Worldwide tablet shipments are expected to decline for the second straight year in 2016, dropping 9.6% compared to 2015.
A new International Data Corporation (IDC) Worldwide Quarterly Tablet Tracker report reveals the tablet market in totality has seen its peak and will head for a nosedive in 2016 and 2017.
This trend, according to the report, will be followed by a slight improvement in 2018 and beyond, driven by detachable tablet growth. Currently, the detachable category only accounts for 16% of the market and IDC expects it to reach 31% in 2020.
Tablet life cycles have proven to be more like PCs, which is likely to be somewhere around four years. Tablet manufacturers are slowly shifting focus toward the detachable tablet market segment, which has quickly resulted in increased product offerings, lower average selling prices, and broadened consumer awareness for the category, says IDC.
"Many traditional PC manufacturers have assumed the detachable tablet category to be a natural extension of the PC market and perhaps assumed it would rightfully be theirs to capture. Now they find themselves in head-to-head competition with a slew of new manufacturers that have created their market off of smartphone and slate tablet growth. This brings new channel dynamics and lower prices to a brand new category with an abundance of upside, reveals ICD.
Christopher Riley, CEO of laptop and accessories retailer The Notebook Company, says the tablet market, which blazed a sales trail since its debut in 2010, seems to be 100 million units smaller than expected.
"The heyday of the tablet seems to have passed. While tablet sales accounted for the bulk of The Notebook Company's revenue from 2011-2013, this has tapered off gradually over the last two years. We are now seeing tablet sales account for around 50% of our sales. It is unlikely we will return to the utter buoyancy of 2010-2013," explained Riley.
Global market research firm Trendforce, says the decline in annual tablet shipments reached double digits for the first time on record in 2015. The firm's 2016 tablet shipment report shows a total of 168.5 million units of tablets were shipped last year, representing a 12.2% drop from 2014.
Anita Wang, notebook analyst for TrendForce, says the saturation of the tablet market, the long life cycles of tablets themselves and the abundance of substitute devices are major factors that contributed to the large shipment decline.
"Tablets were challenged by many large and small devices during 2015, from smartphones sized 5 inches and above to 2-in-1 PCs. Their demand diminished as a result," she explains.
Research and analytics firm Strategy Analytics says tablet shipments fell 10% to 46.5 million units during the Q1 2016, indicating the lowest decline sinceQ3 2012.
Peter King, research director Tablet and Touchscreen Strategies service at Strategy Analytics, says Apple's iPad sales declined for nine straight quarters as the average consumer finds little need to pay an Apple premium to upgrade to the latest and greatest models.
"This is why iOS market share has fallen to 22% this quarter. Now, Android tablet shipments are declining as the White Box vendor consolidates and branded vendors find it harder to compete on price in such a crowded market," observes King.
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