Will tablet devices hurt sales of other devices? Not much
TweetFollow Us on Twitter

Will tablet devices hurt sales of other devices? Not much

A new study by Rethink Technology Research found that about three quarters of the sales of tablet devices, such as the iPad, will be at the expense of the purchase or upgrade of another device in many case one with higher price tags and margins than the tablet.

Vendors will hope these will be companion products, acquired in addition to a phone or notebook, but that means the prices have to be keen, to encourage consumers in a recession to invest in a non essential item, says the research group. Even Apple has come in with an iPad entry price far lower than most had expected, and a recent research note from Credit Suisse points out that Apple management noted that it will remain nimble (pricing could change if the company is not attracting as many customers as anticipated). Remember, Apple slashed the price of the iPhone by $200 two months after it went on sale.

Apple stands to make margins of almost 43% on the new tablet, so has plenty of room for maneuvering, but this will be less true of many other players as competition mounts. Freescale is already gearing its smartbook platform at sub $199 devices.

The emerging device category will fall into three broad subsections, plus the ereaders. Although these are single function, they have established many of the norms for the broader market, such as embedded wireless connectivity and integrated content stores. And some vendors, like Amazon, will extend their ereader platform into more general purpose products.

The three multifunctional categories, which will overlap, are the tablet (single sided, large touchscreen product heavily geared to content consumption, from video to ebooks); the smartbook (often hinged, like a tiny netbook, with some local storage but optimized for web services as well as some downloaded content); the cloudbook (the newest category, to be pioneered by Google for its Chrome OS, and offering an ultrathin client with little or no local data and apps, doing everything online via the browser and attached to the cloud).

Squeezed prices and margins may be acceptable if these hybrid devices are incremental purchases, but even worse for the suppliers, this will not generally be the case, especially in the first few years. Until at least 2013, consumer spending will remain under pressure, and there will be insufficient confidence in the thin client/cloud usage model for many people to rely on a cloudbook or tablet as their only computer. As I've said before, devices such as the iPad are, for the majority of people, supplementary devices, not replacement devices.

These devices will total about 60 million unit sales by 2014 according to the Rethink survey, with a market value of US$13.5 billion in hardware terms alone, plus about half that much again in directly related content/app sales. Rethink says about three quarters of their sales will be at the expense of users investing in new computers, netbooks or phones, or upgrading the ones they have. But I disagree -- except in regard to netbooks.

-- Dennis Sellers

 

Community Search:
MacTech Search:

Software Updates via MacUpdate

Gordon Ramsay DASH: Guide to upgrading a...
If we've learned anything about celebrity chef Gordon Ramsay over the years, it's that you don't want him angry and breathing down your neck. He's not above calling you out on TV, making a mockery of your efforts in the kitchen in front of... | Read more »
Galaxy of Trian (Games)
Galaxy of Trian 1.1.0 Device: iOS Universal Category: Games Price: $6.99, Version: 1.1.0 (iTunes) Description: Galaxy of Trian is an exciting, fast paced digital board game based on the highly acclaimed tabletop title. | Read more »
Dead In Bermuda (Games)
Dead In Bermuda 1.0 Device: iOS Universal Category: Games Price: $4.99, Version: 1.0 (iTunes) Description: | Read more »
The Little Fox (Games)
The Little Fox 1.0.1 Device: iOS Universal Category: Games Price: $2.99, Version: 1.0.1 (iTunes) Description: The Little Fox is an alternative perspective on the world-renowned ‘fairy tale for adults', The Little Prince by Antoine de... | Read more »
5 popular free fertility apps
There was a good article this week in The Independent about how more women are using fertility appsas a de facto form of contraception. It's apparently not working too well, leading to numerous unwanted pregnancies. [Read more] | Read more »
How to get more cars in CSR Racing 2
NaturalMotion and Zynga brought a lot of real life cars to the table for CSR Racing 2. From souped up everyday rides made by Nissan and Hyundai to supercars produced by the likes of McLaren and Pagani, there really is something for everyone. [... | Read more »
Crypt of the NecroDancer Pocket Edition...
Crypt of the NecroDancer Pocket Edition 1.0 Device: iOS Universal Category: Games Price: $4.99, Version: 1.0 (iTunes) Description: Crypt of the NecroDancer is an award winning hardcore roguelike rhythm game. Move to the music and... | Read more »
Gear-grinding puzzle title Inner Circle...
If you saw our post earlier this month announcing the imminent release of ZPlay’s new creation, Inner Circle, you’ll be happy to know that it’s now available on the App Store. Established in 2010, developer and publisher ZPlay have taken the... | Read more »
CSR Racing 2: Your guide to what's...
CSR Racing 2, or CSR2, as it likes to call itself, has finally arrived. The follow-up to the immensely popular drag racing game CSR Racing is the first release from NaturalMotion since the studio's acquisition by Zynga in early 2014. [Read more] | Read more »
Nanuleu (Games)
Nanuleu 1.1 Device: iOS Universal Category: Games Price: $2.99, Version: 1.1 (iTunes) Description: Nanuleu is a strategy game where you take control of ancient magical trees that protect the land from an invading dark force. A... | Read more »

