Android tablets took the lead from Apple AAPL +1.82%‘s iOS tablets in Q1
of 2013 (source). This is a large change from 3 years past, once Apple
invented the modern tablet.
What is happening and wherever is this going? I see four driving forces:
Tablets are over a media consumption device now
Android has matured
The rise of Samsung
Democratization of tablets
Tablet computing is well beyond the management of Apple’s iTunes content
delivery system. Within the early days of the iPod and the iPhone
(ancestors of the iPad), you may hardly use the product while not
periodic plug-ins to iTunes to induce content and configure the device.
Afterward Apple’s App Store held hegemony on the apps that offer tablets
worth.
Those days are over. The chart at right shows that the largest usage
mode for tablets is communications: e-mail, web, social media, etc.,
wherever Apple has no advantage in content access. Work usage is also
vital, and the productivity apps for Apple and android are fairly
comparable.
The second biggest use is media and entertainment. Apple had a big
advantage at the beginning here, however the playing field here has been
leveled to an oversized extent. EBooks and music are equally available
on android, a large choice of video is offered from Google GOOG -0.49%
Play, Netflix NFLX -0.38%, and Amazon, and there are various android
tablet games, though most likely fewer options than iOS.
Android itself has come an extended way, last on tablets. Android 3.0
“Honeycomb” 2 years ago was weak and buggy, but the current 4.2 “Jelly
Bean” release is full-featured and slick. Market research suggests that
android users love their OS just as much as iOS users love theirs
(more). Combined with a pleasant hardward platform like the Nexus7,
android delivers an awfully competitive tablet.
And, Samsung is a force of nature. At CES in 2011 they'd a Galaxy
product targeting every Apple mobile product from the iTouch to the
iPad. They experiment with several size and design variations: they were
early with the now-dominant seven inch tablet and pioneered the
amazingly successful “phablet” conception (~5″ devices that are big
phones or mini tablets). consumer research showed that Samsung’s brand
did not match Apple’s, and that they responded with a brand promoting
blitz that makes them the largest U.S. spender in mobile electronics, as
well as LeBron James in a very Super bowl ad. Samsung is now arguably a
stronger brand than Android; the 2 along are formidable.
Apple is holding the price point up and resisted providing a smaller
tablet; it desires high prices to satiate Wall Street‘s lust for
predictable earnings. Different vendors have democratized the business
by with smart offers at lower cost points. The 5 preferred tablets on
Amazon nowadays (May 14, 2013) are four seven inch Kindle and Samsung
tablets selling for $179 – $229, and an 8.9 inch Kindle selling for
$269. Comparably designed, these products are $100-$200 cheaper than
Apple’s product. And, there's a 3rd tier of seven inch android tablets
within the $100-$200 price range that currently takes regarding
half-hour of the tablet market: the big orange band on the first chart
above.
Apple held on to over seventieth market share in iPods throughout the
life cycle. The iPod is a media consumption device, and also the link to
the iTunes content access/management platform was unbeatable. It’s
clear that tablets are a unique story, more like PCs. they're turning
into a diverse market with many strong brands (Samsung, Asus/Google, and
Amazon/Kindle), a large range of popular-price offerings, and multiple
content access platforms.
This is excellent news for the eco-system. Apple and Google have done an
excellent job of showing the way and making a rational platform,
however truth potential of tablet computing can emerge only if we let
all the flowers bloom
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