"The Death of the Handheld Computer" Says Rob Enderle

[Jason Dunn]

<div class='os_post_top_link'><a href='http://www.eweek.com/article2/0,4149,1306665,00.asp' target='_blank'>http://www.eweek.com/article2/0,414...,1306665,00.asp</a><br /><br /></div>Ah, here's an article that should stir up some interesting discussion. Here's what Rob has to say:<br /><br />"Whatever happened to the handheld computer market? A segment that seemed to have limitless potential just a few years ago now seems to be flirting with irrelevance. Right now, there are too many vendors in the space. Dell is driving the margins out of the segment; laptop computer prices are dropping to within a few hundred dollars of high-priced handhelds; and converged devices (cell phone/handheld computer) have generally proven to be a joke on those who bought them. <br /><br />The choice seems clear: Either the market for these devices needs to expand, or some vendors will have to exit. Some (like Philips) have left, and Handspring was recently acquired by PalmOne. Three major mistakes stunted handheld computing's growth. The first is standards (or the lack thereof); the second, excessive focus on technology instead of user needs; and the third, a dearth of marketing focused on the segment itself, not the devices."<br /><br />He goes on to talk about the worst issues causing problems in the adoption rate of handheld computers. What do you think? Is he right?

[easylife]

Just like weathermen, I don't believe market analysts one bit. There's still plenty of room for the handheld market. :D

[LarDude]

Although it pains me to say this, I just might have to agree with some of the author's comments. (Someone, please tell me I'm out to lunch).

1. Laptops are becoming incredibly affordable. (Didn't they outsell desktops in one of the more recent fiscal quarters)? Economy of scale = even lower prices? (I know they're a different market, etc, etc...but one can't help feeling that they'll take a bite out of PDA sales, given the much smaller price differentials).

2. Notwithstanding HP's excellent efforts to come out with new products, there doesn't seem to be anything "new enough" with the PocketPC platform.
(Same old thing. When are we going to get upgraded screen resolutions?
128MB or 256MB RAM?) Is it me, or does it seem like things are slowing down, especially from an "excitement point of view"?

3. When I look at a magazine like Pen Computing, they seem to be dropping PocketPC's altogether (and they used to have a pretty pro-PocketPC slant).

Just my 2 cents.

[easylife]

When are we going to get upgraded screen resolutions?
128MB or 256MB RAM?
The upcoming Toshiba e805 will sport a 640x480 screen and I believe another Toshiba model and the iPaq 5550 series have 128MB RAM. :wink: Things aren't moving THAT slow! :D

[felixdd]

I want to bring up this question -- has there been really revolutionary developments on the laptop scene that isn't seen in the PPC world as well?

Laptops are getting smaller -- so are PPC's
Laptops are getting more memory -- so are PPC's
Laptops are getting better graphics processors -- so are PPC's

Granted that this article was probably written before the Tapwave was released, which is a radical departure from the PDA form factor (probably a larger departure than the Sony U101, probably the most "radical" improvements recently, being so small and all). Even so -- if the market analyst said that the market is dead since there's no innovation's, someone should smack him with a tapwave, then let him play a few games on it.

And his example of a dying market is Philips leaving the PDA world? That's nearly ten years ago! A more appropriate comparison would be Casio. It shows how much research the analyst actually did.

Honestly -- I think this is just bitter-talk by people that's trying to compare the initial boom of a new industry with current trends. You have to remember one thing: when a new industry starts there's always a burst of increase, which levels off eventually as saturation is reached. Subsequent growth is much slower, and it is unreasonable to try to compare this slower growth with the initial burst of new developments.

That said, I think everyone would agree with me when I say that if the tech market dies (or suffers very badly), the PDA market is the first to fall.

[whydidnt]

I think Rob's been reading PPC Thoughts. :D Look back at my comments in the "Waffle House" thread. He's saying the same thing as I am about the lack of standard connectors, memory cards, etc.

I agree with a lot of what he's saying here, but don't necessarily think of it as killing the market, rather just limiting it. The relative success of the low end units shows there is a market, it's just a price point below what most manufacturers can make money at. However, if someone can deliver an "instant-on" handheld size PC running Windows XP at $600 then he is right in that Palm and PPC are dead. However, the actual handheld market would grow tremendously as a result of such an invention. I venture to say we will see such a device in most of our lifetimes.

