Demand for tablets in Australia dropped 20 per cent last year as the saturated market was further impacted by the entry of larger-screen iPhone and Android smartphones as well as a range of wearable devices.
Analyst firm Telsyte estimates that at the end of 2014 around 13 million Australians, or more than half the population, had access to a tablet. It said that over half of Australians who have ever purchased a tablet did so in 2013, and few found a reason to upgrade their device last year.
Apple reclaimed the market leader position in the second half of 2014 and accounted for nearly half of all unit sales, Telsyte said. Windows tablets saw the only year-on-year increase in unit sales amid growing consumer interest in smart bands and smartwatches.
Telsyte senior analyst Alvin Lee said low-cost tablets purchased as gifts are losing their appeal, with more consumers looking towards wearable devices as presents or to meet their gadget buying urges: “The average cost of a smart fitness band is similar to an entry-level tablet, making it a popular alternative for those who already own a tablet.”
Telsyte also expects wearable devices such as Microsoft’s HoloLens and Samsung’s Gear VR to challenge the role of tablets in a connected-home environment.
“In the coming years, we are likely to see more connected-home apps being developed for wearable devices such as virtual or augmented reality headsets,” Lee said.
Telsyte predicts the market will bounce back this year as Windows-based PC users look to upgrade to convertible or hybrid devices that allow them to run PC applications on a tablet form factor. The firm believes there will be strong demand for convertibles or 2-in-1 devices, as mainstream business and consumer users look to update to Windows 10 later this year.
Despite their strong appeal, Telsyte’s research indicates two-thirds of Australians do not believe a pure tablet device will ever be their primary computing device, a figure that has risen from 56 per cent in 2013.