Apple's iPad and Google's Android tablets will continue to pace the slate market in 2012, with an assist from Microsoft Windows 8, said Jefferies & Co.
could top 125 million units in 2012, led by Apple's (NASDAQ:AAPL) iPad and
tablets based on Google's (NASDAQ:GOOG) Android and Microsoft's (NASDAQ:MSFT)
Windows 8 operating systems.
So goes the
prognostication from equity analysts at Jefferies & Co., which actually
shaved off 25 million units from its earlier estimate for this year because the
market consolidated faster than it expected.
carrier tablet subsidies never materialized in 2011. Carriers such as Verizon
Wireless and AT&T simply chose not to aggressively market their Android
tablet offerings, impinging unit sales.
analyst Peter Misek said Apple sold 40.5 million of the 70 million tablets that
shipped in 2011, with Samsung shipping 10 million Galaxy Tabs and Amazon
(NASDAQ:AMZN) selling 4 million Kindle Fire Android tablets for the year.
Kindle Fire and some Tab models being the exceptions, much of the Android
tablet market suffered from built-in anemia.
Most of the
machines were initially priced too high compared with the iPad, which started
at $500 for the WiFi model. Motorola Mobility (NYSE:MMI) sold its Xoom Android
Honeycomb tablet for $699 on contract a year ago this month.
That price, some
bugs in Honeycomb, and the lack of a strong application ecosystem for Android
slates led to Motorola only selling 1 million tablets for 2011. For
perspective, Apple sold 15.4 million iPads last quarter alone.
Fire came to market Nov. 15 with the opposite approach: It was WiFi-only and
cost $199. These factors made the tablet quite attractive to cost-conscious consumers
Over 4 quarters, the Fire could conceivably sell 16 to 24 million units.
then, from Misek, who said Android tablet apps should drive shipments in 2012.
had originally modeled the 2012 tablet market to top 150 million units shipped.
He's curbed his model to account for market consolidation. Specifically, tablet
vendors, including Research In Motion (NASDAQ:RIMM), HP (NYSE:HPQ) and other
Android OEMs, failed to gain any traction against Apple, Samsung and Amazon.
RIM and HP all slashed prices, often quite aggressively, to sell off inventory
and grab some market share.
If there is a
silver lining here, it is that the tablet market is a lot younger than the
steadily maturing smartphone sector. Misek believes Android will have "a more
seamless offering across handsets and tablets," likely owing to the
merging of the smartphone and Honeycomb branches into the Android 4.0 Ice Cream
Sandwich operating system.
Of course, the
iPad juggernaut should continue in 2012 with the iPad 3, expected to launch in
the first quarter. When the iPad 3 becomes available, it is widely expected
Apple will follow the pattern it set for its iPhones by discounting the iPad
and iPad 2. With Apple setting the bar and market expectations, Misek expects
tablet prices to fall to an average of $350.
The market may
be dominated by iPad with an assist from Android in the near future, but
Microsoft will make a "viable push with its Windows 8-based tablets,"
Misek wrote in a Feb. 6 note to clients. "The first ones are likely to
launch in late 2012, but the units will likely not significantly ramp until 2013."