A close look at why the tablet market isn't coming back
The tablet market has hit a wall. Shipments contracted for the second consecutive quarter at the start of 2015, declining by 6% year-over-year (YoY).
On an annual basis, the tablet market has fallen off dramatically.
But by 2014, total tablet shipments growth had slowed to just 8%.
In a new report from BI Intelligence on the tablet market, we have revised down our tablet shipments projections for what was once the fastest-growing consumer electronics category, after sustained contraction in the tablet market over the past two quarters.
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Here are some key points from the report:
- We estimate very modest annual growth over the next five years, driven by enterprise uptake and low-cost device sales. We expect global tablet shipments to grow at a slow 2.5% compound annual growth rate (CAGR) between 2015 and 2020, reaching just 281 million units shipped at the end of the forecast period.
- The marquee tablet - the iPad - has seen shipments decline for five consecutive quarters. In the first quarter, iPad shipments declined 23% YoY, the product's worst quarterly decline ever.
- Meanwhile, the market is being overrun by generic, low-cost devices. These white-box tablets now make up 43% of all tablet shipments, up from a 25% share just a year ago. Apple and Samsung have ceded a combined 10 percentage points of market share over the last year.
- The enterprise serves as the tablet's last-chance market, but it won't completely reverse the outlook for the device. Tablets will make up just 4% of total enterprise device activations by 2018, even after growing faster than all other enterprise device segments.
- Even in the US, a more tablet-friendly market, tablet penetration in the enterprise is minimal. Just 18% of companies claim they already have tablets in use, though another 50% say they have plans to deploy tablets this year.
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