Shipments of handheld PCs are expected to increase 60 percent this year, but will start to fade in subsequent years, according to In-Stat, a market research firm.
The market's growth stems largely from localized versions of operating systems and new features such as color screens, according to the study, "Handheld PC Market: Niche for Now." Regional versions will help the market expand in areas such as Europe and Japan, the company said.
Microsoft Corp.'s Windows CE also deserves credit for the increasing size of the handheld PC market, with shipments surpassing 1 million units last year, In-Stat said. The stability offered by Windows CE, which appeared last year, brought new vendors such as Philips Electronics Inc., Compaq Computer Corp. and NEC Corp. into the market, according to In-Stat.
In-Stat defines a handheld PC as a general-purpose computing device that offers word-processing, spreadsheet and other capabilities.
Windows CE is being used by one-third of companies, according to a related report by In-Stat's sister company, BRG. Although almost two-thirds of the companies surveyed expect to use the operating system more in the next two years, widespread adoption will be slow, BRG said.
Handheld PCs will face competition in 1998 from several devices, including Microsoft's Palm PC, which will present a familiar Windows look in a palm companion form when it ships this quarter, In-Stat said. A larger device with a new version of Windows CE will edge into the market later this year, the company said.
By 1999, it predicts that handheld PC market growth will subside to 30 percent due to competition from palm companion and mininotebook devices. Shipment growth is expected to continue to decline through 2002, according to In-Stat.
Based in Scottsdale, Arizona, In-Stat can be reached http://www.instat.com/.