Research and Forecast Of Smart Handheld Market

of China 2001-2005

(by Pday Research, August 2002)

It is a huge market with many opportunities and challenges for the Smart Handheld Devices (Smart Handheld Device, shortly as SHD) Market. How about the future of SHD market in China?

This report separates SHDs into three types: Low-end PDAs, High-end PDAs, and smartphones. We review and summarize a great deal of data and charts, such as the average unit price, sales shipment and sales revenue of all kinds of SHDs of China from 1999 to the first half of 2002.

After collect and analyse many facts, we anticipate the general trends such as the average unit price, sales shipment and sales revenue of Low-end PDAs, High-end PDAs, and smartphones from 2002 to 2005.

Low-end PDAs refer to the handheld devices whose main function is the management of personal information. Low-end PDAs are generally supported by few software. The representative products are SMS KING of HTW, ZhiNengWang of Meijin, V88 of GSL, A68 of LEGEND, and so on. Low-end PDAs also include SMS PDA and Bluetooth PDA that expand the functions of mobile phones and assist the use of mobile phones.

High-end PDAs refer to the handheld devices which are supported by variety of software and accessories. They have big memory, strong ability of calculating and communication, adapt to such fields as multimedia application, vertical application and professional uses. The typical products are Palm OS series and Pocket PC series. There is a large room for the development of High-end PDAs.

Smartphones are handheld devices that combine the voice function of mobile phone and the excellent data processing ability of PDAs. For example, Motorola 388, NOKIA 9210, GSL E938, Dopod 686 smartphones and so on.

As shown in Chart 1, the duration of 1999 to 2000 is the first stage of the fast development of Chinese SHD market. 2001-2002 is the adjustment stage. During the course of development and adjustment, some of the old products are gradually out-of-date, and other new ones come to be the leading products of the market. The second stage of fast development would start from 2003.

Chart 1 Shipment Forecast of Chinese SHD Market 1999-2005 (Million units)

Market of Low-end PDA

Wireless connection, colorful models, multimedia, big memory, professional uses and vertical application become the new trend of SHD market. So those SHDs with simple functions, poor memory and monochrome color, will be gradually squeezed out of the market. The sales of the Low-end PDAs decreased quickly in these two years. The market of Low-end PDAs will begin to recover from 2003, because of the fast growing of SMS PDA and Bluetooth PDA.

At the same time, the dramatic decreasing of the average unit price of Low-end PDAs leads to that the annual sales revenue can not reach the climax of 2000 before 2005.

Chart 2 Average Unit Price Trend of Low-end PDA of China 1999－2005 (RMB)

Market of High-end PDA

The development potential of High-end PDA is huge. The base of the market is small, it is difficult to explore (always need to develop variety of software and extended accessories), the investment is big but the return is slow; so the market of Chinese High-end PDA is not satisfactory. As far as the global market of High-end PDA as concerned, it was in the high-speed development stage from 1998 to 2000, in lower speed development stage in 2001 and 2002.

With the gradual decreasing of the cost of hardware, the more and more application software released, and the joining of the heavyweight vendors such as DELL, this market will begin to rise from 2003. It is anticipated that the High-end PDA market in China will reach the annual sales volume of 1.095 million sets till 2005.

Market of Smartphone

The smartphone market is the focus of the SHD market, and also the focus of mobile phone market. In 2001, the annual sales quantity of smartphone accounted for 13.0% of the SHD market; till 2005, the annual sales quantity of smartphone is 16.50 million sets, accounting for 79.2% of the total sales of SHDs.

In 2001, the annual sales revenue of smartphone accounted for 0.84% of the total sales revenue of the mobile phones. Till 2005, the annual sales revenue of smartphone will account for 21.93% of the total sales revenue of the mobile phones.

Other Viewpoint

The gradual improvement of circumstance of wireless network becomes the power of pushing forward the fast development of SHD market.
The share of wireless handheld devices accounting SHD market increases quickly.
The foreign vendors boost the steps into the market of China mainly by means of cooperating or joint stock with the local vendors.
The developments of key components and key technologies
The problems in the process of development of SHDs.