Will the Tablet Market Be as Big as Once Thought?

August 01, 2014
By: Gary Kim

Tablet sales are slowing, and that has some might now be wondering just how big the tablet market is going to be, a somewhat shocking development for a product that many observers say has been the fastest-adopted consumer product of all time.

Best Buy, for example, says tablet sales are “crashing”. And during its second quarter 2014 earnings call, Corning (News - Alert) acknowledged it had seriously misjudged demand for glass that goes into tablets.

“We just got that really wrong about what was happening in the tablet market,” said Jim Flaws, Corning CFO. “And we have adjusted down our forecast for that dramatically compared to our original expectation.”

Tablets, recall, were supposed to be a prime example of the “post-PC” era. In May 2014, for example, IDC (News - Alert) lowered its forecast for tablet sales to 12 percent annual growth, from an earlier forecast of 52 percent.

IDC says two different trends are at work. “First, consumers are keeping their tablets, especially higher-cost models from major vendors, far longer than originally anticipated,” IDC said. That means the replacement cycle often seen in the smartphone market, where consumers upgrade every two years or so, does not seem to be as prevalent in the tablet market.

"Second, the rise of phablets--smartphones with 5.5-inch and larger screens--are causing many people to second-guess tablet purchases as the larger screens on these phones are often adequate for tasks once reserved for tablets," IDC said.

Gartner (News - Alert) researchers also say tablet adoption is slowing. Tablets are currently moving onto the latter part of the adoption curve in mature markets, Gartner says.

Gartner estimates that sales of tablets will see a relative slowdown in 2014 to reach 256 million units, an increase of 23.9 percent from 2013.

Lower demand from users for tablets with smaller screens, some in favor of larger screens, in mature markets, and the shift towards phablets in Southeast Asia are slowing global tablet penetration.

Some have argued households eventually will have multiple tablets “lying around the house,” and might be general purpose appliances rather than personal devices. But some might argue that vision is, at least for the moment, questionable. 




Edited by Adam Brandt