Drop In The Tablet Sales Growth In 2014 – 2015 Worries Manufactures, Smartphone Develops Confidence

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Where on one hand, smartphone companies are jotting down their line of strategies to compete in the tablet market, Gartner is out with its Q3 results which may upset the decision-making bodies in the company boardrooms. The report estimates that Tablet worldwide sales will reach a figure of 229 million, a 9.5 percent of the total worldwide sales of devices in 2014. This accounts for an 11 percent increase from 207 million tablet units sold during the same quarter in 2013, but its a very dismal figure when compared to 2013 when tablet sales grew 55 percent.

As far as the worldwide combined shipment of devices are concerned, it is expected for them to touch 2.4 billion ending this year. There is a fair increase of 3.2 percent from the previous year. With other segments showing a modest increase, traditional PCs suffered loss with shipment dipping to 276 million this year compared to 296 million in 2013.

Alternate Devices and Lifetime Extension To 3 Years Bring Tablet Market Gain Down

The reason for gloominess in the tablet market lies somewhere behind the choices of the buyers. New hardware device purchasers are turning to other alternatives like hybrid devicesThis has contributed to the increased share of the ultramobile premium market to 22 percent in 2014, and 32 percent by 2018. Also, the existing users are well aware about the lifetime extension of current tablets to three years by 2018. They are happy upgrading their devices with new software rather than spending on a completely new device. The loss is omnipresent in the marketAs per the projection, number of new tablet purchasers were reduced by 90 million. Even the ones who sought replacement were down the mark by 155 million through 2018. The ones looking out for replacement are preferring hybrid or two-in-one devices over another tablet. Previously, IDC too had predicted the growth to be 19.3% in 2014 as compared to 51.6% in 2013.

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Apple and Samsung are losing its market share due to the rise of local vendors. Apple is still optimistic of its stable earnings from its IBM partnership, but that does not relieve it of the bitter truth of its falling share in tablet market. The dip in Apple’s share were anticipated long backSome would call it a win-win for the Samsung but it too could not steer the customers in its own way at the expense of Apple’s loss. Where Apple’s iPad shipment dipped by 1.3 millionSamsung gained 100,000 units which is not quite a gain. Both have slipped down in the market. This industry shakedown has also been highly affected by dismal performance by other tablet manufacturers who have shown a similar loss in market shares.

With 52% Projected Growth, Smartphones Continue To Lure

The most promising sector once again turned out to be the smartphones. It is backed by the popularity of homegrown and strong sales of lower-end smartphones. With a projected growth of 52% of basic smartphones, they are likely to be highest revenue generators. Utility smartphone units too share the profit status with their share doubling in the market.

As per Robert Cozza, research director at Gartner, “The market is clearly favoring those vendors offering value in lower-priced smartphones. This trend has become more apparent, especially in the second quarter of 2014 when most of the top Chinese smartphone vendors grew volume and market share”

With an estimated  71 percent of global market sharesmartphone market has lured one and all. The increase is up 17 percentage points from 2013. Even among these smartphones, low prices-below $200, are a hit especially in lower economies.

smartphone-user-penetration-APAC-2014-2018

The highest penetration of these smartphones has been in Asia-Pacific region. Of the estimated 1.2 billion mark of global smartphone shipment, growth would lie in developing countries like China, India, South-East Asia etc. With millions of these smartphones being churned out every year, the OS too gets to deserve attention.

Android Rules Over iOS; Emerging Market Makes It More Popular

worldwide device shipments by OS mature market 2014 2015

Be it the mature or the emerging market, Android has a very stable hand. It can be observed from the figure that shipment of Android devices in emerging markets is way too high when compared to the matured markets. In matured markets the shipment of Android devices is expected to cross 313 million in 2014 when compared to 167 million device shipments of Apple. However, in emerging markets Android stood at whooping 928 million, way ahead of 95 million of iOS device shipments. The stats showed similar pattern the year beforeWe have previously analyzed this trend. Android with its free to use platform has encouraged other OEMs to bring out devices at jaw dropping prices. Competition from Chinese and homegrown devices are already giving tough competition to established big-guns. China’s white box vendors are already eying this growing market. In lower economies, it is the brand and the price that are primary factors in a smartphone’s popularity and Android leads the show.

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worldwide device shipment emerging markets 2014 2015

Apple has been long known to cater to the premium market. Though it lags in shipment figures, it continues to boast of its leadership in the revenue market by targeting the high-end device users. iPhone 6 and iPhone 6 Plus had created buzz prior to their launch and with its loyal fan-base it is not willing to give up the its lead position in the market.

With such a complex relationship between the existing devices and platforms, it will be worth watching the state of these markets in the months to come. The demand of large screen devices is already on high but limited to industrialized countries. Tablet market is already on a downside. App developers, advertisers and industry analysts should be attentively looking after this changing market preference to plan out their next move.

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