Tag Archives: Tablet PCs

Q2 Round-up: New iPad Launch Softens Consumer Slate Sales Slump

With unrivalled insight into the Western Europe ICT supply chain, CONTEXT has been following with interest the evolution of the PC and mobile computing market. In many ways, Q2 saw a continuation of trends, with PC volume sales continuing to fall and consumer tablet demand remaining weak as buyers divert their spending to smartphones.

However, as always, there were some interesting caveats behind the headline statistics, not least the impressive performance of the new iPad launched in March.

Tablets and detachables
It’s true that overall consumer tablet demand remained weak during the second quarter. Shoppers continued to shift their budgets to other technologies that have come to represent the content consumption devices of choice in this market segment. Larger screened smartphones in particular have become popular for activities like writing emails and using apps as they’re always on and close-at-hand for consumers.

However, year-on-year volume decline was softened somewhat thanks to the launch in March of Apple’s seventh generation iPad. The 9.7in tablet is more powerful than the iPad Air 2 but also heavier and lacking several of the latter’s features such as a Smart Connector, and fully laminated, anti-reflective screen. However, its relatively low-price tag seems to have attracted consumers in large numbers and it sold well in Q2.

This is not unusual for Apple products, which often see strong initial sales. But if consumers continue to flock to the model, it would seem to suggest there’s a need for a high-quality iPad option with a price point more in line with current market trends.

Elsewhere, business detachables continued to grow year-on-year in Q2, dominated by Apple and Microsoft products but with Lenovo making impressive inroads. New products such as Apple’s iPad Pro with a 10.5in screen and Microsoft’s fifth generation Surface Pro helped drive this growth. Business detachables still aren’t selling in huge volumes, but it was one of the few segments to post growth in the quarter.

PC Average Selling Prices continue to rise
On the face of it, the PC market overall saw a bigger than expected drop of -15% year-on-year in terms of volume sales. However, there’s more to this trend than meets the eye. For one, Q2 2017 had fewer trading days than the same period last year and some April sales had been brought forward to March in anticipation of rising prices.

Despite weak demand in some segments, the quarter fared better from a revenue perspective, down just -2% year-on-year as average selling prices (ASPs) continued to rise. The growth in ASPs year-on-year continues to be driven by a blend of currency, component costs and a richer product mix; with the shift to high-end models a welcome continued trend.

Weaker-than-expected sell-through meant that inventory levels are a bit higher than desired, but not worryingly so. It’s likely that the “back-to-school” period will be used to get rid of extra stock, driving a reduction in pricing quarter-on-quarter.

by MCP

 

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Filed under Enterprise IT, IT Pricing, Mobile technology, PCs

Tablet PC sales: growth opportunities for retailers

Last week at PCR Bootcamp CONTEXT hosted a panel of experts to debate the future of tablets.

Context1Despite the recent decline in sales of tablets, the panel was universally optimistic about their potential in enterprise. “There is a huge opportunity in B2B verticals and in process improvement” said Phil Northam, head of Knox customisation at Samsung. “We can customise any Android system, we launched this program in April last year and we have significantly grown our revenues.”

Rodric Yates, Mobility Business Development Leader at IBM added “we are just scratching the surface.” But different skills and expectations are necessary “don’t start by trying to sell a tablet – the first thing is to understand what customers need” said Matt Birch, Channel Sales Manager for Intel. “The sell cycle is longer, it is critical to ensure that the device recommended is right for the customer otherwise the opportunity will be lost and the customer will give up on tablet… the OS, the form factor, the app ecosystem or even something as simple as the screen size all have to be right or else they will lie gathering dust on the shelves and people go back to their old devices.”

We heard about many different use cases for tablets – in education, hospitals, fieldwork and a fascinating case of airline entertainment systems from Phil Northam. “We had to take the wifi drivers out and the popup which says ‘don’t turn the volume up as it can damage your ears’. The result was a customised tablet giving an improved customer experience, and a lower cost solution with less weight in the aeroplane and hence massive fuel savings.”

“When you identify the solution it creates stickiness with the customer,” said Matt Birch. All of this is music to the ears of resellers and retailers who asked questions about whether this could be applied to smaller clients. “Come and talk to us” said Phil Northam.

Rodric Yates pursued the theme of listening “we have been accused of throwing technology over the wall, and not consulting the end user to ensure they get value. Listen to the users and build for them what they need not what they want. Don’t replicate the design you get on a laptop and make sure when you are designing that you use the context and capabilities of smartphone or tablet. Put power into the hands of people combining a beautiful front-end with back-end analytics.”

“For a fieldworker you can create an application which answers the question ‘where is my job, do I have the right tools, if I am struggling what are the manuals I need to refer to, can I tap into expertise using social media?’ – in this way you bring all the power together so that you can get the job done.”

In hospitals to avoid the paper flying about, you can answer the question ‘where are the patients, and the beds?’ and bring the right experience for symptoms and contra-indications – you can bring systems together to see the patient as one. Then you can organise who does what and when.

Perhaps we should end with an optimistic note on consumer tablets which still represent the lion’s share of sales “There is still a consumer demand but customers are only able to get some of their computing needs from a tablet so we believe there is a great opportunity for 2 in 1 and also Windows 10.” said Matt Birch.

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Is business usage of Tablets growing?

by Adam Simon, Global Managing Director, Retail Business Development

Business usage of Tablets is expected to increase. With Tablet sales to consumers recently in decline across mature markets, and replacement cycles proving longer than expected, commercial usage is widely considered the next opportunity for Tablet growth.

In the course of last year, a number of vendors have launched Tablets dedicated for use in office environments or targeted at vertical industries such as retail, health and education. And consumer-targeted Tablets, in particular the iPad, have also been used by businesses. During Apple’s last quarterly earnings call, Tim Cook spoke of the importance of business sales of tablets – cynics will say that he would say that, having experienced an 18% YOY downturn in tablet sales, so he has to paint a rosy picture. But recent CONTEXT data supports the assertion of a growing importance of Tablets in business environments.

In Q414, for the top 5 Western European markets combined, distributor Tablet sales into business channels increased Y/Y while sales into retail declined. Sure, business-channel growth came from a small base, particularly in the corporate reseller segment, and multiple retail was still by far the dominating channel with a 69% share. But this was down from last year’s 73%, while business channel share increased.

And while Apple remains the dominating vendor for Tablet sales to corporate resellers, Windows has finally begun to make an impact on the segment. Windows-based Tablets accounted for 11.4% of Tablet sales to the corporate reseller channel in Q414, compared to only 4.5% a year ago.

It looks like Tim Cook is right, and there is a growing market for business tablets. The next big leaps will be when the IBM business apps which are being developed in collaboration with Apple, as well as the launch of Windows 10 later on this year, start to make an impact. CONTEXT will be tracking those trends closely.

 

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Filed under Market Analysis, Tablet PCs