Personal Digital Assistants (PDAs) are not so personal anymore. New-found power and features are helping these devices to become an accepted part of the corporate world. Users are realising that PDAs can be just as useful as desktops, notebooks and cell phones. In days to come, industry analysts expect to see PDAs with features like video compression/ decompression, MP3 playback and 3D graphics, say Gaurav Patra & Shipra Arora

According to Kulbhusan Seth the buying pattern will shift from individuals to corporates, once companies realise that PDAs are as powerful and useful as the desktops, notebook computers and cell phones they already support

According to IDC India, the domestic market for PDAs was 4,000 units in terms of legal shipments in 2001; in the first half of 2002 the market grew to around 6,700 shipments. Though these numbers are small, IDC believes India is going to be one of the leading PDA markets in the APAC region. Vendors have also started realising this, so there is a lot of activity in the Indian market.

Earlier this year, Toshiba entered the Indian PDA market; soon another player, Kaii, is likely to follow. Players like Compaq (now HP) and Casio are already in the market. “We are going to see more vendors entering the market as India is going to be a key outlet for them. Apart from China, it’s India that is going to be the market where opportunities abound. This is because in other APAC markets like Korea and Singapore adoption has already happened to a large extent,” says Paras Tandon, senior analyst for computing products and channel research group at IDC India. According to industry gurus, from 2003 onwards, apart from the Chinese market, volumes are going to come from the Indian market.

The outlook on the Indian market is very positive. As per experts, global PDA shipments rose 17 percent in 2001 over the previous year, and are poised to grow another 18 percent this year. In India, growth has been good not only because of the small base but also because the market holds good potential. IDC estimates the size of the Indian PDA market at around 31,000 units by 2003, with a growth of 70-80 percent in the coming one to two years.

The Indian PDA market can be segmented into three categories:

• Built-in keyboards—are not very popular and account for only 5 percent of the total market.
• Stylus—this pen-based PDA is the most preferred in India, with a current market share of around 85 percent. PDAs in this category cost between Rs 5,800 and Rs 35,000.
• Converged PDAs—which are basically a mobile phone plus a PDA. These account for almost 10 percent of the market, and are priced at around Rs 32,000 and above.

“The maximum growth is happening at the entry-level, but a lot of movement is also taking place at the mid-level, with companies buying to automate their sales force. When they do this they look at the price, and hence mid-level PDAs are popular for sales force automation,” says Tandon. He however feels that by 2005-2006 converged PDAs will be the driving force, and will give a tough time to pen-based PDAs.

Says Kulbhusan Seth, chief marketing manager at Casio India, “The Indian PDA market definitely has the potential to grow. Awareness about PDAs is increasing and people are running more and more applications on these devices. I believe that right now the market is there only for lower-end PDAs. But in the days to come the demand for high-end products will grow.”

Agreeing with Seth’s view, Jyotin Verma, the country head for marketing at HCL Infosystems’ Frontline division said, “There has been tremendous growth in the overall PDA market in the last one year. However, most of the growth has been driven by the entry-level, which has experienced the maximum growth in the PDA market in India.”

Market drivers
Key drivers in boosting sales include more robust devices, lower prices, more reliable applications, and more communication networks. Worldwide, increased use of short-range wireless technologies like Bluetooth, has helped to increase sales of PDAs, a trend which is expected to be repeated in India.

One of the most significant influences on PDA sales is growing acceptance in the corporate segment. An increasing number of businesses are considering PDA bulk purchases for distribution among employees, much the way notebook computers are deployed, currently. “There is growing recognition by American corporations that there has to be some sort of deployment strategy for PDAs,” says Seth.

At present, many people buy PDAs on their own, then bring them into the corporate environment by syncing them to applications on the desktop. This will change as companies realise that PDAs are as powerful and useful as the desktops, notebook computers and cell phones they already support.

As the Indian market evolves and begins to grow, PDA vendors will start targeting the market in a more focused manner. At present, since the market is nascent and has just started evolving, vendors do not have a clear-cut positioning strategy. They are offering PDAs as a solution to increase the efficiency of salesmen and the overall processes of enterprises. “They (vendors) are positioning it as a productivity tool, as something which can help the bottom line. This can be one of the positioning strategies, but it is not ‘the’ positioning strategy,” feels Tandon. Adds Seth, “Currently, vendors are in a situation where they are trying to evolve their strategies. Some of the vendors have started developing India-specific applications.”

