2-in-1s set to dominate Australian tablet sales

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SYDNEY, AUSTRALIA – The Australian tablet market continued to transition towards 2-in-1s or computers that can either function as a slate or traditional laptop form factor, according to new research from Australian emerging technology analyst firm, Telsyte. 

 The Telsyte Tablet Computer Market Study 2019-2023 found some 1.44 million tablets were sold in the first half of 2019, down 2 per cent from the first half of 2018. Apple remained the leader in tablet sales share (iOS 53.4%, Windows 27.4%, Android 17.6%, and others: 1.6%) with sales of Apple and Windows-based tablets both increasing (5% and 3% respectively) in the first half of 2019 due to iPad mini upgrades and growing demand for 2-in-1s. Sales of Android tablets were down 28 per cent over the same period.

 The top three vendors during the period remained Apple, Samsung and Microsoft.

Sales of the smaller 8-inch tablet form factor saw a “mini boom” in the first half of the year (up 16% from 1H18) due to the release of 2019 iPad mini, which was last released in September 2015.

On the other end of the spectrum, interest in high-end 2-in-1s has increased the average cost of tablets by 17 per cent (to over $800) from a year ago.

According to the Telsyte, the overall tablet computer category will likely experience modest demand in the second half of 2019 through to 2020.

Telsyte forecasts around 1.5 million tablets will be sold in the second half, a decrease of 5 per cent on the same period last year. Telsyte expects similar trends to continue into 2020 due to prolonging replacement cycles, and other devices such as 5G smartphones and wearables taking a greater share of consumer electronics spending.

Versatile 2-in-1s cement their place

The 2-in-1 category is expected to continue growing as manufacturers position their products as replacements for PCs and focus on the business and education sectors.

Telsyte found nearly 4 million (3.9M) Australians are now using a 2-in-1. While Windows still dominates with 65 per cent share, Telsyte expects the share of 2-in-1 iPads to increase with the expanded range of new iPads which support Apple’s ‘Smart Keyboard’.

Furthermore, the new iPadOS brings iPad closer to a complete “PC-Like experience”, with better multitasking and external hardware and network support features.

“The slate-only format is rapidly being replaced by 2-in-1s as Australians seek to replace older laptops and tablets with converged touchscreen devices with keyboards,” Telsyte Senior Analyst, Alvin Lee says.

The replacement period of slate-only tablets (non 2-in-1s) has increased close to 20 per cent in the last 12 months to 3.2 years, compared to 2.6 years for 2-in-1s, according to Telsyte’s research.

Apple remains the leader in repeat purchase intentions, followed by Samsung and Microsoft (Greater than 85%, 75% and 60% respectively).

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High-speed connectivity to drive tablet sales

 The continued improvement of wireless connectivity, such as 5G, Wi-Fi 6 and eSIMs, are expected to drive future tablet upgrades.

Currently there are around 10 tablets and 2-in-1s with eSIM support from manufacturers such as Apple, HP, Lenovo, Microsoft and Samsung. Telsyte anticipates this will increase substantially over the next 24 months.

 Telsyte’s research found around 1 in 6 tablets purchased were through carrier channels and just over two million tablets are connected to mobile networks.

 “Mobile connected 2-in-1s are ripe for growth in the coming years as carriers look to increase network utilisation beyond smartphones”, says Lee.

 According to Telsyte’s latest research, 2 in 5 Australians are interested in connecting their tablets to mobile networks especially if it can be connected using a mobile data sharing plan (46%).

 Smart displays replacing docked tablets in Australian homes

 Australian households are seeing an expanding range of smart speakers and smart displays (speakers with screens) available through retail channels.

 Telsyte estimates that 1 in 5 Australian households are now using at least one smart speaker at the beginning of July 2019, up from 16 per cent in December 2018.

 Among these, close to 10 per cent are now using smart displays, such as the Google Home Hub, Amazon Echo Show and the Lenovo Smart Display.

 The smart display installed base has doubled from six months ago. The smart screen category is beginning to converge with a growing interest in smart homes and demand for visual displays that support voice commands.

 “The popular smart display category gives tablet vendors the opportunity to tap into the fast growing IoT@Home (smart home) market that was already worth over a billion dollars in 2018”, says Lee.

For further information on the study or media enquiries contact:

 Foad Fadaghi
Managing Director
Tel: +61 2 9235 5851
Email: ffadaghi@telsyte.com.au

 Alvin Lee
Senior Analyst
Tel: +61 2 9235 5890
Email: alee@telsyte.com.au

 The Telsyte Tablet Computer Market Study 2019-2023 is a comprehensive study which provides subscribers with:

  • Market sizing, platform and vendor market shares and forecasts

  • End user trends across devices, application usage, platforms, channels and accessories

  • Tablet and computer purchase intentions and loyalty

  • Tablet audience estimates

  • Strategic analysis of market trends and issues

In preparing this study, Telsyte used:

  • Telsyte’s mid-year consumer survey conducted in July 2019 with a representative sample of 1,026 respondents, 16 years and older.

  • An online survey conducted in November and December 2018 with a representative sample of 1,025 respondents, 16 years and older.

  • Interviews conducted with executives from manufacturers, service providers, network operators, retailers, financial analysts and channel partners.

  • Financial reports released by service providers and manufacturers.

  • On-going monitoring of local and global market and vendor trends.

  • Analyst reviews of leading tablet devices.

Editor’s note:

 Tablet definition:  A computer device consisting of a 7 inch or larger touch screen that can be used in a slate format (not requiring keyboard or mouse). Telsyte’s definitions includes 2-in-1 devices with detachable or foldable keyboard, and tabletop, or reclinable desktop screens that provide a tablet form factor experience.

 2-in-1 definition: Primarily refers to laptops that have a touch screen and detachable keyboards or foldable form factors to provide a pure tablet-like experience. Tablets that are known for their versatility and mimic laptop-like experience with keyboards or type covers are also considered as 2-in-1s. E.g. Microsoft Surface tablets, iPad Pro, Samsung Galaxy Book, HP Spectre x360, Asus Chromebook Flip 2, or Lenovo Yoga 730.

 Please note Telsyte measures Apple iPad models that support the specifically designed Apple Smart Keyboard (typically sold together) as 2-in-1s for comparison reasons. This include the iPad Pro series, iPad Air 3rd gen (released in March 2019) and iPad 7th generation (released in September 2019). 

 Telsyte measures sales of devices (“sell out”), not shipments or sales to retailers or carriers (sometimes called “sell-in”). Telsyte believes this is a more accurate measure of performance of products in a marketplace. Telsyte does not rely on disclosure from vendors or general assumptions made for large multinational companies that do not release local market data. Telsyte uses a comprehensive methodology that includes surveys of consumers, discussions with vendors, carriers and their partners, retailers, and financial analysts. In addition, public financial results from manufacturers and carriers are used.  Telsyte tests a wide range of products in real life usage scenarios and conducts satisfaction and repeat purchase surveys with large and representative samples of Australian smart device users. Telsyte is a pioneer in measuring and reporting smart device sales in Australia and has been providing insights on mobile technologies since 2006.

 About Telsyte

Telsyte is Australia’s leading emerging technology analyst firm. Telsyte analysts deliver market research, insights and advisory into enterprise and consumer technologies. Telsyte is an independent business unit of DXC.technology. For more information visit www.telsyte.com.au

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