Why Apple iPad will keep tablet share crown: A lesson from the iPod

“Almost 3 years into the Apple iPad launch there appears to be an interesting pattern emerging regarding tablet market share which could be good news for Apple investors,” Bill Shamblin writes for Seeking Alpha. “Despite the availability of a number of competitive tablets in the market with the release of Google’s Android Honeycomb 3.0 in 2011, Apple appears to be holding it’s own in table market share, with a 50.4% market share for 2012 Q3. (2012 share is expected to come in at 53.8%, source: IDC.)”

“Thinking back to the launch of the iPod, could it be the iPad (and tablets as a whole) will mirror the consumer purchase dynamics seen with MP3 players?” Shamblin writes. “Note, over the past 10 years, according to Apple, the iPod has been able to maintain a 70% market share.”

Shamblin writes, “A key competitive advantage of the iPad is Apple’s ability to market a clearly understood and seamless content solution for its tablet devices; a competitive advantage Apple has exploited in the past with its MP3 players. As long as the iPad is perceived by consumers to be the best and easiest source for online content; investors can expect to see iPad maintain it’s position as the #1 brand in tablets and thus continue to see substantial revenue growth in the tablet space through 2016.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Mark Townend” for the heads up.]

22 Comments

  1. Maybe yes. The iPod was definitely a smaller market and tended toward a younger demographic. The iPad on the other hand is a much larger market with more mature people making the decisions. Adults tend to buy on price and spec’s, younger people tend to buy on emotion and how well a product meets their desires, which is right up Apple’s alley.

    It’s the reason why so many people buy Android tablets and have been disappointed. They didn’t really know much about using them and bought based on price and spec. Looking at an iPad and the host of wannabe’s there is virtually no difference discernible to the eye.

    Unfortunately the very large market that is the tablet will be purchased by older buyers who will decide mostly on price. If Apple isn’t price competitive, it will not be able to hold onto the market share it has today.

      1. If say in the world if technology, it’s about right.

        In my experience older people tend to be more likely to buy junk tech. I can’t tell you how many 50 year-olds I know who bought an Android phone, a PlayBook or a Kindle because they were cheaper, then tell me they don’t understand what all the fuss is over smartphones & tablets — saying that they’re not all that useful. Or that they cant use basic functions on an Android phone. They sort-of shrug their shoulders and say they were just as happy before.

        How many 20 year-olds bought a PlayBook over an iPad, even when they were giving them away?

      1. Agreed, but Android will eventually close the gap, like windows 95 did. That’s why companies like Apple have to always be bringing out a product that cannibalizes their existing line, because eventually and inevitability it becomes a race to the bottom with the Asian knock-offs.

    1. Your last sentence doesn’t make sense to me, please elaborate on Apple being price competitive? I’ve never seen their prices gravitate to bargain bottom android type pricing in all their years in business and I wouldn’t expect them too in the future either.

  2. Chaz, you are apparently not familiar with age demographics particularly with respect to price sensitivity and brand loyalty.
    Your original assertion (that you construct the rest of your argument on) is flat out wrong. Younger demographics are MORE price sensitive and FAR LESS brand loyal. (and non coincidentally they are also much less able to afford what they believe is the “best” (in a good better best sense))

    So basically NO, no to your original premise and also to all of the extended constructs you attached to it.

    1. It’s not brand loyalty, it’s about emotion and being envied by their peers. We all understand their economic circumstances, but who was the target audience for “designer” jeans. I’m done arguing with a fool.

      1. Ah I see, middle age people don’t respond to expensive branding. Have you ever been in a high end (mens or womans) clothes store? If you think your sneakers & jeans are pricy (and brand marketed), wait till you grow up and start buying real clothes and shoes.

      2. I’m not so sure about that. I almost think it’s because a lot of older people almost can’t believe the phone company would sell you junk.

        “The kid at the X store told me this was a cool phone, and it was so much cheaper than that iPhone you told me to buy — now how do I make this thing do something useful? And why can’t I listen to my messages with it?”

  3. Note: “… a 50.4% market share for 2012 Q3” is prior to the iPad mini and these people are counting those e-readers. What was the iPad’s real market share with full size tablets? That is a much higher number!

