Remember how a few months ago received wisdom had it that the future of personal computing was tablets, and the PC—laptop or desktop—was a dying breed in the post-PC era?
Well, the latest meme circulating—which gathered momentum following Apple’s fiscal 2014 third quarter financials were announced on Tuesday—is that it’s now tablets that are passé. Apple’s iPad—which launched the touchscreen tablet revolution and the purported post-PC era way back in 2010—has just logged a second consecutive quarter of negative sales growth, and a sizeable cohort of pundits opines that tablets will prove an ephemeral phenomenon, much like PC netbook laptops did before they were eclipsed by the tablet onslaught, about to be superseded by a modest resurgence in PC popularity (Apple sold a better-than-expected 4.4 million Macs in the quarter) and a new onslaught of large-screen smartphones (AKA “phablets”).
The IT market is once again proving to have the attention span of a fruitfly, but in my opinion, rumors of the tablet’s (or for,that matter, the PC’s) imminent demise are greatly exaggerated. While Apple sold “only” 13.3 million iPads in its Q3/14, following a 16% iPad sales decline in its Q2 year-over-year, and down from heady 52% sales growth in 2013, a slackening of demand should have been anticipated after the low-hanging fruit of early adopters were picked over, and as the tablet market matured.
Apparently, it had been widely anticipated that tablet users would follow a two-year hardware upgrade interval similar to smartphones, but as it turns out people are typically hanging on to their tablets for three years or more. The iPad 2 on which I’m typing this is now 38 months old and still plenty serviceable. Personally, I think two or even three years of pre-obsolescence is absurd for a product that costs as much as either mobile devices or PCs. Of course, I’m a guy who still has two fully-commissioned PowerBook Pismos now well into their fourteenth year of useful service. I’m not a complete Luddite (I’ve also got a Haswell MacBook Air, and plan to upgrade my iPad soon as well), but my Mac system upgrade interval has stretched from less than three years two decades ago, to somewhat more than four years on my last three cycles, and so far it’s early days with iPads, but the initial precedent being set is in excess of three years.
Indeed, one of the factors that’s kept me buying Apple hardware for the past 22 years is that their stuff is built to last, making them especially attractive for folks like me who are more concerned that the tool be able do the job to which it’s called efficiently as required, as opposed to having the latest and greatest. Consequently, entry-level, low-end, or refurbished Apple devices—base spec laptops and 16 GB iPads—have been my usual choice.
Back to the iPad’s future prospects, 13.3 million units sold in a three-month interval is actually pretty impressive, and still gives Apple a healthy lead in the worldwide tablet market, which totalled 49.3 million units in calendar Q2/14 according to preliminary data from the International Data Corporation (IDC) Worldwide Quarterly Tablet Tracker. For some perspective, second-place Samsung sold 8.5 million tablets, and Lenovo, now the third largest selling tablet vendor globally, shipped 2.4 million units in the quarter.
“As we indicated last quarter, the market is still being impacted by the rise of large-screen smartphones and longer than anticipated ownership cycles,” said Jean Philippe Bouchard, IDC Research Director for Tablets. “We can also attribute the market deceleration to slow commercial adoption of tablets.”
However, Mr. Bouchard maintains that “Despite this trend, we believe that stronger commercial demand for tablets in the second half of 2014 will help the market grow and that we will see more enterprise-specific offerings, as illustrated by the Apple and IBM partnership, come to market,” signalling that IDC analysts think Apple is on the right track with the iOS for enterprise play.
Another happy prospect for resuscitating iPad sales is that if the typical upgrade interval is going to be three years, then there are a lot of users who are hitting that threshold, which should generate significant iPad (or perhaps in some cases large-screen iPhone) sales when they finally do replace their tablets.
However, on the consumer front, IDC Research Analyst, Worldwide Quarterly Tablet Tracker Jitesh Ubrani cautions, “Now we are seeing growth amongst the smaller vendors and a levelling of shares across more vendors as the market enters a new phase.”
My read is that some cannibalization from a larger-panel iPhone at the lower end and modestly resurgent MacBooks and desktops at the other are inevitable, but it doesn’t have to be a zero-sum equation. I love my iPad, and can hardly imagine living without it after three-plus years, but it’s definitely a complementary machine to my Mac laptops, and not their replacement—at least at the current state of the art, and 5.5-inch panels in largescreen smartphones even less so.