Tablet PCs in India have had their share of bull-run for a year. But now, there are signs of a slowdown. Threats pop up from large screen phones or phablets, as they are commonly called.
Phablet is a smartphone having a screen size varying between 5.0 and 6.9 inches, unlike tablets (7 inch screens).
A recent report by analyst firm Cyber Media Research has shown an 18 per cent dip of tablet shipments between October- December of 2012 and the first three months of 2013. Shipments came down from 10,97,902 pieces (in October-December) to 9,05,000 between January and March.
To make matters worse, data consumption through tablets is low, despite rate cut by telecom companies.
“The dip in shipments is marginal because the number of launches made in 2012 was higher than the first part of 2013. Device-makers focused on large-screen handsets or a phablet,” Faisal Kawoosa, Lead Analyst, CMR, told Business Line . Market sources said the earlier part of this year saw launches by Samsung (Galaxy) and Micromax (Canvas HD) in the larger screen segment, and Apple focusing on iPhone 5 sales.
Local vendor Intex admits that demand has slowed. After a more than 100 per cent growth in 2012, sales have remained stable so far this year. Intex tablets are priced between Rs 5,000 and Rs 10,000.
“There is no major growth in the tablet segment. Focus is rather on smartphones and voice call-enabled large screen devices (phablets),” Sanjay Kumar, GM (Mobile), Intex Technologies, said.
But these are still early days for such a comparison, tablet-makers maintain.
According to Gautam Advani, Global Head, Mobility Business Unit, HCL Info, the tablet segment will continue to post “robust growth” with phablets and developments in manufacturing. Internal projections by HCL Info have pointed out that growth in the tablet market “is here to stay”.
Demand for devices
Acer India’s Chief Marketing Officer S. Rajendran maintains that the “early rush for adoption” (tablets) saw a spurt in vendors. Low-cost devices compromised on user-experience (by having inferior touch-screens). This apart, buying pattern in India is skewed towards a compact device; voice call-enabled tablets. “For the last six months people have realised that there’s limited functionality in low-cost tablets. Some maturity is coming in the market. Demand seems to be more in favour of device that can double up as a tablet and a mobile phone,” he said. In the long run, device-makers will have to keep such consumer demands in mind, he adds.
Sandip Biswas, Director at analyst firm Deloitte Touche Tohmatsu, is not amused. Most tablet purchases, he maintains, are a “status symbol”. As a result, data consumption remains low.
“For a majority of people, these are fun devices used mainly for gaming and social media. Demand will first go up and then head for disillusionment,” he adds.
Data Consumption
His point is well cushioned with Nokia Siemens Networks MBit Index report on mobile broadband trends. The report points out to smartphone being the preferred device for accessing Internet.
Tablets account for just 3 per cent of data consumption, compared with smartphones (49 per cent).
In metro and Tier-I cities data consumption through tablets is slightly higher at 5 per cent.
According to Katyayan Gupta, Analyst at Forrester Research, global trends suggest Wi-Fi based tablets as a popular device compared with their SIM-based counterparts. In India, the lack of popularity of Wi-Fi across Tier-II and Tier-III towns has seen increased demand for SIM-based offerings. Wi-Fi remains restricted to public places such as airport or select offices.
“Content creation through tablets is low. Usage is more for one-time data consumption,” Gupta adds.
Improper 3G availability and high data costs on 3G have been the other limiting factors.
“While Wi-Fi enabled tablets have been the main stay (in India), there is a strong traction for SIM-based categories (backing up as a smartphone and tablet),” HCL Info’s Advani adds.