The demand for smartphones is growing, putting increasing pressure on Palm and Research in Motion (News - Alert) to continue to grab more of the market. The smartphone is appealing to more than just the business user, forcing a change in the marketing approach in order to dominate the market.

According to John Moore in a CNBC.com special report, both Palm and RIM are prepared to do battle as Apple and High Tech Computer focusing on consumer-friendly features and design.

Gartner (News - Alert) has forecasted smartphone unit sales to jump 52 percent this year to 190 million units. This amount will account for 15 percent of the total handset market. The market research firm predicts that by 2012, smartphones will account for 65 percent of sales.

Morgan Keegan senior analyst Tavis McCourt told Moore, “I think that within a year, there won’t be a smartphone market. There will only be a handset market. We’re seeing the types of e-mail and connectivity applications typically associated with smartphones across the handset market. Ultimately, we expect traditional handset players getting better at implementing higher-end features.”

 

Nokia (News - Alert) is one that is making waves in the smartphone market. The company is actually considered the world smartphone leader and holds 45 percent market share, according to Gartner. The company recently announced two new N Series smartphones with WiFi (News - Alert), 3G connectivity and advanced camera and multimedia functions.

High Tech Computer, an upstart Taiwan-based manufacturer has gained attention through the sleek, consumer-friendly HTC Touch series. The product’s unique selling point is its touchscreen interface. LG Electronics and Samsung both have launched products this year as they hope to capture part of this growing market.

Palm is certainly known as an early smartphone innovator. The BlackBerry (News - Alert) gained prominence with corporate e-mail users, while the remaining users of smartphones relied on the Treo. Palm has seemed relatively idle the past few years, yet the company is hoping to advance its product offering and operating system with a major turnaround in its Treo Pro.

RIM is taking a different approach and it can – the company is already in a strong position as the No. 1 player in the U.S. smartphone market as it claims 42 percent of the market. The company is fighting off challenges from Apple as it has quickly claimed the No.2 spot. As the iPhone is gaining share and popularity, RIM must continue to work to enhance and expand the BlackBerry platform to maintain its position in the market.

Moore highlighted both the risks and rewards for both Palm and RIM. For RIM, the key is to focus on continued subscriber growth and strong carrier partnerships. Palm has a lot at stake in its turnaround plan and its success depends on the results. At the end of the day, unless Palm is able to maximize its position through its turnaround, it may not be around to compete in the future.

 

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