Recently the final numbers for Apple in 2014 arrived, showing a significant drop in the company’s iPad 3 sales. However, Apple’s sales overall are up. Does this mean that Apple is abandoning iPads to focus on its iPhone line? The numbers seem to tell this story.
Apple’s tablet sales dropped year over year from 32.6% in 2013 to 26.1% in 2014. Looking at sales from June through September of last year, Apple didn’t reach the 13-million iPad sales experts predicted for that quarter. Instead, the company sold only 12.3 million tablets in the third quarter of 2014, compared to the 14.1 million in iPad sales in the same period in 2013.
According to financial experts such as Business Insider, data shows that the iPad line is on a slow decline that will continue if Apple doesn’t make an assertive effort to change the trend.
Beyond the Numbers
Looking beyond the numbers it would appear that Apple is switching gears from iPads to iPhones. The newer iPhones have many of the same features as the iPad2 and iPad 3. In addition, a study by Pocket shows that as consumers purchased iPhone 5s, iPhone 6 and iPhone 6 Plus they spent progressively less time on their iPad tablets.
Apple doesn’t need to sabotage its own tablet line to see a drop in sales. Tablet sales in 2014 were down across the board, as Asus and Samsung saw a significant drop in sales. However, less expensive tablets from companies such as Lenovo saw an increase in year over year sales of 41%. Whitebox increased their tablet sales by 27% and the Others designation saw a rise in sales of 41%.
Brand recognition isn’t enough to bring people in and convince them to buy the latest tablet. Competition in the tablet market is stiff now, with smaller players offering competitive tablets at a better price. Apple’s high price tag and few features compared to other tablets are driving many consumers away now that they have alternatives.
A Different Beast
Another perspective on the Apple tablet decline is that the tablet industry is different from the smartphone industry. People are unwilling to purchase a new tablet every six months or once a year because it is a significant investment compared to a new phone.
With all of the specials generated by mobile plan companies, consumers can obtain a new iPhone for a few hundred dollars if they are willing to shop around or switch plans. Comparatively, the price for a new iPad begins at $400 and is often more than that depending on the desired features.
The cost of a tablet versus a smartphone is one of the main arguments for the decrease in tablet sales in 2014. People are still using their old devices and see no need to buy a new one immediately. The tablet market itself is still in its infancy, so it may take a few years to understand the life cycle of these devices.
Apple’s update support could be the reason no one is upgrading
The idea that people still love their old tablets is definitely true when it comes to iPads. Localytics’ research showed that iPad 2 was still the most popular Apple tablet in 2014. The 4th generation iPad held only 15% of Apple’s tablet market, and the iPad3 had 13% market share.
One of the reasons Apple’s tablets are still in use is because the company strives to keep its products useful and up to date. Therefore, while there may be an initial higher cost, owning an iPad can be considered a better long-term investment when compared to Android and Window tablets.
What could this mean in terms of sales? It is possible that Apple’s sales aren’t in a decline; they are simply leveling off to a sustainable level.
Apple does understand that it needs to make changes in its iPad line. This is why they are working with IBM to make its 12-inch iPad more viable for business users. Moreover, Apple CEO Tim Cook appears to still be invested in making tablets. He has been quoted as saying that he believes the 12-inch iPad should help to improve Apple’s tablet sales.
What do you think? Is the price tag for the iPad line worth it? Do you think that as Apple improves its iPhone lines the company will phase out its tablets?