According to a report by research firm IDC, the worldwide market for handheld devices dropped for the sixth consecutive quarter of year-over-year decline in the second quarter of 2005. According to IDC's Worldwide Handheld QView, device shipments decreased 20.8% compared to the same quarter one year ago and fell 24.9% sequentially in 2Q05 to 1.7 million units.

Despite the continued decline of the handheld market, some manufacturers remain committed to it. Acer and Yakumo have risen to Top 5 shipment levels on strong demand for their GPS solutions for example.

IDC said the definition of handheld device has become blurred with increased competition from mobile phones with multimedia and capabilities.

"As an answer to slowing consumer demand and stiff competition from converged mobile devices, handheld device manufacturers are striving to creating new solutions that leverage the unique hardware and software capabilities of the handheld device to provide users with an experience beyond that of a dedicated device," said Kevin Burden, research manager of IDC's Mobile Devices program. "Discovering and developing these new solutions are essential for driving the handheld device beyond PIM and returning the market to growth."