For more information, contact:

Cheryl Cadden, Marketing Coordinator
Phone: 480-609-4540; Email: cheryl.cadden@reedbusiness.com

Smartphone Market Growing Rapidly Despite Major Challenges

SCOTTSDALE, Ariz., January 24, 2006 - Year-to-year growth in the Smartphone market in 2005 will exceed 70%, and will continue to grow robustly for the next several years, reports In-Stat (http://www.in-stat.com). There is a risk, however, that these devices will be seen by consumers as just very expensive feature phones, the high-tech market research firm says. A major problem is that many users do not download applications that make the devices more useful after they leave the store.

“The market’s growth will involve major shifts in share among the OS platforms,” says Bill Hughes, In-Stat analyst. “The winners will be Microsoft and Linux. Their growth will be at the expense of Research In Motion (RIM) and PalmSource, although these organizations will continue to see their numbers grow.”

A recent report by In-Stat found the following:

• The median number of applications that Smartphone users have downloaded is only one, and the ownership of PDAs, the devices that Smartphones are meant to displace, is twice that for Smartphone users as non-users.
  
• Consumers, as well as the industry, still lack a clear definition of “Smartphone.”
  
• Many wireless organizations are wary of Microsoft’s intentions with Windows Mobile.  Microsoft is working to overcome the reluctance by the wireless industry by integrating the delivery of content to Windows Mobile-based Smartphones with its server software.

Recent In-Stat research, The Smartphone OS Wars (#IN0502112WH), covers the global market for Smartphones. It includes worldwide unit shipment forecasts by OS through 2009. It also contains results of a user survey of Smartphone users in North America with data on user preferences for features and OS. The report explores market barriers and drivers along with trends that will influence future development of the market.

For more information, contact:

Bill Hughes, Principal Analyst
Phone: 425 450-9917
Email: bill.hughes@reedbusiness.com

Cheryl Cadden, Marketing Coordinator
Phone: 480-609-4540
Email: cheryl.cadden@reedbusiness.com

About In-Stat

In-Stat’s market intelligence combines technical, market and end-user research and database models to analyze the Mobile Internet and Digital Entertainment ecosystems. Our insights are derived from a deep understanding of technology impacts, nearly 30 years of history in research and consulting, and direct relationships with leading players in each of our core markets. In-Stat provides its research through reports, annual subscriptions, consulting and advisory services to inform critical decisions. Technology vendors, equipment manufacturers, service providers and media companies worldwide rely on In-Stat to support critical business, product and technology decisions.