Sony Exits U.S. Handheld Market

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Today Sony announced that it will no longer develop and sell Clie handheld models to the United States market, at least for the foreseeable future. However, it also stated that it remains strongly committed to wireless mobile devices, including cellphones and communicators manufactured under both the Sony and Sony Ericsson brands and its PlayStation Portable (PSP) handheld gaming device.

While Sony claims that it is simply reassessing the conventional PDA market and will continue to manufacture Clie models for the Japanese market, several industry insiders had recently predicted that there would soon be dramatic attrition among the ranks of the handheld manufacturers, primarily due to flat overall sales in handhelds for the past two years. (See the Brighthand article Will the Handheld Market Soon be a Two-horse Race?.)

According to Dave Limp, Senior VP of Corporate and Businesss Development at PalmSource, Sony’s decision came as no surprise. “While we are disappointed to see Sony exit the space,” Mr. Limp said. “We respect its decision and hope to continue to work together in the future.”

Mr. Limp told Brighthand that this simply continues the trend toward consolidation of marketshare in the traditional PDA business to two major players, HP in the Pocket PC arena and palmOne in the Palm OS arena. “The market is in transition from a standalone PDA market to a wireless communicator market,” said Mr. Limp. When asked whether Sony would be releasing a Palm OS-based communicator in the future, Mr. Limp said “there are no guarantees in this world.”

Clie TH55 Sony entered the handheld market in 2000 with the release of its Clie PEG-S300 handheld, a thin, lightweight competitor to the popular Palm V handheld. Although critics called the device “underwhelming” for its lack of multimedia (something expected from the entertainment giant) and its plain design, it still managed to grab a sizeable portion of the market. Over the next three years Sony released nearly twenty different Clie models, breaking new ground in the area of design with its innovate NR and UX series. In early 2004 it released its final U.S. model, the Clie TH55.

Sony will continue to support all current customers worldwide for the life of the warranties on their handhelds.



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