PalmOne to focus on smartphones in 2005

The Chilean unit of US handheld computer manufacturer PalmOne (Nasdaq: PLMO) plans to focus this year in the sale of smartphones, in order to increase sales by 25-30% compared to 2004, the company marketing and sales manager Beatriz Rodríguez told BNamericas. "PDAs are still the most important element in our sales, with nearly 75% of total sales, while smartphones only represent 25% of sales, but mainly because we just started selling this technology in 2004," Rodríguez said. Last year, PalmOne started selling its smartphones through local operators, but this year it began selling its products directly through retail stores, which should increase sales. This year the company will focus sales in two different product lines, one of which will be launched next April 4. "Unlike the rest of Latin America, the Chilean market is showing plenty of interest in these devices, as reflected by the sales. People believe in our brand and our products and are willing to pay for it. However, there is still a large percentage of users who would rather keep their cell phone and PDA separate," she added. For those users, PalmOne has also developed new products to be launched mid-April. "Palm is leader in the PDA market and we want to maintain that ranking. It is not our idea to reach leadership in the smartphone segment and abandon PDAs, we want to reach the same levels in both markets and that is why we will always have different alternatives," she said. During the third quarter of PalmOne's fiscal 2004, which ended February 25 this year, the company delivered 144,377 PDAs in the region, while its two closest competitors sold 21,181 units across all Latin America. PalmOne thus ended the year with a market share of 85.3% in Latin America. Mexico, Argentina and Chile do most to boost the company's sales in Latin America, although Colombia is showing positive signs of growth, according to Rodríguez.