Whydidnt

[LarDude]

When are we going to get upgraded screen resolutions?
128MB or 256MB RAM?
The upcoming Toshiba e805 will sport a 640x480 screen and I believe another Toshiba model and the iPaq 5550 series have 128MB RAM. :wink: Things aren't moving THAT slow! :D

Yes, I remember seeing those articles on this site and getting somewhat excited about it. But then one hears all these caveats that they may only be rumours, and that if they are more than rumours, there is: the time to market, whether or not Toshiba will offer the product in North America, does the device have built-in WiFi or not, etc, etc...and then it sounds like the product is a million years away or might just die on the drawing board. (Yes, I'm impatient).

As far as 128MB RAM is concerned, c'mon really, that's should not have even been yesterday's news, it should have been the day before yesterday's news. (How many years has Times2Tech -- or whatever their correct name is -- been offering 128MB RAM upgrades??). As far as I'm concerned, 128MB should have been standard when the iPAQ 5400's came out, we should be pushing the 256MB envelope by now. (If games are going to be one of the areas that the PocketPC's are supposed to show off its strength, how is it going to do that on a piddly 64MB, or worst 48MB because of the dredded NAND memory "cheapout").

Finally, all the compactflash and SD gadgets seemed to have really slowed down lately (OK, so there are a few more GPS CF cards). Where are all the new CF and SD toys?

Whoa!....sorry, that almost turned into a rant :wink:

[SofaTater]

I don't care how low laptop prices go -- until I can slip one into my pocket, I don't see how they are going to drive the handheld out of its niche...

[bdegroodt]

I've followed Ron's work for a very long time and one thing you have to keep in mind is the fact that much of what is written by "analysts" is weaved with truth and embellished a bit for publicity's sake. In fact, a quick trip over to Ron's site will tell you Rob has been ranked #1 since 1995 in press coverage world wide It's not to take much away from his work, but it's an important filter to apply to the article.

Fundamentally, I think much of what he writes is similar to the thoughts a lot of us have here.

[Foo Fighter]

I'm afraid there may be a great deal of truth in Enderle's assertions. Handheld sales are continuing to whither. According to NPD Techworld, sales for the back to school month of August dropped by an astonishing 30%. A market segment can't experience a drop that drastic without something being seriously wrong. And analysts are forecasting an equally atrocious Q4. Things are not looking good for the PDA sector. I myself have noticed a frightening trend, it's getting harder and harder to steer new users towards PDAs. I would be willing to bet money that the majority of consumer handheld purchases are going to second time+ buyers. The PDA industry is maturing, but one could also argue it's stagnating. You can almost feel an impending sense of doom. :|

[bdegroodt]

Good facts Foo. I wonder if this has anything to do with the "flight to quality of life" factor we're all supposed to be going through as a nation now. Not that I've observed this (or participated), but I'd be curious to identify the root of it.

Personally, there was a time when I thought I may never need my laptop given the power and ability of the PPC. That all changed for me when I got my new BlackBerry and realized that I may never use my laptop for EMAIL again, but I indeed will always need my laptop for many other things.

[pedroboe]

Hi all:
I believe that things will go like the way they did in Japan. Ten years ago everyone in Japan was using PDas: the early Zaurus, the Casio digital diaries, etc. Now they have access to all on their phones. tha's why modern PDAs don't really sell as much in Japan, including Pocket PC's. Japan already went through the PDA frenzy, many years ago, before Palm was even proliferating here in the US.They also have smaller laptops now, I admit it.... but we are getting more and more integrated capabilities on our phones. It's happenning to us too. I still have an ericsson R520m, but my next phone could very easily replace my Dell Axim. I find myself using it less and less

[ombu]

"Does anybody here remember Vera...?" :oops: sorry, calc wars?

Maybe I'm too old now, PDA fever has been my second mobile device 'marriage'.

I started with a TI-51A, wow :) , and later I became an HP and RPN lover, each new top line calculator bought until everything broke apart, my trusted 41 CVX was the last one to make me feel alive, not the 48 neither the 49G and all I can see is what's left from that market, RPN root-blasted by ... HP!!! 8O , TI focusing on students (it's the price, idiot!!! :twisted: ) and the allmighty HP 12C, and everything from those days fits now inside my PPC's RAM. 8O

Then and nowadays, PDA came into my life.

