Tablet PC Sales Surge

For some strange reason, research firm Comscore measures tablet PC sales in relationship to smartphone activity. Each is quite different from the other, based on screen size and resolution and computing power alone. Comscore’s largest poll on tablets draws the same conclusion everyone else has. Sales are widely popular because the devices can be used so readily for features usually found on PCs, but the tablets are completely portable. Whatever success tablet sales have had, it is only a beginning, perhaps. It also could be an example of how Apple (NASDAQ: AAPL) has created the market with its iPad, and that the market will not expand much beyond sales of that product.

Comscore reports that:

[T]ablets have quickly reached a critical mass in the U.S. with 1 in every 4 smartphone owners using tablets during the three-month average period ending April 2012. The study also found that tablet users were nearly three times more likely to watch video on their device compared to smartphone users, with 1 in every 10 tablet users viewing video content almost daily on their device.

It is a wonder that consumers use smartphones at all to watch video. Small screens undermine their usefulness, particularly for longer form video, which often costs the user money. Comscore reasons that tablet users are more likely to be smartphone users than they are people who carry less fully featured handsets. That could be because smartphones are relatively expensive, as are tablets. Or people who carry primitive handsets do so because their interest in mobile computing is limited.

Comscore offers support for the notion that higher-income Americans are more likely to use tablets than lower-income people because of the expense of the devices:

Tablet users also skewed towards upper income households, likely a function of the high price point of these devices still considered a luxury good to many consumers. Nearly 3 in 5 tablet users resided in households with income of $75,000 or greater, compared to 1 in every 2 smartphone users.

That is a perfect example of a statement of the obvious.

What is not as obvious is the role that Apple’s iPad will play in future growth of tablet sales. The iPad holds the lion’s share of the market. The iPad 2 has sold better than its predecessor. There will be an iPad 3 and probably an iPad 4. The tremendous demand for the Apple products have kept competition out of the market. Samsung, Apple’s major rival, has barely made a dent in Apple’s share with its own tablet. The market is littered with other attempts to take some of the market from Apple, including efforts by Research In Motion (NASDAQ: RIMM), Dell (NASDAQ: DELL) and Hewlett-Packard (NYSE: HPQ)

Early tablet adoption could be the start of the next generation of computing. Or, it could simply be an example of one more Apple runaway success.

Douglas A. McIntyre