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Tablet Computer Market Set to Soar

The nascent tablet computing market is set to explode in 2011, as dozens of new devices will challenge Apple's iPad supremacy with new technologies and cheaper price points.

In fact, according to a report released today from the technology research firm Yankee Group, tablet sales will grow from 21 million in 2010 to 168 million in 2014.

"The growth in this market is unprecedented," said Dmitriy Molchanov, Yankee Group analyst and author of the report.

In 2011, Molchanov told iPadNewsDaily, the market for tablets will hit 60 million units.  “The tablet sales curve is rising faster than that of HDTVs, handheld gaming consoles or even MP3 players,” he said.

And, he said, the average tablet price tag in the U.S. will drop to $237 by 2015.

The numbers appear staggering considering the tablet only made its initial splash with the general public in January 2010. Molchanov predicts total global revenue from tablet devices such as the iPad and Samsung's Galaxy Tab will increase from $16 billion in 2010 to a stunning $46 billion in 2014.

To lend some perspective, Gartner Research has estimated the global sales for laptops rose 43 percent in 2010 compared to 2009, to 49.4 million units.

The tablet computer is closing ground fast.

Last year, the iPad claimed 95 percent of all sales in the third quarter and sold an estimated 7.5 million units, far more than its closest challenger.  However, this first mover advantage is slipping away and should recede a bit in 2011 as a host of new devices become available, according to Molchanov.

At the Consumer Electronics Show (CES) in Las Vegas this week, no less than 40 new tablets are expected to be introduced.

And laptop and netbook suppliers are taking notice.

In November, Microsoft admitted what many analysts and industry insiders have been saying for more than a year: The hugely popular tablet market is eating away at netbook sales.

Gavriella Schuster, general manager for Microsoft's Windows product management, told the Seattle Post-Intelligencer that netbooks were "definitely getting cannibalized" by the increasingly popular iPad and other tablet devices.

According to a study released in November from research firm ChangeWave, PC makers were forced to reduce netbook shipments in 2010 in the United States, while touch screen tablet makers worked overtime to keep pace with demand.

The survey also questioned more than 3,000 consumers planning to purchase a computer device in the next 90 days. Only 14 percent planning to purchase a laptop said they would buy a netbook, a 10 point drop from the highest point of the netbook’s demand in June 2009.

Other key findings from the Yankee Group study include:

  • In 2010, North America leads the way. The region accounts for 37 percent of total global tablet revenue.
  • By 2014, Asia-Pacific is the front-runner. The region, primarily China, will own more than half the global market (58 percent), while North America’s share will drop to just 17 percent.
  • Annual U.S. tablet sales will more than triple between 2010 and 2015. Tablet sales will grow at a CAGR of 31 percent, from roughly 8 million units in 2010 to 30 million units by 2015.