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iPad Leads the Tablet PC Charge as Mini-Note Shipments Plummet

SANTA CLARA, Calif. — In the second quarter of 2010, shipments of mini-note/tablet PCs were down 4% Q/Q, but up 29% Y/Y. However, without the 3.3 million iPads shipped in the quarter, shipments of mini-note/tablet PCs would have been down 14% Q/Q and 13% Y/Y.

Clearly, there was an “iPad Effect” in the portable PC market, according to a new DisplaySearch report, the Quarterly Advanced Notebook PC Shipment and Forecast Report, which also tracks tablet PCs 5.0″ and larger. The effect might have been even more pronounced, but Apple struggled to fill demand, with shipment times listed as 7-10 business days for all of Q2’10, and shipments into Japan and China were just beginning at the end of the period.

Overall, the portable PC market posted strong Y/Y unit growth in Q2’10, surging 32% to 50.4M units. However, not all market segments were equal, and it is apparent that the combination of iPads and falling ASPs took share from other parts of the mini-note/tablet PCs segment and from the ultraportable segments of the market. Buyers chose iPad as a thin, lightweight device but buyers seeking more functionality chose larger notebooks, with only slightly higher ASPs.

The price gap between the average 11.6″ ultraportable notebook and the average 15.6″ portable notebook PC fell to less than US$60 in Q2’10. Revenue in the mini-note/tablet PC category was also positively impacted by the higher ASP of the iPad. Despite the Q/Q drop in unit volume for the category, revenues surged past US$4 billion as ASPs increased 21% Q/Q and 14% Y/Y.

DisplaySearch expects mini-notes to continue to sell well in emerging economies to first-time PC buyers. However, looking forward, we expect tablets like the iPad will continue to take market share from mini-notes and the ultraportable segment in regions where PCs have high penetration rates. The industry consensus is that a successful business model for tablets will center around an a la carte method for selecting the software capabilities (apps) for the device and content consumption (though the ability to create some content will certainly be possible), as opposed to the typical PC market trend that is built upon a Windows operating system and office suite applications for content creation.

“The end of 2007 witnessed the launch of mini-notes. The first quarter of 2010 signaled the birth of the tablet PC, and possibly by extension, the beginning of the end of the mini-note market, especially in developed regions,” said John F. Jacobs, Director of Notebook Market Research. “Apple has leveraged their successful iPhone business model onto the iPad. More than 50 other brands have tablets in varying stages from development to mass production. Unlike the mini-note/netbook model, which was not much more than a low-cost, basic mobile PC based on the Wintel platform, the majority of tablets have, or will, choose a combination of next generation Intel Atom CPUs or ARM-based CPUs paired with a version of Android, or in the case of HP, webOS.”

Jacobs added, “Although Apple now holds the vast majority of tablet PC market share, the plethora of other brands that have, or will soon be launching, their own tablets are sure to capitalize on what at this point appears to be widespread consumer demand for very thin and very light devices with exceptional battery life and a primary focus on portability and content consumption.”

Definitions

Mini-notes: Clamshell style devices with display sizes ranging from 7.0″ to 10.2″; also commonly referred to as netbooks.

Tablet PCs: Tablet style devices like the Apple iPad with display sizes from 5.0″ to 10.2″; also commonly referred to as slates.

New DisplaySearch Quarterly Advanced Notebook PC Report Now Available. Building upon DisplaySearch’s proven expertise in notebook PC market research, the company’s new advanced version of its Quarterly Notebook PC Shipment and Forecast Report will take your company’s notebook PC know-how to the next level. With expanded coverage of the end market, including street prices (ASPs) and system revenue for notebook and mini-note (netbook) PCs by display size/resolution by region, you won’t want to miss out on the latest information that can impact your business decisions.

Other report highlights include forecasted notebook and mini-note (netbook) PC shipments by region, display size, and resolution, along with insightful analysis of the state of the notebook PC industry, including the breadth and depth of mini-note and notebook PC demand in the major geographic regions, and identifying the key variables influencing changing demand patterns in these markets. For information on this DisplaySearch report, contact Charles Camaroto at 1.888.436.7673 begin_of_the_skype_highlighting              1.888.436.7673      end_of_the_skype_highlighting begin_of_the_skype_highlighting              1.888.436.7673      end_of_the_skype_highlightingor 1.516.625.2452,e-mail: contact@displaysearch.com or contact your regional DisplaySearch office in China, Japan, Korea or Taiwan.

About DisplaySearch

Since 1996, DisplaySearch has been recognized as a leading global market research and consulting firm specializing in the display supply chain, as well as the emerging photovoltaic/solar cell industries. DisplaySearch provides trend information, forecasts and analyses developed by a global team of experienced analysts with extensive industry knowledge and resources. In collaboration with the NPD Group, its parent company, DisplaySearch uniquely offers a true end-to-end view of the display supply chain from materials and components to shipments of electronic devices with displays to sales of major consumer and commercial channels. For more information on DisplaySearch analysts, reports and industry events, visit us at www.displaysearch.com. Read our blog at www.displaysearchblog.com and follow us on Twitter at @DisplaySearch.

About The NPD Group, Inc.

The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,800 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit www.npd.com and www.npdgroupblog.com. Follow us on Twitter at @npdtech and @npdgroup

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4 comments on “iPad Leads the Tablet PC Charge as Mini-Note Shipments Plummet

  1. bolaji ojo
    October 4, 2010

    The iPad and other tablet PCs obviously will cannibalize the mini-note or netbook market. There's no need in most people's lives for the iPad and a netbook plus a phone. Consumers will have to choose between the tablet PC and the netbook and with Apple in the fray it's obvious where the line is trending. Does this mean the end of the netbook, however? It seems to me there will be a role for the two. Many people will select the iPad over the netbook and many corporations will find a use for iPads and other computer slates in various aspects of their operation. The netbook will also find its niche.

  2. FreakEngine
    October 5, 2010

    Right now people want to have the same gadget that hollwood stars. I never seen a netbook in a famous movie or tv show. I think people try to adopt the same tech products that they see in the tv.

    The trend now is the iPad and people adopte. Also, one of the raison that people choice Apple is because they have a dynamic customer service and people trust more and more… if an iPad or iPod don't work anymore they can change for a new one if they can not repair the same day.

    And unfortunaly for a netbook, we need to ship to the company and way more time…

  3. papri1
    October 12, 2010

    Whatever it is, whether a notebook or a i-pad I will comment that the battery consumption of the electronic devices are a prime concern and requires to think of innovating ideas to increase the mode of time in its operation for amusement and also for work cultures.Multi user device is required for all types of uses and also in its user-friendly maintainenance.

  4. itguyphil
    October 15, 2010

    papri1,

    I agree with you 100%. I cannot tell you how infuriating it is when you spend hundreds of dollars on these devices & within a few months, you have to spend another $60 on an extended life battery (for cell phones at least).

    For example, I just spent over $2000 on a new laptop. I went crazy & got the extended life add-on up front (an additional $120). I get about 3-4 hours of battery life (more when the screen is dimmed). But it seems to me that in 2010 when we can run cars on batteries, how is it that a cell phone or laptop cannot run for a few days whithout recharging?

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