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Why tablets show strong growth as Android makes rapid strides

Puneet Sikka

Why tablets show strong growth as Android makes rapid strides (Part 1 of 5)

Android takes the lead from Apple in the tablet market in 2013

Ever since Apple (AAPL) released the iPad in 2010, the market has flooded with tablets from different players. Samsung (SSNLF) and Amazon (AMZN) have become formidable rivals to Apple in this market, and they started to take market share away from Apple. According to a Gartner report on worldwide tablet sales to end users by operating system, Apple’s iOS market share has declined from 52.8% in 2012 to 36.0% in 2013, while Google’s (GOOG) Android operating system jumped from 45.8% in 2012 to 61.9% in 2013. Microsoft (MSFT) also gained some market share, increasing from 1.0% in 2012 to 2.1% in 2013. So Android, which was behind Apple in 2012, took the lead from Apple in the tablet market in 2013.

Tablet market growth is driven by smaller low-cost tablets

The tablet market grew from 116 million unit sales in 2012 to 195 million in 2013—a growth rate of 68%. This market was primarily driven by the growth of smaller low-cost tablets, for which quality standards also improved in 2013. Apple’s products are primarily high-end, so it suffered market share loss in 2013.

According to Roberta Cozza, research director at Gartner, “In 2013, tablets became a mainstream phenomenon, with a vast choice of Android-based tablets being within the budget of mainstream consumers while still offering adequate specifications. As the Android tablet market becomes highly commoditized, in 2014, it will be critical for vendors to focus on device experience and meaningful technology and ecosystem value — beyond just hardware and cost — to ensure brand loyalty and improved margins.”

Emerging markets are the main impetus of growth for the tablet market

Another interesting aspect of the report was that emerging markets recorded growth of 145% in 2013, while mature markets grew only 31%. China and India are the primary emerging markets, and they’re driving this growth. In another Market Realist article, Why is Facebook seeing such rapid mobile web ad growth?, we discussed how the Indian mobile Internet market has a lot of potential and how it’s helping drive Facebook’s (FB) growth in this market.

Continue to Part 2

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