IMHO there'll always be PDAs, as there are calculators still, but this second 'marriage' of mine is loosing passion fast and I know (I feel) the end is close, if something has to be learned from history.

I agree with some article's lines, disagree with others and a few of them are totally new to my knowledge, but I can see a big reason why PDA's world will stop to be what it is, they're not being adopted by corporations as fast as it was suposed to, and other devices are coming close to offer almost everything a PDA does, maybe it's fate is to vanish between smaller-cheaper laps and bloated mobile phones, who knows, just wish something really exciting would happen and make them rise again but I can't see it, so..., maybe I'll have time enough for a third marriage, and maybe, just maybe, there's another old timer like me here (hey, you're all too young! :wink: )who thinks and feels as I do, and sure I know there are people loosing their PDA passion, it has been posted a few times somewhere in this forum.

Just my thoughts.

Regards.

[KH]

I wonder.

I am seeing PDAs coming into their own in new areas. People who NEVER thought about owning one have become comfortable about their potential. Like the teenagers who can surf in bed off off the family wireless hub. Or the woman at the barn where my horse is stabled seeing my IPAQs in use often enough that she decided she could use one - and now she has audio of her grandchild's first laugh attached to his baby pictures in PQV (plus she is hooked on Spider Solitaire.) I think a manageable price point is important, but laptops will never fit in purses and backpack pockets the way that PDAs can! And 50 year old women discovering that they can read Agatha Christie in line at the grocery - in LARGE print - can spend a lot of money!

[Bruno]

When are we going to get upgraded screen resolutions?
128MB or 256MB RAM?
The upcoming Toshiba e805 will sport a 640x480 screen and I believe another Toshiba model and the iPaq 5550 series have 128MB RAM. :wink: Things aren't moving THAT slow! :D

I don´t think that Toshiba e805 will sport a 640x480 screen. If you check the facts we know (thaks to RCC) that it will have a ATI Imageon 3200 Graphics chip.

And if you look att the feature sheet for this chip (http://www.ati.com/products/imageon3200/features.html) you can read that it supports a max resolution of 320x480 at 16 bpp. So we will not se a full VGA screen but probalbly a follow up act to Palm T3 which also has 320x480.

Still av very good screen resolution for a handheld computer 8)

[clinte]

Rob Enderle: "So far, Bluetooth has been one of the biggest market disappointments in the history of this industry, easily eclipsing the growing pains of USB and Ethernet. Many of the devices are still incredibly hard to set up, don't work cross-vendor, and have substantial reliability issues."

So so. Big words. He doesn't seem to know that Bluetooth is a relative new technology compared to WiFi. But we can say that Bluetooth didn't achieve the hyped and bullish figures from a few years back. That's for sure. But there is much more realism these days and it's not very interesting to bring up that old hyped stuff from the past imho. Bluetooth will find it place although it will take some time.....

Bluetooth, Wi-fi expected on 25 million vehicles within 5 years
http://www.linuxdevices.com/news/NS2150004408.html

October 03, 2003 -- Bluetooth shipments ‘to reach 70m in 2003’
http://www.macworld.co.uk/news/main_news.cfm?NewsID=7014
http://www.electricnews.net/news.html?code=9377022
http://www.itweb.co.za/sections/quickprint/print.asp?StoryID=137453

[PatrickD]

I can never understand why my parents still insist on “going” to the bank instead of using online banking, or why they insist on using a paper organizer instead of a PDA. Maybe my kids will wonder why I insist on using a cell phone and a PPC instead of the zap3000 cerebral cortex implant running hypersonics thought processor 4.0 :robot: . PPC may eventually die (not for a long while I hope), but there will always be cool technology. :D

[Talldog]

Maybe my kids will wonder why I insist on using a cell phone and a PPC instead of the zap3000 cerebral cortex implant running hypersonics thought processor 4.0
I sure hope when v4.0 comes out, Microsoft fixes that security hole. You know, the one where anyone with a Sears garage door opener can take control of the cortex implant and execute commands against your central nervous system. I keep telling people not to double-blink on those neural attachments if you don't recognize the sender, but nobody listens.
:roll:

[PatrickD]

Notice I said it was running Hypersonics thought processor, and not the Microsoft mobile compact framework .net cranial implant thought discombobulater, or MCFNCITD for short. :D

[Kati Compton]

I think there would be more "upgrading" of PDAs if there was really something "new" to buy. As it is, while I would *like* to have a shiny new 2215, I can't justify ditching my Axim for it. There just isn't enough that's new about it.

