Gartner Says Microsoft's Windows CE Surpassed Palm OS Shipments in Worldwide PDA Operating Systems Market in Third Quarter of 2004.

STAMFORD, Conn. -- Worldwide personal digital assistant (PDA) shipments exceeded 2.8 million units, as Microsoft Windows CE operating system licensees surpassed the Palm OS for the first time in the third quarter of 2004, according to Gartner, Inc.

The Microsoft Windows CE operating system accounted for 48.1 percent of worldwide PDA shipments in third quarter of 2004. Palm OS units represented 29.8 percent of the market, down from 46.9 percent market share in the same period last year (see Table 1).

"The robust Microsoft Windows CE market has been driven in part by the wide choice of vendors," said Todd Kort, principal analyst in Gartner's Computing Platforms Worldwide group. "Business customers tend to steer clear of markets dominated by a single supplier, which is where the Palm OS market stands today."

"A decline in Palm OS shipments was expected in the third quarter of 2004, but not of this magnitude," Mr. Kort said. "The company is pouring the vast majority of its resources into its smartphone business. A reduction in the number of PDA models palmOne offers is expected in 2005."

Table 1

Preliminary Worldwide PDA Shipment Estimates by Operating System for
3Q04 (Units)
----------------------------------------------------------------------
                                   3Q04                 3Q03
                         3Q04    Market        3Q03    Market   Growth
Company             Shipments   Share(%)  Shipments    Share(%)   (%)
----------------------------------------------------------------------
Windows CE          1,375,866     48.1    1,037,874     41.2     32.6
Palm OS               850,821     29.8    1,181,202     46.9    -28.0
Research In Motion    565,000     19.8      123,775      4.9    356.5
Linux                  24,500      0.9       48,550      1.9    -49.5
Others                 42,620      1.5      125,745      5.0    -66.1
Total               2,858,807    100.0    2,517,146    100.0     13.6
----------------------------------------------------------------------

Note: Totals do not include smartphones such as the Treo 600 or
BlackBerry 7100 but include wireless PDAs such as the iPAQ 6315.

Source: Gartner Dataquest (November 2004)

PalmOne continued to lead the worldwide market in PDA hardware shipments, but its shipments declined 13.3 percent in the third quarter of 2004. PalmOne's market share totaled 26.2 percent, but Hewlett-Packard and Research In Motion showed substantial increases in shipments in the third quarter of 2003 (see Table 2).

Table 2

Preliminary Worldwide PDA Vendor Shipment Estimates for 3Q04 (Units)
----------------------------------------------------------------------
                                  3Q04                  3Q03
                         3Q04    Market        3Q03    Market   Growth
Company             Shipments   Share(%)  Shipments    Share(%)   (%)
----------------------------------------------------------------------
PalmOne               748,950     26.2      863,993     34.3    -13.3
Hewlett-Packard       692,113     24.2      578,500     23.0     19.6
Research In Motion    565,000     19.8      123,775      4.9    356.5
Dell                  185,300      6.5      134,813      5.4     37.4
Symbol Technologies    63,521      2.2       72,690      2.9    -12.6
Others                603,923     21.1      743,375     29.5    -18.8
Total               2,858,807    100.0    2,517,146    100.0     13.6
----------------------------------------------------------------------

Note: Totals do not include smartphones such as the Treo 600 or
BlackBerry 7100 but include wireless PDAs such as the iPAQ 6315.

Source: Gartner Dataquest (November 2004)

"Demand for wireless e-mail continues to increase as the primary driver of new PDA deployments. The shipment growth of Research In Motion nearly balances the decline of Palm OS, Linux, Symbian and proprietary PDAs," Mr. Kort said. "We expect worldwide PDA shipments to total 11.9 million units in 2004, up approximately 4 percent from 2003."

Additional information is available in the Gartner Alert "Windows CE Surpasses Palm OS in 3Q04." The Alert provides preliminary results for the worldwide and U.S. PDA market, as well overall shipments on a regional basis. This document is available on Gartner's Web site at http://www3.gartner.com/DisplayDocument?ref=g_search&id=459718.

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Gartner, Inc. (NYSE: IT and ITB) is the leading provider of research and analysis on the global information technology industry. Gartner serves more than 10,000 clients, including chief information officers and other senior IT executives in corporations and government agencies, as well as technology companies and the investment community. The Company focuses on delivering objective, in-depth analysis and actionable advice to enable clients to make more informed business and technology decisions. The Company's businesses consist of Gartner Intelligence, research and events for IT professionals; Gartner Executive Programs, membership programs and peer networking services; and Gartner Consulting, customized engagements with a specific emphasis on outsourcing and IT management. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, and has more than 3,500 associates, including approximately 1,000 research analysts and consultants, in more than 75 locations worldwide. For more information, visit www.gartner.com.