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PC makers are looking to smartphones

Different market could prove problematic
Tue Oct 27 2009, 17:29

PC MAKERS are increasingly looking to the mobile market to help bolster flagging revenues, according to analyst firm Gartner.

The mobile phone market already dwarfs that of PCs, but Gartner reckons that by the end of the year worldwide smartphone sales will have grown by 29 per cent year-over-year to reach 180 million units, overtaking notebooks in total unit terms.

This is only expected to continue, with smartphones expected to account for about 37 per cent of global handset sales by 2012, up from the 14 per cent stake they currently hold.

As a result smartphone revenue is forecast to reach $191 million by 2012, higher than end user spending on mobile PCs.

Some companies, such as HP, have been periodically dipping their toe into the PDA and smartphone market, and we've seen this trend accelerate in recent months, with Acer, Asus and Toshiba all launching their own smartphones. Although rumours of a Dell smartphone have surfaced from time to time, there are a few notable exceptions, like Lenovo, that have shown no inclination to develop a smartphone.

Although this makes the case for the move into this arena a fairly obvious one, it's not going to be a simple transition, according to the report.

Gartner reckons that, excluding Apple, PC vendors with their own smartphones collectively own less than one percent of the market. Even with a concerted push, Gartner doesn't think any single PC vendor will hold more than two per cent of the smartphone market during the next three years.

"PC vendors should realise that while convergence of technologies offers an opportunity to enter into the smartphone arena, the business models, go to market and positioning of products is very different from the PC market," said Roberta Cozza, principal research analyst at Gartner.

"PC vendors will find it difficult to simply use existing supply chains and channels to expand their presence in the smartphone market. The smartphone and notebook markets are governed by different rules when it comes to successfully marketing and selling products."

Cozza points out that most of these devices have been based on Windows Mobile, but if these vendors are hoping to catch the eye of the consumer they'll almost certainly have to ditch the corporate look and feel of the phone and the operating system.

The way people think about their mobile phone is very different from how they look at their PCs. In general, specifications are less important, brand and user experience are significant differentiators and uptake is driven by users rather than by IT managers.

Cozza concluded that not only are these PC vendors going to have a hard time adjusting their development and business models to this different market, but taking share from the existing, entrenched mobile giants is going to be a tall order. However Apple has certainly proven that the task is not impossible. µ


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