Price Scanner via MacPrices.net

July 4th sale: $100 off 13-inch MacBook Airs
Amazon has 13″ MacBook Airs on sale for $100 off MSRP for a limited time. Shipping is free: - 13″ 1.6GHz/128GB MacBook Air (sku MMGF2LL/A): $899.99 $100 off MSRP - 13″ 1.6GHz/256GB MacBook Air (sku... Read more
Swiftpoint Launches Advanced Pivot, Tilt And...
Christchurch, New Zealand based Swiftpoint has announced the launch of its new generation computer mouse, The Z, on the crowdfunding website kickstarter.com. The company’s previous device, the... Read more
Clearance 12-inch Retina MacBooks, Apple refu...
Apple has Certified Refurbished 2015 12″ Retina MacBooks available starting at $929. Apple will include a standard one-year warranty with each MacBook, and shipping is free. The following... Read more
12-inch MacBooks available with free bundles...
Adorama has 12″ Retina MacBooks available including free shipping plus NY & NJ sales tax only. For a limited time, Adorama will include a free Apple USB-C to USB Adapter, free 4-Port USB Hub, and... Read more
Das Keyboard Unveils First Cloud-Connected Ke...
Austin, Texas based Das Keyboard has unveiled the newest addition to its family of high-performance mechanical keyboards with the introduction of the Das Keyboard 5Q on Kickstarter. Built with... Read more
13-inch 2.7GHz Retina MacBook Pros on sale fo...
Adorama has 13″ 2.7GHz Retina MacBook Pros on sale for up to $130 off MSRP. Shipping is free, and Adorama charges NY & NJ sales tax only: - 13″ 2.7GHz/128GB Retina MacBook Pro: $1169 $130 off -... Read more
New App Reminds Us to Put Down Our Phones and...
Mode, a new smartphone app that makes us more mindful of how we use our devices, debuts in the app stores today. The Mode app tracks time spent in different modes of day-to-day life without... Read more
ZuumSpeed Personalized Speedometer + HUD For...
RMKapps has announced the release and immediate availability of ZuumSpeed 1.0, its personalized speedometer plus heads up display for iOS devices. ZuumSpeed gives users over 18 custom fonts available... Read more
Apple refurbished clearance 15-inch Retina Ma...
Apple has Certified Refurbished 2014 15″ 2.2GHz Retina MacBook Pros available for $1609, $390 off original MSRP. Apple’s one-year warranty is included, and shipping is free. They have refurbished 15... Read more
9-inch 128GB Silver iPad Pro on sale for $50...
B&H Photo has the 9.7″ 128GB Silver Apple iPad Pro on sale for $699 including free shipping plus NY tax only. Their price is $50 off MSRP. Read more

Jobs Board

*Apple* Retail - Multiple Positions - Apple,...
Job Description: Sales Specialist - Retail Customer Service and Sales Transform Apple Store visitors into loyal Apple customers. When customers enter the store, Read more
*Apple* iPhone 6s and New Products Tester Ne...
…we therefore look forward to put out products to quality test for durability. Apple leads the digital music revolution with its iPods and iTunes online store, Read more
*Apple* Retail - Multiple Positions, Fort Wo...
Sales Specialist - Retail Customer Service and Sales Transform Apple Store visitors into loyal Apple customers. When customers enter the store, you're also the Read more
*Apple* Retail - Multiple Positions - Apple,...
Job Description: Sales Specialist - Retail Customer Service and Sales Transform Apple Store visitors into loyal Apple customers. When customers enter the store, Read more
*Apple* iPhone 6s and New Products Tester Ne...
…we therefore look forward to put out products to quality test for durability. Apple leads the digital music revolution with its iPods and iTunes online store, Read more
All contents are Copyright 1984-2011 by Xplain Corporation. All rights reserved. Theme designed by Icreon.