Tablet Market Drops nearly 15% in Q3

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Vendors shipped 43 million tablets in the third quarter (Q3) of 2016, a 14.7 percent year-over-year decline. On the bright side, shipments were up 9.8 percent over the previous quarter in the ramp up to the holiday season.

A flood of low-cost tablets with detachable keyboards, many priced at under $200, is shaking up the market, but not necessarily in a beneficial way, said IDC senior research analyst Jitesh Ubrani.

“Unfortunately, many low-cost detachables also deliver a low-cost experience. The race to the bottom is something we have already experienced with slates and it may prove detrimental to the market in the long run as detachables could easily be seen as disposable devices rather than potential PC replacements,” said Ubrani in a statement.

Jean Philippe Bouchard, research director at IDC, said the industry is “witnessing real tectonic movements in the market with slate companion devices sold at the low-end serving a broader platform strategy, like Amazon is doing with Alexa on its Fire Tablets, and more expensive productivity tools closer to true computing and legitimate notebook replacement devices that should manage to keep average prices up.”

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Apple remains the market leader with shipments of 9.3 million iPads and a 21.5-percent share of the market. “Although Apple’s tablet shipments declined 6.2 percent year over year, total iPad-related revenues were flat for the quarter, thanks to the iPad Pro offering,” observed IDC.

iPad sales totaled 9.3 million units in Q3, revealed Apple during in its fourth quarter fiscal 2016 earnings call. “iPad ASP [average selling price] was $459, $26 higher than a year ago, with increase driven by the new iPad Pro line,” said Apple’s CFO Luca Maestri during the call.

Second-place Samsung saw its share of the market slip to 15.1 percent from 16 percent a year ago on shipments of 6.5 million tablets. Amazon’s shipments tablets surged 319.9 percent to 3.1 million units, largely due to the popularity of the company’s Prime Day “Fire” sale. The momentum may carry into the current quarter for the cloud and online retailing giant, courtesy of the new Fire HD 8.

Lenovo and Huawei round out the top five, with shipments of 2.7 million and 2.4 million tablets, respectively. Huawei’s improving brand image and cellular-equipped tablets, which sell for as little as Wi-Fi only models from rivals, helped the Chinese electronics maker buck the trend and post a 28.4-percent increase in shipments.

Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.