Tablet sales decreased by 20 per cent in 2014 according to technology analyst firm Telsyte, and without needing to replace or upgrade them, consumers are turning to wearables with a similar price point as entry-level tablets.
Telsyte attributes the slowing demand to the saturation in the iPad and Android tablet markets.
According to Telsyte, the slowdown is cyclical; nearly half of Australians who have ever purchased a tablet did so in 2013 and few found a reason to upgrade their device in 2014.
Telsyte senior analyst Alvin Lee says low cost tablets purchased as gifts have lost their appeal and more consumers are now looking towards wearable devices as presents, or to meet their gadget buying urges.
“The average cost of a smart fitness band is similar to an entry-level tablet, making it a popular alternative for those who already own a tablet,” Lee said.
Apple reclaimed the market leader position in the second half of 2014, making up nearly half of all unit sales from July 1 to December 31. However, only Windows tablets saw a year-on-year increase in unit sales amid growing consumer interest in smart wristbands and smartwatches during the same period, Telstye reported.
Telsyte predicts the market will improve in 2015 but also shift towards 2-in-1 hybrid products as Windows-based PC users look to upgrade to convertible or hybrid devices that allow them to run PC applications on a tablet form factor. Telsyte is including PCs with touch screens and detachable keyboards, or that can be folded into a tablet form, including Microsoft Surface or Lenovo Yoga 3 Pro.
This echoes Asus regional director Portia Chang’s view that the 2-in-1 laptop tablet hybrid has become a mainstream category.
Telsyte managing director Foad Fadaghi, says computers remain the preferred device for the creation of documents and media editing.
“Telsyte believes there will be strong demand of convertibles or 2-in-1 devices, as mainstream business and consumer users look to update to Windows 10 later this year,” Fadaghi says.
Despite their massive appeal, Telsyte’s research indicates two-thirds of Australians do not believe a pure tablet device will ever be their primary computing device, a figure that has risen from 56 per cent in 2013.
Telsyte expects wearable devices such as Microsoft’s HoloLens and Samsung’s Gear VR to also challenge the role of tablets in a connected-home environment.