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Gartner: PDAs getting cheaper to buy, manage

As more businesses purchase personal digital assistants (PDAs) for their employees, costs are starting to come down. According to research from Stamford, Conn.-based research firm Gartner Inc., the two-year total cost of ownership for a PDA has dropped from $2,700 in 1999 to $1,946 in 2004.

What's behind the drop in costs? How can a business spend less on mobile devices over their lifetime? caught up with Phillip Redman, Gartner's research vice president, to find some answers.

Is this downward cost trend going to continue?
As devices decrease in cost -- costs like design and manufacturing and memory come down -- processors become more powerful and features inevitably increase. Batteries are more powerful, displays get better. Most manufacturers want to drive prices down and, at the same time, add new functions. The good news is that if you wait two years, you can buy today's $500 device for under $200. But there will always be advances and new features. Companies today just need to choose what kinds of functions they need and then invest.


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Camera phones: snapping at workplace privacy? Are any particular operating systems providing better total cost of ownership?
We did a study in 1999, and then there was a bit of difference. We found that the Windows platform was about $300 more than Palm. Today, we don't see that as much. Palm and Windows devices cover the spectrum of cost. Palm devices now can be more expensive and Pocket PC devices can be less expensive. There is little difference in the cost between the two. What are the key factors that can help bring PDA total cost of ownership (TCO) down?
One is standardizing on a platform. My advice is not to worry about the device, just make sure that going forward you standardize on Palm or Microsoft because it is very expensive to manage a mixed architecture. It is also important to employ mobile management tools for things like application upgrades. Businesses should also have policies in place that spell out who gets PDAs, how they should be used and what information can and cannot be kept on the devices. What mistakes do business often make that can increase costs?
One of the most costly mistakes is to support a user's own equipment rather than having an IT department do the purchasing. Prices are higher and individual devices are harder to support. If the IT department purchases the devices, they will get a better price, and can employ tools to help with management. Returns and repairs will also be easier to manage. Also, it is important to not bite off too much. Handhelds should not be considered replacements for laptops; they are meant to complement each other, so don't expect too much functionality. In your report, you list capital costs as only 20% of the total cost of a PDA. Is that common for other technologies as well?
It is harder to manage a PDA than a notebook or a PC. With [computers], the hardware cost is a large percentage of the total cost. Overall, the cost of managing PDAs is small because the number of PDAs in a business is small, but over time it is going to take more support, and businesses need to be prepared. Businesses may look at a phone where the hardware cost is three-quarters of the total cost and think a PDA is similar, but it is not; it is much more complex.

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