Worldwide shipments of hand-held computers climbed 18 percent to 13.1 million last year as rivals gained market share on leader Palm Inc, researcher Dataquest Inc said.
Palm shipped 5.06 million units last year, a 9.5 percent drop from 2000. The electronic-organizer maker's market share fell to 39 percent from 50 percent, Dataquest said.
Compaq Computer Corp almost tripled shipments of its iPaq devices to 1.28 million as its market share more than doubled to 9.8 percent.
Palm, whose computers run on the company's own operating system software, built too much inventory in the middle of last year and was late in shipping some new devices. Handspring Inc, the second-biggest hand-held maker, had a 20 percent shipment increase to 1.65 million units. Handspring's devices run on Palm's software, while those from No. 3 Compaq and Hewlett-Packard Co are powered by Microsoft Corp's software.
Hewlett-Packard, ranked fourth, increased its shipments by 61 percent to 711,000 units.
Hand-held computers running on Palm's operating system had 57 percent of the worldwide market last year, while Microsoft's operating system had 21 percent, up from 11 percent in 2000, San Jose, California-based Dataquest said.
The Microsoft-based hand-helds target the higher end of the market, costing more than US$400, said Dataquest analyst Todd Kort.
Vendors using Microsoft's system "are the only ones making decent profits in the market today," said Kort.
Palm's loss of market share was expected because it was so dominant a couple of years ago, Kort said. He said Palm might rebound from a string of quarterly losses because the company has cut expenses.
"Their platform is still 57 percent of the market," he said. "They're not doing too badly. There is a chance they could recover from the depths of despair last summer."
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