iPad Shipments up 44 Percent As Apple Continues Tablet Market Dominance

Apple's hold on the tablet market is growing, despite the presence of new rivals, such as Google's Nexus 7 tablet, according to new IHS report.

The competition in the today's tablet computer market may be hot and heavy with the unveiling of new rivals such as Google's Nexus 7 tablet, but Apple's iPads continue to lead and grow their global market shares, according to a new study from market intelligence firm IHS.

In the second quarter of 2012, Apple shipped 17 million iPad 2 and iPad tablets, an increase of 44.1 percent from 11.8 million in the first quarter, according to the IHS figures. Apple also increased its market share in the quarter by 11.5 percentage points, to capture 69.6 percent of the global tablet market, up from 58.1 percent in the first quarter.

"This marks a five-quarter high for Apple's media tablet market share," the study reports. "The last time Apple accounted for such a large portion of the media tablet was the first quarter of 2011, when it had a 70 percent share."

The study mimics the results of a July 2011 study from investment firm Cannacord Genuity, which concluded that Apple's iPad franchise will continue to dominate the tablet market for some time to come, according to an earlier eWEEK report. That report estimated Apple's share of the tablet market at 56 percent in 2011, followed by Samsung with 12 percent, and Asus with 5 percent. LG Electronics, Motorola, Research In Motion and HTC all lagged behind.

"Apple is making all the right moves to rebuild its dominant position in the tablet space," said Rhoda Alexander, a tablet and monitor analyst with IHS. "The company is pushing visual performance boundaries with the new iPad, while providing value customers with a lower-priced alternative, the iPad 2. With the expected entrance of the 7-inch version of the iPad in September, Apple is sending a clear message that it plans to dominate this market over the long term."

The IHS study reports that Apple rivals shipped far fewer tablets in the second quarter.

Samsung shipped 2.3 million tablets, Amazon shipped 1 million tablets and Asus shipped 688,000, according to the survey. Compared with Apple's market share numbers for the quarter, Samsung has 9 percent of the market, Amazon 4 percent and Asus 3 percent.

"Apple's major media tablet rivals, Google Inc. and Microsoft Corp., hope to challenge Apple in the second half of the year, but will be facing formidable headwinds, with no sign that the market leader is backing off of its aggressive strategy in the market," according to IHS.

What Apple is doing to grow its share of the market, wrote Alexander, is to continue to build on its "well-developed ecosystem of content and applications it had in place before entering the tablet market, and its absolute control of the hardware, software and operating system. When a customer buys a media tablet, what he or she is really doing is purchasing a key to that ecosystem, not just a piece of hardware."

For the likes of Samsung, Amazon, Asus and others, that's been tough to match and take on in the marketplace, wrote Alexander. "This, however, has left an obvious opening for 2012's newest market entrants: Google with the Nexus 7, and Microsoft with its Surface products," she wrote.

In addition, capturing such a large piece of the early global market will likely help Apple maintain that domination in the future due to the company's high customer retention history, according to Alexander. Since the iPads first went on sale in April 2010, Apple has sold more than 85 million iPads.

"In all likelihood, Apple already has developed a solid future customer base, which will continue to strengthen, barring a major stumble on an upcoming product release," according to IHS. In contrast, Samsung, Apple's closest competitor, has shipped almost 13 million total media tablets overall since bringing out its first Galaxy Tab in the fourth quarter of 2010. Those sales figures, however, don't even match the sales that Apple reached by Christmas of 2010, IHS reported.

Apple's rivals such as Microsoft and Google, however, have that larger user experience in their sights and take it very seriously, according to the report. "To date, the media tablet for the most part has been a consumer phenomenon, but the next big battle will be fought in the business space. Indeed, the ongoing rivalry is shaping up to be a battle of the Titans."