Samsung Galaxy Chips Away at Apple Tablet Market Share: Strategy Analytics

Apple's iPad owned 95 percent of the tablet market in Q3, but one quarter later it's slipped to 75 percent, due to Samsung's Galaxy Tab and other Android tablets.

Apple's iPad is still the world-dominating tablet by far, but during the fourth quarter, competitors running Google's Android OS-led by the Samsung Galaxy Tab-took a sizeable bite out of Apple's lead.

While Apple fully owned the market during the third quarter of 2010, with 95 percent of the worldwide market share, its share slipped to 75 percent during the third quarter, research firm Strategy Analytics reported Jan. 31.

"Android tablet volumes experienced 2,000 percent sequential growth and its global market share soared to a record 22 percent in Q4 2010," Strategy Analytics Director Neil Mawston said in a statement.

The main driver behind Android's growth was Samsung, which, following heavy promotions and the launch of the Galaxy Tab in dozens of countries, has sold more than 2 million units. During the first half of 2011, Strategy Analytics expects the Android OS to continue accounting for larger portions of the market. "Tablet makers like Android because of its perceived low cost and an accompanying range of compelling media services such as YouTube and Google Maps," Mawston said.

The tablet market as a whole grew 120 percent sequentially, with 9.7 million tablets shipping during the quarter, up from 4.4 million the quarter before. Apple shipped 7.3 million iPads, compared with the 2.1 million Android tablets that shipped. "Other" operating systems accounted for 0.3 percent of the market, making up about a half percent during the whole of 2010.

The United States was "by far" the world's largest consumer of tablets during the quarter, reported Strategy Analytics, making it a market that "no major vendor can afford to ignore." The firm added that the growing tablet base will make Android "a more attractive platform for media developers in the United States and worldwide."

New models from major vendors are scheduled to arrive in stores during the first half of 2011. Big things are expected of the Motorola Xoom, which will run the tablet-optimized Android 3.0, known as "Honeycomb." Motorola has reportedly placed orders for nearly 800,000 Xoom tablets, with orders expected to ramp up to 1 million during the first quarter. Research In Motion, with its enterprise-geared PlayBook, is expected to enjoy similar sales, as it's reportedly producing 1 million units for this quarter-during which it will release a WiFi-only version, before shipping a Sprint 4G-enabled version this summer.

Earlier this month, IDC forecast 44.6 million tablets to ship in 2011-with U.S. sales accounting for nearly 40 percent of the total-and grow to 70.8 million units in 2012.

Encouraging tablet sales, wrote IDC's Research Director Susan Kevorkian, will be "new product and service introductions, channel expansion, price competition and experimentation with new-use cases among consumers and enterprises."

Ticonderoga Securities analyst Brian White expects that, any time now, Apple will share news of an iPad 2, potentially persuading consumers to hold off on the purchase of a Motorola Xoom or other Apple-competing device and "wait for the new iPad that we believe will be launched in March/April."