No, Apple’s iPad is not losing the tablet war

“Apple has gotten many such bear arguments lately – with the sole focus on market share of some total product industry categorized by some third party or analyst, leading to the assumption that Apple is in a desperate state quickly losing market share of some rapidly growing industry. In actuality, most of such market share arguments are entirely flawed,” NYC Trader writes for Seeking Alpha.

“Let’s take IDC’s market category of the tablets for example,” NYC Trader writes. “A simplistic assumption is made by IDC that all tablets should be placed in the same one category – tablets – and with the iPad’s premium pricing, this general assumption inevitably places the iPad at a market share disadvantage to peers – because Apple’s tablets only appeal to individuals whose affordability levels allow them to purchase premium products.”

“Apple still has an enormous unfulfilled smartphone market opportunity in China (when, for example, additional China networks become compatible with Apple’s 3G/4G capability),” NYC Trader writes. “China currently has a population of 1.35 billion. In 2005, 32% of China’s income share was held by 5% of China’s population and 48% was held by the highest 20% of the population. This suggests that the majority of China’s population will not be buying Apple’s premium products and would prefer to buy cheap knock-offs or heavily discounted, lower margin, bottom-tier products. Apple can live with that. Let me rephrase that. Apple prefers to live with that. Apple’s focus is not on the 80% who can’t afford premium products. With their #1 global brand, Apple does not need to heavily discount its products to appeal to the masses. Instead, Apple would prefer to appeal to that 20% of China, or people looking to buy premium products.”

Read more in the full article here.

MacDailyNews Take: “Apple’s focus is not on the 80% who can’t afford premium products. With their #1 global brand, Apple does not need to heavily discount its products to appeal to the masses. Instead, Apple would prefer to appeal to… people looking to buy premium products.”

Android can have the Hee Haw demographic. Apple doesn’t want it or need it; it’s far more trouble than it’s worth.MacDailyNews Take, November 26, 2011

Related articles:
Apple iPad’s share of tablet market hits new low since market share is not Apple’s goal – October 31, 2013
Apple will continue to ignore Android market share stats all the way to the bank – October 29, 2013
Newsflash: Apple sells premium products at premium prices to premium customers – October 23, 2012

54 Comments

        1. Not too sure why Apple is still selling the 16 gig iPad Air or iPad Mini Retina. Most users are requiring and asking for more storage, not less. Tim Cook should just this one time do what Steve Jobs would do; drop the 16 gig and start all iPads with the 32 gig as the entry level model. Go Apple and can’t wait for the 32 gig Mini to go on sale this month.

        2. Take it or leave it, no one was trying to ‘ disprove’ your point.

          If you ever experienced trying to get cheaper RAM from third party vendors, you probably know that it doesn’t compare to Apple’s matched and certified advantage.

          Most who have tried alternatives , realize that it doesn’t pay to be cheap – it’s too expensive.

        3. Don’t listen to breeze Chuck. He’s the biggest Apple cocksucker there is, bar none.

          It’s a bunch of hooey that Apple packs the best RAM in their equipment. Hooey. You can get third party RAM from a variety of manufacturers, e.g. Samsung, Crucial, Toshiba, Hynix, any number of quality manufacturers.

          Apple sources their RAM from these very same manufacturers too. If third party manufacturers can sell RAM for a fraction of the price Apple charges, then you know you’re being put in a world of hurt by Apple’s outrageous prices.

        4. You should know that Apple doesn’t buy memory for new models on the spot market, which is what you do with you decide to upgrade RAM on one of your computers.

          They have to contract to buy some large amount of memory months in advance of product release, sometimes a year or more, and may not be able to benefit from price drops of some new type memory after it’s been in production for months.

    1. The only thang I can say is my wife has the 1 st iPad and it’s running great and I just got here the new air yesterday,
      Woo ow you will love it,
      I’ve have nothing els in my house but Mac and if you don’t like the new air??
      Window or window based suck, if they were any slower.

