Ok, who's talking smack about market share numbers?

[Ed Hansberry]

Ok, we've all seen the market share numbers from <a href="http://maccentral.macworld.com/news/0209/11.pda.php">the IDC report</a> that show the 2nd quarter market is down 9% from last year and 16% from the first quarter. But what are they really saying? Confused? Hang on. You ain't seen nuthin yet. And for all those PalmOS enthusiast sites claiming victory in the 5% gain from last year, see below. <br /><br />Ok, the chart below has 4 data columns.<br />• Yellow - 2nd Quarter 2002 shipments (units, not dollars)<br />• Gray - 2nd Quarter 2001 shipments<br />• Blue - 1st Quarter 2002<br />• Green - The growth (or shrinkage) in the market. The left half of this column is the Yellow vs the Gray. The right half is the Yellow vs the Blue.<br /><br />At the bottom, I've grouped by the OS that vendor primarily uses. Other is a mishmash. It has Palm (probably Acer), Pocket PC (Minren) and a bunch of cheapo proprietary devices (like Da Vinci) sold in various places - lots in Asia. I am 99% sure Legend is a PPC player but if someone has definitive proof they sell other things as well, let me know. I know they don't do Palm - at least not according to PalmSource's OEM page.<br /><br /><img src="http://www.pocketpcthoughts.com/images/hansberry/2002/20020913-marketshare.gif" /><br />So, what does it all mean? Here is a quick rundown.<br /><br /><b>OS Analysis:</b><br />• PalmOS did in fact gain 5% from the same quarter as last year in market share (48.7% vs 43.7%) and volumes were actually up 1.2%. Michael Mace has made comments to that effect and when you recall that Mr. Mace is CCO of PalmSource, he is thinking PalmOS, not Palm Inc. Now, what was going on in the 2nd quarter of 2001 for PalmOS? Lessee..... that's right! No M50x devices! The Palm V was rotting on the shelves in warehouses. Mr. Yankowski (Palm ex-CEO) opened his big mouth about the April ship date of the M500 and M505 and buying for existing devices dried up. It wasn't until June that those things really started showing up. So their numbers last year were artifically low. Way low. 5% growth isn't much to get happy about. And then the fact they dropped 30.5% from Q1 volumes.<br />• Windows CE/Pocket PC lost .5% share in the 2nd quarter 2002 vs the 2nd quarter 2001. .005. Not 5%. Say that with me. Point-five-percent. PPC/CE is down 10% in units shipped versus last year (see discussion of the iPAQ iXPLOSION below) and up 5.5% in units shipped over Q1 of this year. Pocket PC units <b><i>up</i></b> 5.5% Q2 vs Q1, PalmOS units <b><i>down</i></b> 30.5% Q2 vs Q1. Pocket PC market share <b><i>up</i></b> 6.6% versus the first quarter, PalmOS market share <b><i>down</i></b> 10.2% in the same period.<br />• Linux.. oh who cares. Next.<br />• RIM is actually up a bit both vs. Q1 2002 (gray) and Q1 2002 (blue). But they are a bugfart in the whole picture, so that's all I'll say about that.<br />• Other got smacked versus last year - down 6% from last year (gray) in share and 41.3% in units. It is up though versus Q1 of this year.<br /><br /><b>OEM Analysis</b><br />• HP dropped in share 6% versus last year but is up 1.4% versus Q1 of this year. Recall that last year Q2 was the quarter that the iPAQ was selling like nuts, so their drop this year doesn't bother me. It was a bit inflated last year from all the pent up demand. They could also be suffering from Toshiba entering the market.<br />• Sony is up huge over last year but up only slightly from Q1 this year. The NR70/NR70V must have been a great flagship product but doesn't seem to have done much for volumes. <i>I wish I had dollars for these reports. I could see if these volumes were expensive or cheap products. That would be four more columns and I could use orange, purple, red and olive.</i> <img src="http://www.pocketpcthoughts.com/forums/images/smiles/icon_smile.gif" /><br />• Palm Inc. shrank in both time periods as shown in the top row of the green column.<br />• Toshiba came from nonexistence last year to take 3.8% of the market this quarter.<br />• Casio. Never have I seen a company make so many changes (new proprietary CE device, then dump Pocket PC) and not budge up or down much. <br />• Handspring... so sad. Oh well. Remember Unisys, the big computer maker? Me neither. Handspring is the Unisys of PDA makers. Can't seem to find their way and in a few years, no one will remember them. <i>{sniff sniff}</i><img src="http://www.pocketpcthoughts.com/forums/images/smiles/icon_sad.gif" /><br />• RIM... oh never mind.

