Australian tablet sales drop 20% in 2014 as wearable computers start to become popular gifts

SYDNEY, AUSTRALIA – Australian’s appetite for media tablets decreased by 20 per cent in 2014 as a cyclical slowdown affected the market, according to a new study from emerging technology analyst firm Telsyte.

Apple reclaimed the market leader position in the second half of 2014, making up nearly half of all unit sales from July 1 to December 31. However, only Windows tablets saw a year-on-year increase in unit sales amid growing consumer interest in smart wristbands and smartwatches during the same period.

Telsyte believes the slowing demand was mainly due to saturation in the iPad and Android tablet markets.

Nearly half of Australians who have ever purchased a tablet, did so in 2013, and few found a reason to upgrade their device in 2014. Furthermore, increased demand for the new iPhone 6, new larger screen Android smartphones as well as a range of wearable devices such as Fitbits, impacted tablet sales in 2014.

Telsyte estimates that at the end of 2014 around 13 million Australians, or more than half the population, had access to a tablet. Facebook, interactive games, news and video content were the most frequently accessed applications. Online shopping using a tablet also became more popular in 2014.

Tablet gifting impacted by smartphones and wearable devices

Telsyte Senior Analyst Alvin Lee says low cost tablets purchased as gifts have lost their appeal and more consumers are now 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,” Lee says.

Telsyte expects wearable devices such as Microsoft’s HoloLens and Samsung’s Gear VR to also 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 says.

New tablet market growth driven by Windows notebook upgrades

Telsyte predicts the market will bounce back in 2015 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.

Telsyte Managing Director, Foad Fadaghi, says computers remain the preferred device for the creation of documents and media editing.

“Telsyte believes there will be strong demand of convertibles or 2-in-1 devices, as mainstream business and consumer users look to update to Windows 10 later this year,” Fadaghi says.

Despite their massive 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.

For further information on the study or media inquiries contact:

Foad Fadaghi
Managing Director
Tel: +612 9235 5851

Alvin Lee
Senior Analyst
Tel: +612 9235 5890

About Telsyte’s Australian Media Tablet Market Study 2015

Telsyte’s Australian Media Tablet Market Study 2015 is a comprehensive study which provides subscribers with:
• Tablet market sizing, platform and vendor market shares and forecasts
• End user trends across devices, services and mobile media
• Purchase intentions
• Product reviews and insights
• Tablet audience estimates for media companies

* Telsyte defines convertible tablets (or hybrid tablets) as Windows 8 or later portable PCs that have a touch screen and detachable keyboards, or a foldable form factor which can provide a pure media tablet like experience. E.g. Microsoft Surface or Lenovo Yoga 3 Pro. Touch screen notebook PCs are not measured in this study. Devices with screens under 7” are not measured in this study and are considered Phablets.

In preparing this study, Telsyte used:
• An online survey of a representative sample of Australians 16+ years of age conducted with 1,251 respondents in November 2014.
• An online survey of a representative sample of Australians 16+ years of age conducted with 1,009 respondents in February 2015.
• Financial reports released by mobile carriers, manufacturers and service providers.
• Interviews conducted with executives from mobile operators, vendors, retailers, and channel partners.
• On-going monitoring of local and global market and vendor trends.

About Telsyte
Telsyte delivers strategic insights and advisory services to businesses that are producing, or are impacted by, disruptive technologies. Telsyte publishes studies into emerging consumer and business markets and provides custom research and advisory services. Telsyte is a wholly-owned independent business unit of UXC Limited. UXC is an ASX-listed Australian IT services company and the largest Australian-owned ICT consultancy firm with over 2,500 customer organisations in the private and public sectors across Australasia.

The material in this article is copyright protected and not intended to be altered, copied, distributed or used for any commercial/non commercial purpose, except for news reporting, comment, criticism, teaching or scholarship.