  1. MDN,
    Let’s hold off on the “HeeHaw” demographic talk. It belittles you.

    I’ve been a long time Apple owner since the first 128k Mac, and have owned every product and loved everyone of them. I’ve always been in the “why would you have anything else” camp, but for the first time last week I was walking through Best Buy and saw row after row of 15 inch laptops from Dell, Samsung, Acer etc., all between $299 and $499.
    Even knowing all I know, it’s understandable how anyone could be tempted by such a great deal on what looks like so much hardware. I know it’s wasted money, but I don’t think someone trying to save a buck in these hard times should be considered “HeeHaw”. Uninformed, maybe, or just unable to part with the high cost of what is probably not a critical purchase.
    If you need the tablet for work, or serious production, you skimp and save for an iPad. If you choose to give your 12 year old a Samsung to watch movies, that doesn’t make you a hillbilly – It might make you the savviest consumer out there.

    1. You only want MacDailyNews to “hold off on the ‘HeeHaw’ demographic talk” because it belittles you. You’re obviously firmly ensconced in the middle of said demographic.

      Go try to sell Kias to BMW owners somewhere else.

        1. You’ve got that right! The BMW product currently hanging around my neck is the least reliable, most expensive to maintain piece of junk I’ve had in 50 years of car ownership. Indeed, a Kia would be a quantum leap up for me. BMW, never again!

          1. It’s understatement to say luxury cars aren’t exactly known for their frugal total cost of ownership. That’s not why you buy a luxury or luxury sports car – German or otherwise. Is this news to you?

            The Kia may be more reliable and less expensive, but those are precisely the ONLY two areas in which the Kia would be better. Go drive the Kia daily for a year or two and then let me know how you feel about the interior fit/finish, materials, comfort, noise, road feel, handling, performance, and a host of other metrics.

            I’m curious… What BMW product is it that’s currently ‘hanging around your neck’?

            1. Thanks for letting me in on the “news” with your supercilious remarks. Yes, this car is fun to drive, at least when it’s home from the shop (unfortunately, it spends an inordinate amount of time at the dealership…it is there as I type and has been for several days). BTW, this might be news to you, but not everyone buys a luxury car to parade his or her wealth (it might be easier just to pin your W-2 to your lapel).

            2. Sorry, I didn’t mean to be snarky, but I’m an auto enthusiast; I’ve read the articles for years, and I’ve heard the stories over and over, so it always catches me off guard when people are surprised that their German luxury car has to be in the shop a lot or that it’s expensve. They don’t call it the “stealer” for nothin’.

              I’d say most people who drive luxury cars don’t do so to parade their wealth. Rather drive them because that’s what they want to drive, and nothing more.

              You still didn’t answer what it is that’s in the shop. Year, model, and miles would add some value to the discussion.

        2. There was a time when a Jaguar and a Rolls were “the best” now they are just luxury and far from the best. The new Kias look great and as a daily drivers they are perfect. HarleyDavidson is far from a great motorcycle but it is a status symbol for certain people, the list goes on. If Apple decides to go the Jag or the Rolls it will most certainly be the end for them.

      1. Superior Being… so cute of your and your little assumptions.
        I could have elaborated even more when I gave my computer history, including owning 80% of Macintosh models ever produced, staffing and equipping 3 high end digital retouching studios, spending over $35,000 on RAM alone on a PowerMac 9500 in 1995 – because that’s what you had to do to be at the top of the creative talent pool, having more ‘cheese grater” MacPros sitting in closes than I can count, owning every version of iPhone and iPad produced, and currently making more money on set with my MacBook Pros than I really need to tell you about. If you want to talk cars….. that’s for another post.

        But I didn’t think you needed to read my curriculum vitae in order to hear my point of view. I simply said that even though we all are Apple evangelists, and here for that reason, we shouldn’t stick our heads in the sand about the situations of others. Just because something is the best, doesn’t mean you’re a fool if you don’t buy it.
        Assuming that people who shop a Barneys are sophisticated and those who grab a deal at Cosco are unwashed hicks does not show your superiority, it shows your ignorance.

