Smartphone sales in Europe will overtake those of PDAs for the first time this year, according to a report by market analyst Canalys.
The report suggests that 3.3 million smartphones will be sold this year, compared to 2.8 million handheld devices.
But the report warns PDA manufacturers not to try and cross over into the smartphone market by producing hybrid models. They should concentrate instead on connectivity.
"Smartphone shipments will be an order of magnitude greater in 2003 than 2002," said Andy Buss, senior analyst at Canalys.
"If PDA manufacturers want a bigger slice of the pie they should concentrate on Bluetooth. Vendors should only launch wireless handhelds if they can differentiate themselves from the devices already out there."
The report indicated that in the long term smartphones will overtake PDAs as data storage devices for most people, although those who need large screens will still use PDAs.
However, PalmSource, formerly the software division of Palm, disagreed with the findings and has licensed its operating system to 17 device manufacturers.
"We've got an ultra-compact operating system and the market needs diversity," claimed Jean-Marc Holder, director of marketing at PalmSource.
"Microsoft approached the market for smartphones with a PC operating system that it is going to port if it kills them.
"[For companies that don't want Microsoft] Symbian is a 'what are we going to do about Microsoft' choice."
PalmSource is also targeting retail outlets with its 'beam-me-app' programme. This involves dealers having application servers in shops that allow users to beam new applications directly into their handheld device.
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