PDAs are currently more of a high-end consumer product (CEOs, CIOs, top management — who buy it for personal use). As prices go down the PDA will become a mass market product—but this won’t happen very soon—as existing prices are still too high. Though prices have fallen in the last one year, the drop hasn’t been substantial. Even over the next year prices are likely to go down only by 4-10 percent, since the addition of features like Bluetooth will add to costs. Agrees Seth, “In a price-sensitive market like India, pricing is definitely a key factor which will influence PDA sales.”

“The hardware capabilities will go up with gradations happening. What we will see is that instead of prices going down there will be an increase in offerings at the same price,” predicts Verma. He says that the product by itself is not very strong, and is sold more on its applications and usage patterns. Software development is the most critical factor in this segment. “The factors which are going to drive growth in future are applications and prices. After certain basic hardware configurations are met, software integration starts becoming the differentiating factor,” Verma points out.

“In a market like India, price is always considered an important factor. At the same time, features of these devices are going to play a critical role,” says Tandon. While price and characteristics of the device itself (display quality, size, weight, battery life) are going to be factors driving the consumer market, for enterprises and the commercial sales market it will be software applications that will influence the purchase decision.

Paras tandon says that since the PDA market is still in a nascent stage, vendors are not very clear about their positioning and so are currently positioning the PDA as a productivity tool which can help the bottom line

India-specific
The applications—both consumer and commercial—have to be right. Developing India-specific applications and local language integration will help in driving the market.

“Currently, the largest sales of PDAs are happening in China, where vendors have developed and integrated local language and local level of applications. In the near future we are going to see vendors incorporating Hindi applications on this device,” says Verma. Other experts feel there will not be much activity involving other regional languages at least for the next two years.

There has to be education and awareness created by vendors depending on whether the product is going into the consumer or commercial segment. For instance, when addressing commercial users, vendors can highlight the fact that PDA applications can do more than just keeping and storing information. This can create awareness about possible applications like calculating premiums (for insurance agents).

Industry experts believe that some of the emerging technology trends which currently have niche markets, but do have the potential to become standards in the near future are wireless, Bluetooth, MP3, multiple options to log on to the Internet, voice recognition capability, watching video files, connecting multiple devices, 3-D graphics and the Linux operating system.

Applications being developed in the PDA space depend upon the companies’ requirements. There are industry-specific applications being developed; for instance, applications for an FMCG sales force, for insurance agents, the police, the Indian military, and for e-governance. However, the applications have to be simple and effective. The killer lies in bundling the software. A salesman capturing information during a sales call has to complete all information, then and there, in a short span of time. Hence it is very important for the applications to be simple and effective.

Sales have started increasing in the commercial market as well. The major verticals in which there is demand are insurance, healthcare, IT and FMCG for automating the sales force. The commercial market is basically mass deployment of around 100 units in a particular organisation. More and more companies are identifying their top-notch sales people and providing them with PDAs so that their productivity increases.

“The corporate segment, which is right now 20 percent of the total PDA market, will grow in the next one to two years. It will eat into the entry-level, as the acceptability and awareness level of the product grows,” states Verma. E-governance is another segment which has tremendous potential. Casio recently bagged an order from the Andhra Pradesh education department to connect all the rural schools of the state.

As buying power shifts from individual to corporate buyers, it is integration with the server rather than the desktop that matters most. For companies which want to provide employees with mobile or wireless e-mail access, it’s integration with the existing applications that will matter most. For example, for enterprise applications that use PDAs as remote clients, it’s necessary to invoke business logic in J2EE application servers and .NET servers, synchronise with relational databases, integrate with enterprise resource planning and customer-relationship management systems, access legacy systems of all kinds, and, in future, access Web services. PDAs are also going to play an important role in a wireless environment.

The market for PDAs in India is currently nascent, as prices are still on the higher side. It is difficult to say when these devices are going to become mass market products. Fact is, PDAs are already powerful in terms of process capabilities. With future technical enhancements, PDAs could one day become as powerful and essential as desktops are at present.