Smartphone Market Growing Rapidly Despite Major Challenges

In-Stat: Year-to-year growth in the Smartphone market in 2005 will exceed 70%, and will continue to grow robustly for the next several years. There is a risk, however, that these devices will be seen by consumers as just very expensive feature phones. A major problem is that many users do not download applications that make the devices more useful after they leave the store. The market’s growth will involve major shifts in share among the OS platforms. The winners will be Microsoft and Linux. Their growth will be at the expense of Research In Motion (RIM) and PalmSource, although these organizations will continue to see their numbers grow.

• The median number of applications that Smartphone users have downloaded is only one, and the ownership of PDAs, the devices that Smartphones are meant to displace, is twice that for Smartphone users as non-users.

• Consumers, as well as the industry, still lack a clear definition of Smartphone.

• Many wireless organizations are wary of Microsoft’s intentions with Windows Mobile. Microsoft is working to overcome the reluctance by the wireless industry by integrating the delivery of content to Windows Mobile-based Smartphones with its server software.

The Smartphone OS Wars Publ 20040124