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SCMP Reporter

The slumping hand-held market was boosted by Christmas shopping, with Sony's Clie series reported as the top seller in Hong Kong.

After a dramatic decrease in demand for Palm OS-based devices in the first half of the year, the market picked up again this month, believed to be the peak season for sales of consumer devices.

'December is typically the fastest month to move consumer devices such as PDAs [personal digital assistants], so a large [rise] in sales is always expected,' said Manny Lopez, market analyst of personal systems research at International Data Corp.

Shops in Hong Kong said that there had been increasing demand for hand-helds recently, especially for Sony's Clie series.

Since launching the Clie in Hong Kong three months ago, the Japanese electronics giant has dominated sales over rivals Palm and Handspring, according to store owners.

'Sony's PDAs are now the most popular for Hong Kong people. Over 80 per cent of our PDA sales come from Sony,' said Anthony Wong at Smart Asia Computer Co in Wan Chai.

Despite Sony's decision not to meet price cuts by its competitors, the Clie PDA was favoured by gadget-loving Hong Kongers, the company said.

'It has the best resolution. The resolution of N760C is four times better than that of Palm and Visor. It is perfect for entertainment and movies,' said salesman Stanley Ma at SonyStyle Pro Shop in Causeway Bay.

N760C carries a resolution of 320x320 pixels, while Palm's m505 and Handspring's Visor Prism each has a resolution of 160x160.

Mr Ma said the shop could sell up to 15 units of N760C and five to eight of S320 a day and both models were going out of stock.

Broadway Photo Supply at Times Square also said that Sony had the best sales. N760 has been sold out for some time and there is a long waiting list. 'If we had enough stock, about 60 could be sold in a month,' said sales assistant Fanny Cheung.

An assistant at MOC at Wan Chai Computer City said the low-end S320 had the heaviest demand, especially during the holiday shopping season. The shop sold about 10 S320s and five N760s per day.

Thomas Thai visiting from Australia, bought an S320 at the shop as his first PDA because of the 'cool design'.

'It is not that expensive but has good functions,' he said.

Analysts found that Sony's reputation in household appliances had helped the company launch its hand-held products.

'Sony's popular household brand ranks high in the mindshare for quality entertainment products, and has given the vendor a good start in the hand-held business,' Mr Lopez said.

'The Clie is uniquely positioned in the consumer entertainment space with a high-resolution colour screen and built-in MP3 player, which well differentiates it from other Palm OS-based products in the market.'

In fact, shops in Hong Kong found it profitable to sell Sony's other models such as the T415 and the T610, which have not been officially introduced to Hong Kong.

The newly released T415, claimed to be the 'world's thinnest Palm-powered hand-held', just 0.39 of an inch thick, is a combination of a PDA and a remote controller. At about HK$2,300 in the grey market, more than 50 had been sold by MOC this month.

'People are more enthusiastic and willing to buy the new models,' MOC salesman Eric Lee said.

The second-best selling hand-held on the local market was Palm's m505. Its price fell from HK$3,200 to about HK$2,800 recently, and it came with a 16MB Secure Digital memory card and a Hotsync cable.

At MOC, which sold 15 Sony PDAs daily, five m505s were sold on average daily. At Broadway, sales of the m505 had been increasing, especially after the price reduction. It sold up to 40 units per month.

Palm said that its market position had never been threatened, both globally and in Hong Kong. 'According to IDC, we had a local market share of 61.9 per cent last year,' said Cara Liao, Palm marketing manager for North Asia.

'We do not feel Sony is a threat to us as we have very different market positions. We are targeting executive users at all working levels, while Sony aims to provide an entertainment device for personal users.'

IDC found Palm had the Palm OS-supported hand-held market overwhelmingly with an 84.9 per cent share - Handspring had 7.3, IBM 3.7 and Sony 2.5.

Palm's nearest rival, Handspring, has launched another round of promotions to lure Christmas buyers. The company, through PacRim Technologies, its official distributor in Hong Kong, is offering a buy-one-get-one-free promotion - a Visor Edge and a Visor Deluxe at just HK$2,450.

The Hong Kong market is quite different from the global picture. Last month, Gartner Group found that Palm led in the third quarter with a 30 per cent global market share, when Handspring expanded its share from 11 per cent to 14 per cent.

IDC anticipated the Hong Kong hand-held market would have grown 87 per cent from 128,530 units last year to about 234,000 this year.



Store owners say Clie devices are moving like hot cakes but rival maintains its leadership position is secure