Double-digit decline in shipments may be deflating the sails of tablet hype

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During the holiday season, plenty of tech gifts were exchanged amongst friends and family. Smart watches, fitness trackers, game consoles, inexpensive flat screens, Bluetooth speakers, and lots and lots of iPhones. What probably wasn’t moving the needle as much during the gift giving season were tablets. According to ICD’s numbers released earlier this week, fourth quarter worldwide tablets shipments for 2014 have experienced their first decline since the introduction of the iPad in 2014. While tablet makers still sold in the millions, 76.1 million to be exact, between the months of October and December, they were still in decline in comparison to the 78.6 million tablets sold from the previous year’s quarter.

Back in 2010 the iPad was met with some confusion, some lofty predictions and mountains of criticism, but the overwhelming hype was, excitement. The buzz alone had manufacturers rushing to their mills to reproduce a product that could exist in the same arena. Four years later and a sea of black slabs, it looks like that excitement is waning just a bit.

With these new numbers, some media outlets are prematurely calling for the end the tablet market. Those who favored the form factor of traditional PC’s or Mac’s are now running up and down the streets clutching their clamshell laptops in a fit of adulation. These same individuals are now reassured their years of cautious speculation about the resilience of the form factor have seemingly been proven sound.

IDC 4th QRT Numbers

While shipments are down and particularly during the gifting season where it’s reasonable to assume they would see a boost, tablets are by no means dead. It would appear tablets have crashed against the shores of saturation much earlier than their desktop and notebook cousins. Markets like North America and Europe have reached a saturation point when it comes to high-end tablet consumption. Those who wanted iPads already have them and those who wanted cheaper alternatives are now seeing hand-me-downs from relatives, friends, and co-workers who have moved on to alternative means of digital consumption.

Another factor was chipping away at market sales or the ever empowering smartphones. From an ease of use to carrier subsidies, phones usage has supplanted most forms of digital communication and consumption. Add, the addition of 5 plus inch phones, faster processors, phone tailored apps and amazing camera, the argument for use of a (usually homebound) tablet becomes even harder to defend.

It’s not all bad news for tablet makers though. Among the biggest vendors, Lenovo was the lone OEM, who’s shipments didn’t suffer double-digit decline in the last quarter and that’s in large part to positioning in Asia/Pacific markets. As OEM’s look to continue the modest sales of their tablet wars, it looks like they will focus more on the booming Asia/Pacific markets to serve lower price segments and fill that area of growth.

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