Dell Ditches Android Tablets, Will Focus on Two-in-Ones

Company officials say business users and consumers are turning to new PC form factors that allow them to be more productive.

Dell tablet

Dell has become the latest PC vendor to shed its Android tablet business, with officials saying the tech vendor will instead focus on its portfolio of two-in-one systems.

Rival HP Inc. late last year announced it was exiting the low-end consumer tablet market—many of them Android devices—choosing instead to put its money and time into building more profitable systems for the commercial space. That includes tablets for such areas as education, retail and health care.

In a recent post on the company blog, Kirk Schell, vice president and general manager for commercial client solutions for Dell, confirmed that the company was getting out of the Android tablet business, saying that except for a few instances, most technology users are opting for new form-factor PCs that give them all the tools they need to be as productive as possible. PCs in general—and Windows-based two-in-one systems that can be used as either a traditional PC or a tablet, in particular—are what most users are turning to, Schell wrote.

"The one constant feature across all of the devices people choose for work is that they must enable productivity," he wrote. "While there will always be a need for niche devices and certain features for specific computing tasks, we've found that the lack of productivity delivered by slate tablets are forcing people to leave them at home, and instead continue to use PCs to get real work done. More specifically, we believe 2-in-1s are starting to become the preferred device for those in the workplace who occasionally want to operate the device in tablet mode, which is why we're continuing to invest in the space, while beginning to divest from the slate tablet market."

Dell will continue to support the Android-based Venue tablets that have been sold through the lifetime of the warranty and service contracts, but will not offer upgrades of the OS.

Apple's introduction of the iPad in 2010—combined with the growing adoption of smartphones from Apple and device makers embracing Google's Android mobile operating system—kicked off several years of rapid growth of mobile devices sales that has coincided with the contraction of the global PC space. However, recent quarters have seen smartphone sales beginning to slow and tablet adoption falling, and even though the overall PC market continues to struggle, industry analysts are seeing growth in demand for two-in-one systems.

Schell noted Gartner numbers that indicated that only 17 percent of consumers in mature markets say they intend to buy a tablet in the next 12 months, and that IDC said that in the most recent quarter, slate tablet sales fell 21.1 percent. The tablet market is oversaturated and demand is falling, and end users are turning to two-in-ones with screen sizes in the 10- to 13-inch range, he said.

"Dell is repositioning its mobile products portfolio to take advantage of both the resurgence of the 2-in-1 market and the continued growth of the traditional form factor laptop," Schell wrote. "With the release of Windows 10, our 2-in-1s and laptops are positioned to take advantage of the largest growth opportunities within the personal computing space. Detachable tablets (or 2-in-1s) reached an all-time high of 8.1 million devices in the fourth quarter of 2015. They have also more than doubled their shipments since the fourth quarter of last year."

Despite the problems in the PC market over the last several years—IDC analysts said that in the first quarter, PC shipments worldwide dropped 11.3 percent over the same period last year—Dell officials have said PCs continue to play a central role in the company's end-to-end enterprise IT solutions efforts, from customer acquisition to its Internet of things (IoT) strategies. That will continue even after Dell completes its $67 billion acquisition of data storage vendor EMC and its associated businesses.

That contrasts with the direction taken by Hewlett-Packard officials, who in November 2015 split the giant tech vendor in two, separating its PC business from its enterprise units.