Sales of handheld Web devices take off in Asia

The finding is contained in IDC's Asia/Pacific (excluding Japan) Smart Handheld Device Report. Contributing to the growth has been the influx of local vendors in Korea and the PRC, offering considerably lower prices than international brands, which has made handheld devices affordable to a wider audience.

Shipments are expected to reach more than 20 million units by 2005, making the Asia/Pacific region (excluding Japan) one of the largest and most dynamic regions for handheld devices in the world.

"The year 2000 has been the year of awakening for the handheld market in Asia. Asian consumers' fascination with sleek and small electronic devices has transformed the handheld companion market from the early adopter domain to one of the mass market appeal," notes Cynthia Lim, senior analyst of personal systems with IDC.

"We see China as the region's growth catalyst and the hot spot as every player vies for a share of this burgeoning market."

Within a span of two years, opportunities in the market have resulted in a doubling of the number of vendors in the marketplace.

Local Chinese vendors now occupy five out of the top 10 vendor positions in the handheld companion category in Asia/Pacific (excluding Japan), with vendors such as Hi-Tech Wealth, Minren and Legend accounting for more than 40 percent of the region's total handheld companion shipments.

The only multinational vendor to break this Chinese tripartite was Palm, according to IDC. The vendor maintained its lead in most of the markets in the region, generating growth in excess of 100 percent, with the exception of PRC where it currently has no appointed distributors.

IDC's report represents IDC's latest findings of the handheld companion and smart phone market in 2000. The study was conducted in Australia, Hong Kong, Korea, Malaysia, the PRC and Singapore. The PC companion segment continued to be squeezed into a smaller niche as cheaper personal companions and ultra-thin notebooks left little room for this form factor to gain a wider appeal, IDC says.

While there are growth opportunities, these will be limited to certain vertical markets. Overall, local vendors in China and Korea made up about 65 percent of the total personal companion market in both 1999 and 2000, with their lower price points and strong local language offerings supporting their market standing.

Outside of these two countries, multinational vendors such as Palm, Casio, IBM, HP and Compaq dominated, showing impressive growth rates from 1999.

While businesses represent a significant market opportunity, most devices have typically been sold to enterprise clients through the enterprise "back-door" instead of corporate channels. However, the market has seen a shift as employers seek to integrate the use of handheld devices into the corporate network.

Although personal information management (PIM) represents the key reason for purchase today, the interest for wireless access continues to grow. The future of this market will lie very much with the value proposition of the device as a wireless communications tool.