Smart phones to beat handheld computer growth: IDC

FRAMINGHAM: Global shipments of handheld computers are expected to soar over

the next three years, according to a study that said sales would be spurred by

growth of mobile phones that also play music and store databases of a user's

contacts.

The worldwide market for the gadgets will grow to over 63.4 million by 2004

from 12.9 million units in 2000, research firm IDC said on Monday. Such a swell

in shipments of these "Smart Handheld Devices," such as personal

digital assistants (PDA) and two-way pagers, will create opportunity worth more

than $26 billion, IDC says.

"Technological progress, particularly in mobile multimedia and wireless

areas, will continue at a rapid pace, and 2001 will prove to be the year when

mobile access devices hit their stride," said Kevin Burden, manager for

IDC's Smart Handheld Devices research program.

According to IDC, "smart" phones, boasting color screens, contact

databases and the ability to play music and videos, will be the fastest growing

segment, at a annual rate of about 164 per cent to over 23 million units by

2004. They may nibble at the PDA market, which is dominated by Palm Inc.

Last week, Microsoft Corp. said it planned this year to launch a software,

code named Stinger, aimed at setting the standard for multimedia-enabled phones.

It is working in conjunction with mobile phone makers Samsung, Mitsubishi and

Britain's Sendo. Psion Plc-owned Symbian is working on smart phone software, as

are Palm and Japan's NTT DoCoMo.

Separately, IDC also said that expectations of explosive growth in the next

generation of mobile phone handsets has spurred expansion in the market for the

chips that will serve as their brains. According to IDC, worldwide digital

handset semiconductor revenues will increase to over $38 billion in 2004 from

about $17 billion in 1999, an annual growth rate of 18 per cent. Handset

shipments will post a healthy 24 annual growth rate during this same period to

reach over 780 million units in 2004.

"Third-generation handsets...will have a stronger impact beyond 2003,

especially as new features drive more logic and memory content to support higher

bandwidth communications and multimedia computing," IDC said.

(C) Reuters Limited 2001.