[ThomasC22]

hmmmmm...signs EdH has too much time on his hands...yes, I think so :wink:

Seriously, this is about what I would have expected, I'm surprised the PocketPC hasn't lost more with Sony taking the best features available on the PocketPC and grafting it on to the PalmOS (Sloppily, but still).

In the end, I'm starting to think this battle is going to boil down to a war between Toshiba and Sony. I strongly suspect that Toshiba is just beginning to ramp up their PDA business and when all is said and done we'll see some pretty impressive stuff come out of them.

HP/Compaq on the other hand seems to have lost its way. With their high prices and meaningless features (I like the biometric scanner too but I'm figuring most companies will opt for password protection and save spending a large amount of money on biometric equiped PDAs). Palm's toast...Handspring I'm not sure about (apparently Smartphones aren't included in these numbers so its hard to tell how their doing). Casio's gone. RIM is a StopGap product that won't last another couple of years.

Last thought, I don't think OS is going to matter that much when all is said and done. Once Palm rolls around to PalmOS 6 (5's a joke) and we're at PocketPC 2005 (or so) I think you'll be looking at an equivalent architecture and it will be up to the hardware manufacturers to differentiate.

But then again, thats what they said about PCs too...

[Andy Sjostrom]

Well written post! Really appreciate you taking the time! In fact, we've got quite a few of "Eds Market Share Comments" here on Pocket PC Thoughts, which is great for looking back on market developments.

[DrtyBlvd]

Ditto Andy - but, more importantly,

Can I get an "Amen!" Brother?

:lol:

[Jonathon Watkins]

Nice Figure..... (I mean figures Ed :wink:). Thanks for taking the time to sift the info a bit more.

ThomasC22, surely it’s somewhat to count HP/CPQ out just yet? :? I don’t like the current IPAQ either, but at least give them a chance to get a product cycle out under the new structure.

I do hope that Toshiba goes from strength to strength. We need a good large solid mainstream PPC manufacturer to raise the standards. I would LOVE a 740 with a VGA transflexive screen!!!! :P

[Ed Hansberry]

HP/Compaq on the other hand seems to have lost its way.
This report doesn't show that. Compaq's numbers were inflated last year, so the drop from 600K to 400K units is expected. They did drop almost 9% from Q1 this year - but look at the market. It was down 16% and only Sony, Toshiba and Hi-Tech wealth did better.

The future will tell more, but this doesn't seem to indicate HP is in trouble at all.

[Timothy Rapson]

A good and thorough analysis.

I think you missed one salient point. If M500 news squelched Palm V sales (really the start of Palms whole financial slide) what is news of OS5 doing to current sales? By now PPC should have well over half the market. We may still see that by the time Q3 numbers show up. But, by then the telling Chrismas period will be over.

What I would like to know, even more than total $ volume is profitability. Casio obviously looses money on each model they palm off on someone, from the $49 Pocket managers to the $500+ E200s. Otherwise they would not be getting out of the market.

Compaq makes huge money on their PPCs. According to a report on the new Dell, Compaq pays HTC about $200 for their PPCs. Even after rebates, they are fetching twice that at retail.

I think ThomasC22 may be right about this coming down to Toshiba vs Sony. Compaq and Palm will be in there, but they seem to lack a clear idea of what they can and want to do.

[mookie123]

Palm OEM situation is really bad,

I don't think anybody will dare entering the market competing with Sony. It out compete with cheaper/better device than anybody. Hence the result Palm OS will lose diversity. I got the feeling Palm Inc will not last another year as top Palm OS device maker if the trend keeps continuing.

Sony is having them for lunch.

