News

Windows Tablet Sales Expected to Lag iPad, Android

Poor marketing, distribution partially blamed for slow uptake.

• By Gladys Rama
• 12/10/2012

Tablet growth is going to be strong in the near term, says one analyst firm, but it will be awhile before Windows impacts the market.

That's according to figures by International Data Corp. (IDC), which predicts worldwide tablet shipments of 122.3 million in 2012, compared to the previous projection of 117.1 million. IDC also upgraded its tablet forecasts for 2013 and 2016 to 172.4 million shipments and 282.7 million shipments, respectively (up from earlier forecasts of 165.9 million and 261.4 million).

Fueling that growth are the rising demand for tablet devices based on Google's Android OS and interest in Apple's iPad mini, which launched this fall.

"Android tablets are gaining traction in the market thanks to solid products from Google, Amazon, Samsung, and others. And Apple's November iPad mini launch, along with its surprise refresh of the full-sized iPad, positions the company well for a strong holiday season," said Tom Mainelli, research director at IDC, in a prepared statement.

IDC expects Android- and Apple iOS-based tablets to dominate the worldwide market for the next few years. The iPad and iPad mini are projected to lead the way in 2012, with 53.8 percent of the market by year's end, down from 56.3 percent in 2011. Android is expected to be No. 2 in 2012, growing its share to 42.7 percent by year's end, up from 39.8 in 2011. Android's ascendance over the past year is due to the devices' typically lower price points, according to IDC.

Trailing far behind the two market leaders in 2012 is Windows, which IDC projects will claim just 2.9 percent of the worldwide market this year. IDC's figures for Windows include tablets running Windows 7, of which there are are relatively few, and tablets running Windows 8 and Windows RT, which have been on the market since only November. By 2016, IDC projects Windows-based tablets will own a more substantial -- but still third-place -- 10.3 percent of the market.

"Microsoft can't be pleased with these numbers. A mere 10.3% market share by 2016 is very bad news," noted Computerworld's Prestron Gralla. "If true, [it] would show that the Windows 8 experiment of designing a tablet operating system for PCs as a way to get people used to the tablet interface so they buy tablets, has failed."

Windows 8, Windows RT and Microsoft's self-produced Surface tablet are the company's first major foray into the tablet market. Microsoft recently said that Windows 8 upgrade sales are outpacing Windows 7, with at least 40 million Windows 8 licenses already sold. Sales of Windows 8-based devices, however, seem to be a different matter. Reports indicate slowing consumer device sales for Windows products, as well as a poor showing by Microsoft during this year's Black Friday shopping day.

According to brokerage firm Detwiler Fenton, part of the problem, at least for the Surface, is low consumer exposure. The Surface comes in two flavors: the version running Windws RT begins at $499 (without the distinctive touch cover), while the forthcoming Windows 8-based Surface Pro will begin at $899. Currently, it is only available for purchase online and at Microsoft Store locations -- a factor that has hurt its chances for commercial success, the firm said.

"Lack of distribution is killing the product," AllThingsD quoted Detwiler Fenton as saying in a research note this week. "Mixed reviews and a [$499] starting price tag certainly don't help, but lack of retail exposure at Best Buy and others is severely depressing sales."

Windows 8 devices in general have also been hampered by the platform's "awkward launch," according to Nomura financial analyst Rick Sherlund, who is quoted in this Forbes article. Sherlund noted that Microsoft's OEM partners have been slow to bring Windows 8-based devices, particularly tablets, to market.