PC vendors eye smartphone market: Report

Personal computer (PC) vendors are eyeing the booming smartphone market to offset a slump in computer sales, according to Gartner, Inc, an information technology research and advisory company. Worldwide, smartphone sales will grow 29 per cent year-over-year to reach 180 million units in 2009, overtaking notebooks in their total unit terms, says the report.

Presently, smartphones account for 14 per cent of the overall mobile device sales, but Gartner expects that by 2012 they will make up around 37 per cent of global handset sales. Smartphone revenue is forecast to reach $191 million by 2012, higher than end-user spending on mobile PCs, which is forecast to reach $152 million in 2012. From 2009, user spending on smartphones will start to surpass the forecast for consumer notebooks.

According to Gartner research, PC vendors’ cumulative share (Apple excluded) of the smartphone market has been static at less than 1 per cent for years. By the end of 2009, Gartner expects that all major PC vendors would have announced their aim to have a presence in the smartphone market. However, Gartner does not expect the share of any single PC vendor to rise above 2 per cent in the smartphone market during the next three years.

Roberta Cozza, principal research analyst at Gartner, said as mobile PCs and smartphone capabilities converge, smartphones will increasingly represent a market opportunity that most PC vendors feel they cannot afford to ignore, but they will face tough challenges.

“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 Cozza. “PC vendors will find it difficult to simply use the 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,” she said.

PC vendors have traditionally introduced smartphones based on the Windows Mobile platform, which have mainly attracted business users. PC vendors will face challenges in having to adapt and base their smartphone offerings on a consumer-focused value proposition, largely based on short life cycles, fashion design, hardware and software platform diversity, says the report.

“The smartphone market has never been more competitive and even established handset vendors are being challenged to maintain or expand their positions. PC vendors will be challenged to stand out from the crowd and be successful unless they produce truly differentiated and unique products,” said Cozza.