Europe still enjoying strong mobile sales growth

Fuelled by strong demand for Series 60-based smartphones and RIM BlackBerry devices, western European shipments of mobile devices (smartphones and personal digital assistants) grew by 38 per cent during the third quarter of 2004, newly released research has revealed.

According to IDC's latest European Quarterly Handheld Tracker, more than 1.8 million handheld units shipped during the third quarter of 2004, compared to 1.3 million units in the third quarter of 2003.

Despite vendors withdrawing from the market and a slow quarter from palmOne, the standalone PDA market continued to grow, albeit at a modest 4 per cent.

Market highlights included the growing penetration of low-cost Pocket PC vendors - including Yakumo, Medion, Anubis and Mitac - and the high attach rates of in-car navigation global positioning system (GPS) bundles.

"GPS bundling continues to be a key product differentiator for many vendors in Europe, with average attach rates of over 50 per cent," said Geoff Blaber, research analyst for European mobile devices at IDC.

"Both Hewlett Packard and palmOne are now offering consumers maximum flexibility with a range of price points incorporating low, medium, and high cost packages."

The Finnish vendor Nokia remained the European mobile device market leader, with shipments of Symbian-based Series 60 smartphones such as the 7610 helping to drive a growth rate of 44 per cent during the quarter.

Having recently introduced a complete range of devices HP "continues to have the strongest product portfolio in the traditional PDA space", said IDC. On the enterprise side HP remains the only vendor that can offer a complete mobile computing solution. For consumers, the analyst firm expects HP to focus on in-car navigation and multimedia.

According to the study, Sony Ericsson managed to sustain year-on-year momentum, adding the P910 to its smartphone product portfolio with keypad and push email integration. P900 sales continued to comprise over 90 per cent of Sony Ericsson's smartphone sales, with smartphones still comprising below 5 per cent of the company's overall mobile phone mix.

IDC's market research indicated that palmOne had a slow quarter as it focused on clearing the channel to make way for new products in the run-up to the holiday period. The PDA pioneer saw shipments drop by 16 per cent year on year to 138,900 units.

Despite an improved product portfolio, which includes the high-end T5 and Zire GPS bundles, IDC believes that palmOne will continue to struggle during the final quarter of 2004, against strong competition from white-box Pocket PC vendors.

IDC noted that Canadian vendor RIM continued to grow impressively at over 300 per cent year on year, following strong growth in the previous quarter, and managed to secure around 20,000 units of its new Vodafone 7100v BlackBerry despite the device's introduction at the end of the quarter.

"RIM continues to provide the most credible, reliable and secure end-to-end push email solution via new installations of BlackBerry Enterprise Server and close relationships with mobile network operators in Europe, which has seen the vendor maintain a high 'trial-to-adoption' ratio among businesses," said Andrew Brown, program manager for European mobile devices at IDC.

"At the same time the vendor continues to innovate on the device through differentiated new form factors, allowing the vendor to expand its presence into new accounts."