        “Know your enemy and know yourself” Sun Tzu

        1. The point is simple:

          Once you make the wrong choice, the cheap choice, you disqualify yourself from being the type of customer Apple desires. Your choice proves that you are far less likely to buy apps, buy peripherals, patronize ads, etc. You are a member of a demographic that is less desirable to Apple. “Hee Haw demographic” is simply a nicer way to refer to those too poor and/or ignorant to be worth pursuing.

    2. MDN occasionally can’t resist being obnoxious and as arrogant as Microsoft. See any MDN comment related to John Sculley. You clearly are an Apple enthusiast, yet look at the first reply to your message and you will see the obnoxious mindset that makes people dislike Apple loyalists. I too have had Apple since forever and own a lot of stock. At the same time I don’t think the best way to convert people is to start by calling them ignorant morons.

    3. You obviously do not understand total cost of ownership(TOC). That $299 laptop will end up costing a lot more in the end. So even with a premium price, Apple hardware is the way to go. Most of this hee-haw category will always be fixated on the cheapest thing out there. And you cannot change that. It is what it is. There will always be a Walmart demographic now matter how well you try to explain TOC.

    4. I agree. I’m on my third iPad. I have a Mac Mini and an iMac. I’m on my fourth iPad touch. But I don’t have, need or want an iPhone. I pay $80 a month for home phone and WiFi. But my cel phone is a Nokia that cost $9 and has a $7 a month fee. I call people on it and people call me on it. Why spend more just to strut around with a cool gadget?

    5. I agree. I don’t consider myself part of the Hee Haw crowd, but why belittle someone because they’re from the south, and believe in god, guns, and country? I just purchased a new iPad Air. I’m lucky to be able to afford one. I feel sorry for those who can’t.

      I just retired my Kindle I got for free when I signed a contract with Optimum Cable. It was small, slow, not the best resolution, and stuck with second rate apps. Compared to the iPad, it’s bear skins and stone knives. But for email, web, and reading books and magazines, it’s adequate.

      Maybe use working class or blue collar, which aren’t denigrating terms. Hey, some of these people may splurge for an iPad when they get their tax return or a bonus, so why would we want to alienate this demographic? Better to educate these people on the merits of spending a bit extra for a tablet. No matter which group your from, everyone likes, want, and respects quality. Point out things like resale value, speed, screen resolution, availability and quality of the Apps, and so on.

      We shouldn’t outright dismiss blue collar and working class people. We should help them make a choice they will eventually be glad they did. It’s actually a pretty easy sell. I tell clients to go to Best Buy because it’s one of the few places you can do side by side comparisons of the iPad and other tablets. Once people see the differences in weight and quality, they’ll be willing to put a bit more on that charge card. But telling these people the iPad is only for elitest, we’ll to do people isn’t very professional or politically correct. Why would we want to alienate a potential client?

    6. I agree. Having worked as a salesman for nearly 40 years, I can assure you that you earn far more money by avoiding denigrating cliches. My career has allowed me insight into buying behaviours. Not everyone is ready for a BMW/Audi/Merc or even wants one. You gain nothing by spending time on them to convince them. And you sure as hell convince them to never ever buy one if you insult them.

    7. Amen brother. I tool am a longtime Apple using and it’s time for me to upgrade my MacBook Pro and just can’t bring my self to eat another $1,500-$2,000 just because “it’s time to upgrade”. That said, I have only owned an iPad (3rd generation) for about 3 weeks before goiong back to my Android tablet and last year after using an iPhone for 3+ years switched it to Android. Apple makes amazing products but there are other company who have narrowed the gap and “believe it or not” surpassed Apple in some areas other than just price. I love Macs but I way prefer Android to iOS.