    1. And what’s the use-share?

      We’ve seen numbers as high as 95%.

      A lot of the competing tablets are ending up in a drawer somewhere. The iPads are getting used.

  4. I’ve always stated that the iPad market will follow closely along the iPod market share. Why? These types of devices are not necessities – they are conveniences.

    The iPod didn’t enable me to do something I couldn’t do before, it just made a little more convenient by allowing me to carry so much music in my pocket and making it extremely easy to do so.

    The iPad is the same here. I could just carry a laptop or a smart phone to do the same things. The iPad made it much more convenient to do some of them; the screen was bigger than a smart phone and it was more mobile than a laptop. It was also dead simple to search for, download, and install apps, and other content. The iPad has an even bigger advantage over the iPod though… There is already a solid platform built around a viable ecosystem.

    Anyone who buys any other tablet is going to find a less convenient experience and therefor will not see the benefit of having such a device. This is evident by the fact they only selling well during the Holiday season, when they’re purchased as gifts – no one is buying them for themselves.

  5. iPods never had a place in the education market. iPads do, and despite the difficulties in managing them on a large scale, schools are adopting massive numbers of them. To my knowledge, very few schools are using any other tablet.

  6. There has been a lot of usage of the term Old v. Young people in this thread. Do the individuals using these terms take into account the following?
    “Old” people designed, developed ,created, and marketed the products you claim are for “Young” people. So can “old” people use those products? Do they understand those products?
    “Young” people have no allegiance to any product on the basis that the source of their spending power is their parents, “old” people! Ask the Gates kids their opinion on what technology they can buy!!
    When a “young” person is employed, their ability to choose a product becomes limited by their wage packet as well as by what tools their employer provides them to accomplish their job. The free choice they apparently had when they were spending their parents money suddenly evaporates to be replaced by hard nosed reality.
    So to cut a long story short, there is a 90 something year old person out there who was on the cutting edge of modern day technology, the pre-cursor to todays tech. They may not be able to think as clearly as they once did because of the ravages of age to the brain or indeed make what we would consider to be rational decisions, but what they are now should never be the basis upon which we base our arguments upon, when it comes to usage of technology through age demographics. I would not accuse a toddler of using a VTech computer instead of a MacBook Pro in as much as I would not accuse an elderly person for using a telephone handset with extra large numeral buttons to facilitate easy dialing.
    So please think carefully how you place your views out there, there is a very large & diverse World of people out there to take into account off.

    1. Wow, just wow.

      Go spend an hour @ best buy. What age demographic walks in and looks for a sales person to explain what various products on display do or how they work, or what is the best smart phone to buy.

      Big Part of it is time. People heading up families and living independently have a lot less time to explore and understand technology.

      1. Actually, we produced (post) a training series for a large electronics retailer and were privy to some of the (rather extensive) observation and polling they had done in order to design the content. I can tell you that even though this client was not best buy, it is similar in scope and size and their (observed) results are just about reversed from what you “suppose” is the case (as is often the case: what we think we know as uninvolved and non observant third party is very often completely wrong) Even though their sales demographics was slightly skewed to the lower age categories (vs general population) the people who were interacting with their sales associates (for product selection advice and assistance) were very heavily skewed to the younger demographics.

  7. I have problem in believing the market numbers. The top Android tablet makers ( Amazon and Samsung) don’t report their numbers. When Samsung had to in court is was dramatically lower then was predicted. I don’t remember the numbers however it was something like 30,000 instead of 1,000,000. Every one, even Apple fanboys, had to rethink the market. If tablet makers were doing anything near iPad they would be flaunting their numbers. Not just proving they are beating Apple, but other Android tabs as well.

    Most people look at the consumer market, however Apple has made a strong push in education and business. Amazon is trying to get in Education, but basically textbooks. Nothing like iTunes U. The players that would be strong in business BB and MS are not even in the game yet. One of the main reasons MS did well in PCs was consumers got them because it was the one they used at work or school. Not that they were “open”. This will be a big factor in keeping iPad at the top in the coming years. IMHO iPad will be not be a repeat of iPod but a repeat of PCs.

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