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Apple Widens Its Lead in Sizzling Tablet Market

Apple Widens Its Lead in Sizzling Tablet Market

Apple is still far and away the tablet sales king, according to recent numbers from IDC. But Android sales are growing too, and the market is shifting with the rise in popularity of smaller and cheaper tablets like the Kindle Fire and the Nexus 7. But Apple could well invade that corner of the market also with a miniature iPad, which is rumored to be in production.

By Rachelle Dragani MacNewsWorld ECT News Network
08/03/12 10:56 AM PT

Apple shows no signs of yielding its clear lead position in tablet sales following a record second quarter in a tablet market that's hotter than ever, according to research from IDC.

Tablet makers worldwide shipped 25 million units in the second quarter of 2012, IDC found. That's 34 percent more than the 18.7 million they shipped in the first quarter, and a 66 percent surge over the same period last year.

The iPad is still the favorite among those tablets. Apple, still strong off the March release of its newest iPad, accounted for 68.2 percent of the market, up from 61.5 percent in the same quarter a year ago. The company shipped 17 million iPads in the second quarter, compared to 9.24 in the second quarter of 2011.

Samsung, with 9.6 percent of the market, also experienced growth since a year ago. It shipped 2.4 million units, up from 1.1 in the same quarter last year.

Amazon took the third spot after Samsung and Apple, shipping 1.2 million Kindle Fire tablets on the quarter, a 5 percent marketshare. Asus and Acer rounded out the fourth and fifth spots on IDC's list.

Long Live the King?

Though Samsung and Amazon were able to snag some marketshare away from Apple during the second quarter, the company's rivals have their work cut out for them if they want to knock the iPad maker out of its leadership position, said Patrick Moorhead, president and principal analyst at Moor Insights & Strategy.

"Apple still remains the commanding tablet marketshare leader, and their lead grew even more last quarter," he told MacNewsWorld. "Their iPad 2 at the reduced price of (US)$399 really hurt any 10-inch Android tablets. Add that to the fact that larger Android tablets only have hundreds of optimized apps, and their value proposition is very, very weak."

Still, Samsung's ascent is a sign that there are viable competing tablets on the market, said Moorhead, and Google shouldn't be left out of the conversation. Google's recent launch of the Nexus 7 tablet wasn't included in IDC's report, since it just started shipping. But the smaller, more affordable tablet could make a dent in the market if Google can minimize distribution problems, said Moorhead.

"The biggest surprise was the recent launch of the Nexus 7, a no-compromise 7-inch tablet at $199. We will have to wait until third-quarter numbers to see how well it actually did. Unfortunately for Google and consumers, it is sold out in many places and has limited physical distribution."

Keeping Things Interesting

Escalating competition from the 7-inch form factor could give Android an additional boost in marketshare, said John Feland, CEO and founder of Argus Insights.

"Demand for the Kindle Fire is slowing based on our data," he told MacNewsWorld, "while demand for the Galaxy Tab 2 7.0 is rising quickly, showing that given small differences in price, consumers want a full Android experience, outside of Amazon's highly curated version available on the Kindle Fire."

The Nexus 7 could have the best Android experience yet on a tablet, said Feland. In the case it does make a splash in the market, Apple probably isn't planning to sit by and watch it happen. The company is rumored to be launching a 7-inch tablet of its own, a so-called iPad mini that will be similar in size and form to the smaller, more affordable Kindle Fire and Nexus 7. The device could launch as early as this fall, or at least in time for the holiday season.

"I believe Apple will launch a smaller-screen iPad to better compete with the Fire and Nexus 7," said Moorhead. "The iPad mini would be very popular, but the degree of volume will be governed by its price. The 7 -and 8-inch tablet market will be more sensitive to price, as this size device is truly optimized for content consumption."

At a competitive price, said Moorhead, the Nexus 7 might have a chance at competing with an iPad mini. The Kindle Fire, though, will have to be revamped if it wants to retain its marketshare, which he said he expects to see soon.


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