  2. Rant. I really can’t figure why Google entered the phone or the tablet market. Genuine Apple products produce far more revenue per device for them, and sticking to their strengths would save them development costs on software for me-too knock-offs, which have filled out the ‘tablet’ market (including products for the so-called hee-haw demographic) thereby losing billions on what they’d get if they’d left the competing to MS and Samesong.

    1. The entered with Android because they realized they COULD knock Microsoft out of the mobile market.

      Their mistake was forgetting how valuable the Apple User market is. At this point they just need to agree with Apple to link web search results to optionally allow Apple maps default display instead of Google Maps in exchange for the reverse: in Apple maps search to allow default option to Google instead of Yelp.

    2. Advertising. Gathering info from people who purchase their products. Tracking their locations and buying habits to be able to charge agencies more for the info to better target customers.

      Remember, purchasers of Android products are not Google’s customers. They’re the product. Advertisers are their customers.

      1. Yes, one reason why I am an Apple customer is that Apple treats me as if they KNOW I am their customer. Since the purchase of my iPod (classic, when it wasn’t a “classic”), throughout the 3g, 4s,5s, iPad 1, and iMac the customer service I have received from Apple has been excellent.

  3. DTKreutz made the same observation that I did while walking through Best Buy yesterday. I was there to look at the iPad Air and could not help but notice two other display tables (Samsung tablets and MS Surface) that were twice the size of the iPad table. And filled with twice as many people.

    I am not advocating that Apple get into the low end….but they need to be very aware of the value equation.

    Recently retired and living on a fixed income I am very aware of this in other items. While I would never go back to MS (being retired, I don’t have to deal with that anymore), the value equation still applies. People with limited cash will choose the lowest price that fits their needs. Needs which may not be the same as yours and mine. If the primary need is for watching movies and playing games…the Samsung tables with the 16:9 screens actually add more value in their eyes.

    Remember when digital cameras were a HOT item and expensive? Today they are commodity. Even the cheapest one takes pictures good enough for the masses. Tablets are headed that way.

    Agreed, you cannot sell Kias to a BMW owner. But by the same token, you cannot sell BMWs to someone who can only afford a Kia.

    1. I just bought a digital camera for $2000 dollars. Many wish they could afford one like mine. People with trashy commoditized digital cameras want my last USED digital camera for $600, people with trashy commoditized cameras are alway asking me to fix their stuck shutter button, or stuck lens motor or stuck lens protector. I tell them to throw it away and get a real camera.

    2. Where are you from in my local nj mall the Surface booth has 5 people ther all
      Employees, as for android they have $49 tablets why should that count as marget share it might as well be a leap frog, a toy. And Best Buy is not apple friendly. If you want see who apple sells to go to a apple store, it’s every one they good to Quality somthing that last. My parent live in the country every other person has $35,000 pickup truck it were you to put your money.

  4. I watched this fool, he makes statements without actually doing the test properly.

    I don’t get any skipped frames on my Air because I have allowed for the so to boot up more than once. The FIRST boot up is always atypical.

    Watch this fool change his mind in a few days in typical Prillo fashion………..”remember when I said the Air dropped some frames…..seems I was jumping the gun….my wife couldn’t repeat the same experience…..and you know what? She was right…neither could I. Don’t know what happened….we’ll there you go…..Color me dumbfounded.”

    You have to say the above in a Prillo voice and then it all fall in place.

  5. When I explained the “benefit” of having a retina MBP, an anti-Apple zealot suggested my comment was hyperbole at best.

    The reality is, most people are satisfied with “good enough,” either because that’s all they can afford, all they want to afford, or have never “tasted” premium quality.

    Let the “good enough” crowd enjoy their half-assed quality Android and Windows crap.

    And, as I pointed out to that same guy, I view any person wondering why someone would want amazing sex in the same manner (if not more so). If you’re wondering what the big deal is, YOU’VE NEVER HAD IT! 😛

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