Fierce tablet fight to be rough for Apple's rivals
Less successful to exit market by year's end?
Here's a notion: there will be so many tablet wannabes fighting for market share in the second half of the year that rather a lot of them will be left with unsold stock on their warehouse shelves.
Whether they are pitching Android offerings, Windows machines or both, "non-Apple" tablet sellers risk being stuck with excess inventory, pundits have proclaimed.
We're not entirely convinced. Just-in-time manufacturing being what it is, plus potential and existing component shortages, mean demand is likely to outstrip supply, if anything.
Even a company with Apple's massive buying power can't get enough iPads out of the door to meet initial demand. And we're already hearing talk of limits to the availability of other tablets, such as Asus' Eee Pad Transformer.
However, unnamed "market watchers" cited by DigiTimes reckon the potential market for tablets is 20m units, a number possibly taken from total netbook shipments in recent years. They imply that the ten or so players - excluding Apple, we presume - will churn out more than 2m each. Since they won't all share the market evenly, some will be left with excess inventory.
Apple shipped 9.4m iPads in 2010, and has already shipped 4.7m in Q1 2011. Rivals won't expect to sell that number each quarter, but even their more modest expectations may prove overly optimistic, the pundits say, pointing to "lower-than-expected" sales of Samsung and Motorola tablets - the only big-name vendors with tablets available during Q1, other than Apple.
Some, they say, may even have drop out of the business altogether in Q4. ®
Choose your battles
The market performance of the tablets by Motorola and Samsung tablets have been weak because they have (naively and foolishly) attempted to make a full frontal assault on the ipad segment.
Specifically, they have tried to out-spec the ipad at the high-end price point.
For THAT much money, people aren't buying specs, they are buying prestige. And there isn't a snowball's chance in hell that Motoroal and Samsung will be able to out-prestige Apple at that price point.
Imho, the real growth will be seen in the mid- to low-end tablet market spaces. This segment has does not have an entrenched market leader. Also the volumes at this price point will be much higher (albeit at narrower margins). Look at how the smartphones have played out - the Android's growth has been huge - not because they have been stealing iphone sales (which doubled over the same period - while maintaining the same marketshare) - but because they tapped into a new segment.
Demand vs Common Sense
The main problem is that there is demand for these devices, the problem is they are either under spec'd over spec'd and the price for both are way off the mark.
The only one that is on the honey spot so far is the Asus Transformer with the keyboard at 429 pounds.
People are not going to pay over the top for either under or over spec'd devices, the consumer is much more savvy with there money especially in todays market place.
Even if there is high demand, people are not going to pay over the top for any Apple alternative with the benchmark sat on a nice 399pound margin. No matter if it has that little bit extra than a iPad.
Apple are well known for having the expensive hardware and that your buying into that prestige as mentioned in the post above. Any company trying to compete with this is bound to fail, especially on there first gen tablets.
No matter what sort of spin they are going to provide, unless its cost effective to the consumer its bound to fail.
The lack of an Asus Transformer in my hands says that there is unlikely to be much overstock.