HOBI Weekly Blog Recap (3/20-23/23)
Tablet sales are declining and fewer tablets are being shipped, so does that mean the tablet has lost favor in the market?
The key barometer for tablets is the venerable Apple iPad, and we have watched its sales decreased five consecutive quarters. The decline in tablets shipments can be attributed to several factors:
- Overall decline in IT equipment market sales
- Overhype when tablets were first released
- Longer lifecycle than cellphones leads to less churn with users
- Popularity of large display cellphones
- Lack of voice connection
Apple is still the alpha dog with an estimated 27 percent market share, which has decreased 6 percent from the original 33 percent just one year ago. This can be seen in the decline of iPad shipments by 23 percent, following suit of the decline of the entire market. Samsung tablets maintained a 20 percent market share. Other large players followed with Lenovo at 5 percent, ASUS at 4 percent and LG at 3 percent.
Always interesting to note the “Others” category at 43 percent. The others include Surface as well as many smaller players. I expect the Microsoft Surface to break out of the “others” category soon and start showing a higher market share.
The Surface Pro 3 platform is priced largely for the high-end business or educational user. The recently introduced Surface 3 comes with a lower price, less robust processor and a smaller screen. The obvious synergy between a Surface and a full service tablet is proving to be very popular.
Penetrating the Enterprise Market
Apple, in an effort, to drive more enterprise applications and sales for its iPad platform, has joined forces with IBM. The iPad product development, particularly in the
iOS, will benefit users with new ideas and features. Apple clearly leads the hardware race with a share of 60 percent but lags behind the Android software with a share of 35 percent.
As tablets penetrate the enterprise market, interest in leasing the devices increases, versus an outright purchase. Leasing companies prefer the two-year term for an operating lease, but a three-year term may fit better with technology refresh cycles. A steady secondary market exists for the major brands, like Apple, Samsung and Microsoft, and the total cost of ownership may be lease when leasing.
Two important end-of-lease issues are data erasure for each tablet and managing the condition of the returned tablets. Tablets in good condition automatically are of more resale value than tablets that are damaged or missing components.
A tablet in good condition has many resale and refurbishment opportunities at the end of its lease. The best way to ensure a tablet stays in its best condition is by using the best maintenance practices throughout its lifecycle.
HOBI is a 23-year-old asset management firm with a focus on managing the lifecycle of cell phones and tablets. We process more than 35,000 wireless devices a month by providing audit, erasure, remarketing, repair and recycling services to carriers and enterprises.
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