Now, if there were a VGA clamshell PPC? Then I'd be buying.

[PatrickD]

I think there would be more "upgrading" of PDAs if there was really something "new" to buy

I think thats the problem. They aren't attracting "new" buyers.

[greenmozart]

My experience thus far has been that most people I live and work with don't like gadgets. They are happier doing things the way they've always done them - be it a paper datebook or rolodex filled with business cards. They are VERY skeptical of having to learn something new, despite the obvious and glaring benefits to their productivity, organization, easy access to gobs of accurate and up-to-date information, etc. They just don't want to admit that technology can improve their personal life as well as their professional life. (yes I work with a ton of Luddites)

I almost take it personal when people discount the benefits of PDAs, or smartphones or whatever your gadget of choice may be. It's as if they are kicking sand in the face of my geekdom. :D

As to the "impending death" of the handheld industry, I agree that we can't compare recent trends to the initial onslaught of the market. But I do admit that I use my PDA far less today than I did a year ago. I'm even considering replacing it completely when the first CDMA smartphone hits the US. I'll probably keep it around, but I won't take it everywhere I go... and I most likely won't spend a lot of money on accessories or upgrading to a new one every 6-12 months like I did for a couple years.

[madmaxmedia]

My experience thus far has been that most people I live and work with don't like gadgets. They are happier doing things the way they've always done them - be it a paper datebook or rolodex filled with business cards. They are VERY skeptical of having to learn something new, despite the obvious and glaring benefits to their productivity, organization, easy access to gobs of accurate and up-to-date information, etc. They just don't want to admit that technology can improve their personal life as well as their professional life. (yes I work with a ton of Luddites)

Either that, or certain technologies just don't improve their personal life that much. Not everyone needs a PDA, or would glean small enough benefits that the cost and learning time aren't worth it. When Palm became a semi-household name a few years back, we were all caught up in the excitement of the internet and 'information age'. Back then it wasn't hard to imagine everyone having a connected PDA in the future, talking to relatives in Europe or ordering dog food from Pets.com. But much of that passed. So the PDA market reached 'maturity' a lot sooner than people thought- we thought we were still in early adopter phase when we were already perhaps reaching maturity...

Another factor is that as power increases, the features of one form factor move on to the next form factor. Contacts, addresses, to do's? Now you can do it on even a semi-smart cell phone. And if that's what most people wanted out of PDA's, then sales will be affected.

OTOH, think of what you can now do on a PDA. Spreadsheets, word processing, internet, email, name your app. Your basically getting what took a $2000 notebook computer a few years back. So there will always be people who will want those new features, and will thus buy a PDA instead of just using their cell phone.

I do use these features, so can't replace them with a cell phone (a cell phone-sized cell phone, not some bastardized Frankenstein creature that compromises both the phone and the PDA). My cell phone and T3 are small enough that carrying 2 devices is not such a horrible thing.

In a sense, you could really think of cell phones and PDA's as 2 very differently specialized form factors in the same broad category- information products that fit in your pocket. Look at the Treo 600- what is that? Maybe if we (mainly the mainstream press) stop thinking in terms of "PDA's vs. cell phones", we'll do a better job of imagining new future devices.

[Kati Compton]

I think there would be more "upgrading" of PDAs if there was really something "new" to buy

I think thats the problem. They aren't attracting "new" buyers.
Actually, I was suggesting that they're not attracting repeat buyers at the rate they want. The new buyers are also probably an issue, but I could see getting a new PDA every year or year and a half for $300 if each one was a significant step from the previous one.

[Jonathon Watkins]

..... I can't justify ditching my Axim for it. There just isn't enough that's new about it.

Now, if there were a VGA clamshell PPC? Then I'd be buying.

You and me both Kati, you and me both. :|

I'm holding out for VGA next. Till then, the Axim does just fine. No reason to upgrade really. But I have gotten first time PDA users to buy them - the ability to cary your documents & email everywhere is a very powerfull magnet for some people.