Worldwide shipments of PDAs using Microsoft's Windows CE operating system have surpassed those using PalmSource's Palm OS for the first time, according to Gartner.

The shift follows a precipitous decline in Palm OS PDA shipments in the third quarter of 2004, according to research released by the industry analyst company.

With just under 1.4m Windows CE devices sold during the quarter, Microsoft held 48.1 percent of the market, up from 41.2 percent a year earlier.

Palm OS shipments were down 28 percent, dropping from approximately 1.2m to 850,000 when compared year over year. The market share of Palm OS dropped from 46.9 percent to 29.8 percent, Gartner says in a statement.

PalmOne continued to be the top device vendor, but its market share has dropped from 34 percent to 26 percent in the last year. The company shipped 864,000 PDAs in the third quarter of 2003 and 749,000 during the same period of 2004, according to Gartner.

The research company says it had been expecting a decline in Palm OS shipments, but not one of this magnitude.

The total PDA market was up 13 percent from last year's numbers, with 2.9m units shipped during the quarter.

Gartner's PDA numbers did not include smart phones such as PalmOne's Treo 600, the statement says.