Let's hope somebody smarten up in PPC, by introducing standard plug/sleeve for low end market or PPC will keep having OEM in and out like musical chair . PPC weaknesses is still price.

[jlc, just jlc]

Legend is indeed a PPC manufactirer - they sell one for the Chinese market:

www.legend-holdings.com

[Wes Salmon]

I don't care what the numbers say, I'm just happy to see the word "bugfart" in a financial/market analysis. ;)

[ChrisD]

Interesting commentary. I do not see the market as black and white as you do:

1. Sharp sells proprietary PDAs as well as Linux based systems.
2. Casio sells PPC/WCE devices and their own proprietary systems as well.
3. Legend does sell PPC/WCE devices - that's been their main focus in terms of PDAs. http://www.legend-holdings.com/eng/consumer_prod_right_5.html

The interesting thing that can be drawn from this information is to look at where devices are being sold. Legend only sells in China. See IDC's summary for Asia at http://www.idcindia.com/Pressrel/International/Int-6August2002.htm From that report, I read that Palm is doing very poorly compared to the rest of the marketplace.

Also, see http://www4.gartner.com/DisplayDocument?id=365701&acsFlg=accessBought for Gartner's projection for the rest of the year.

Thoughts?

[fundmgr90210]

A technical indicator has definately presented itself here:

You can interpret the severity of how bad the news is for PPC by the amount of work Ed goes to prove that's it's somehow a "positive".

Wow, so you'd rather compare Q2 this year vs. Q1 of the same year because it makes a better case? If it was PPC showing market share growth from one year to the next you'd treat these numbers they way everyone else does (year by year).

To make it worse, you've even gone so far as to chalk a lot of this up to Palm's artificially low numbers due to the inventory glut brought on by the 500 series issue. Yet I can recall you (on other boards and maybe here) claiming Palm's market share dip really had to with the fact that Palm's are glorified, overpriced organizers that the market has moved away from (and towards PPC). So which is it?

Seriously Ed, I can't believe you were attacking Mace for spinning (which he was doing) and then turn around 2 days later and do the same thing. Try as you might though, it's impossible to interpret HP's negative growth (and Sony and Palm's positive growth) as anything but bad news for PPC.

Jesus, can you imagine how a drop like that in Palm market share would be handled here?!?! Or if it was Toshiba and not Sony that grew 248% even though it would be due to the fact that they (Toshiba) were coming from such a low number to begin with (which Sony was as well). Maybe this also explains the "Zen of Palm" and worthless Palm stock posts made immediately after this bad news has come out?

Lastly, and as has been stated here before, smartphones aren't included in the IDC tabulation. So Treos (with the exception of the 90), Kyoceras, Samsungs, etc. aren't counted. Handera probably falls into the "other" category as well. While these products don't have big numbers by themselves, I'm sure a 3% to 5% number (maybe more?) would be added to the Palm OS total.

[mookie123]

Yo fundmgr,

uhm you type almost as much as Ed's. Obviously you put a lot of time too. lol.

[Ed Hansberry]

A technical indicator has definately presented itself here:

You can interpret the severity of how bad the news is for PPC by the amount of work Ed goes to prove that's it's somehow a "positive".

The EdH scale. Pronounced "aydach." :way to go:

"Yeah, that report had an aydach factor of 9.1. Total crap - nothing but spin. But over here where the details were presented in a nice clear mannor, cut right to it. aydach of 1.2."

[ThomasC22]

ThomasC22, surely it’s somewhat to count HP/CPQ out just yet? :? I don’t like the current IPAQ either, but at least give them a chance to get a product cycle out under the new structure.


I'm not necessarily counting them out yet but I do think their current model shows that they seem to be heading in the wrong direction (e.g. tossing out things that were good about the Jorndada (form factor) and adding new features that few will ever use). But sure, they could turn it around.

[fundmgr90210]

A technical indicator has definately presented itself here:

You can interpret the severity of how bad the news is for PPC by the amount of work Ed goes to prove that's it's somehow a "positive".

The EdH scale. Pronounced "aydach." :way to go:

"Yeah, that report had an aydach factor of 9.1. Total crap - nothing but spin. But over here where the details were presented in a nice clear mannor, cut right to it. aydach of 1.2."

????