtake Palm OS-based products in 2003."
"The healthy double-digit growth of the handheld market in both 4Q03 and for 2003 overall suggests that by pricing aggressively and offering attractive bundles such as GPS navigation systems it is possible for vendors to stimulate growth in the handheld market by creating demand through innovative marketing," said Andrew Brown, program manager for mobile devices at IDC.

Vendor Highlights
· HP - With a revamped portfolio of Pocket PC 2003 devices launched last summer, HP had the product breadth to target all market segments during 4Q03. By exploiting its image as the high-end PDA brand and perceived position as the technology leader in mobile enterprise solutions, HP was able to grow its market share to 37%. HP was also strongly positioned with its 1930 and 1940 iPaqs, with offers in some countries at below €300, which increased the vendor´s share in retail.
· Palm - Although 4Q03 saw Palm´s market share decrease to 30%, the segment´s pioneer remained the leading vendor for 2003 overall. Despite having the best-selling handheld model in the low-end Palm Zire, 2003 was Palm´s third consecutive year of annual decline in shipments.
· Medion - The German low-cost computing vendor has performed extremely well since it entered the handheld market last year. With the majority of devices selling through German Aldi stores, IDC believes Medion will find it difficult to sustain its current level of growth, unless it expands to new channels.
· Sony - With shipments of 76,130 units, the consumer giant experienced a 3.5% decline in shipments during 4Q03 compared to the same period last year. Sony has been unable to build significantly on its strong entry into the handheld space. Part of this is due to the lack of a complete retail presence throughout Europe, but also because of Sony´s focus on its high-end devices, while in reality its more basic models are more popular with consumers. Over 80% of its sales came from two entry-level models, the TJ25 and TJ35, introduced to address the Christmas retail market. The higher-priced UX50 clamshell product was introduced in 4Q03 to offer differentiation in the retail market.
· Dell - With a limited mobile enterprise solutions offering and no retail presence, Dell will find it more difficult to compete with HP in handhelds than it currently does in PCs. Nevertheless, Dell continued to effectively utilize its strong notebook portfolio to offer bundled PDA deals to customers throughout Europe.

IDC Western European Handheld Device Vendor Shares, 4Q03
Rank Vendor 4Q03 % Share 4Q02 % Share Growth
1 HP 353,665 36.9% 135,000 19.5% 162.0%
2 Palm 287,725 30.0% 355,000 51.2% -19.0%
3 Medion 97,000 10.1% 0.0% N/A
4 Sony 76,130 7.9% 78,900 11.4% -3.5%
5 Dell 39,975 4.2% 0.0% N/A
Others 103,555 10.8% 124,150 17.9% -16.6%
Total 958,050 693,050 38.2%
Source: IDC, 2004

IDC Western European Handheld Device Operating System Shares, 4Q03
Operating System 4Q03 % Share 4Q02 % Share Growth
Windows Mobile 570,670 59.6% 222,835 32.2% 156.1%
Palm OS 372,990 38.9% 443,920 64.1% -16.0%
Other 14,390 1.5% 26,300 3.8% -45.3%
Total 958,050 693,055 38.2%
Source: IDC, 2004

IDC Western European Handheld Device Vendor Shares, 2003
Rank Vendor 2003 % Share 2002 % Share Growth
1 Palm 825,615 32.3% 858,145 43.0% -3.8%
2 HP 810,315 31.7% 564,445 28.3% 43.6%
3 Medion 202,000 7.9% 0.0% N/A
4 Sony 189,660 7.4% 162,535 8.1% 16.7%
5 Dell 121,900 4.8% 0.0% N/A
Others 407,485 15.9% 412,435 20.6% -1.2%
Total 2,556,975 1,997,560 28.0%
Source: IDC, 2004

IDC Western European Handheld Device Operating System Shares, 2003
Operating System 2003 % Share 2002 % Share Growth
Windows Mobile 1,422,765 55.6% 819,330 41.0% 73.6%
Palm OS 1,038,590 40.6% 1,086,415 54.4% -4.4%
Other 95,620 3.7% 91,815 4.6% 4.1%
Total 2,556,975 1,997,560 28.0%
Source: IDC, 2004

Notes:
· Vendor shipments are branded shipments and exclude OEM sales for all vendors.
· Handheld devices are pocket sized and are capable of synchronizing with desktop or laptop computers. Handheld devices are designed to access and manage data including office documents, multimedia, and games.
· Handheld devices do not include telephony but may include wireless capabilities that enable Internet access and text communication. These devices feature evolved operating systems or application environments such as the Palm OS, Pocket PC, Windows CE, Handheld PC 2000, and Linux or proprietary solutions and have the ability to download and run applications and store user data beyond their required PIM capabilities.

IDC’s European Quarterly Handheld Tracker monitors vendor sales and market shares across a range of key European geographies. For more information on this product and its deliverables, contact Program Manager Andrew Brown on +44 (0) 20 8987 7209 or email abrown@idc.com. Alternatively, contact your local IDC office.

About IDC
IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC´s customers comprise the world´s leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world´s leading IT media, research and exposition company.
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For more information, contact:
Andrew Brown
+44 (0) 20 8987 7209
abrown@idc.com

Terry Cummings
+44 (0) 20 8987 7231
tcummings@idc.com