Apple Faces Slowed Tablet Growth

Apple’s tablet shipments are expected to slow and so is the overall market. The company and other makers had a slow growth rate in the fourth quarter hurt by an increasingly saturated market in the U.S., according to research firm IDC. According to the recent report, global shipments climbed 28 percent from a year earlier to 76.9 million units. This was compared with a 87 percent year-over-year growth rate in the fourth quarter of 2012.

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Apple aims to show consumers and investors innovation is a significant investment to the company. The report also indicated Apple saw its worldwide tablet market share for the quarter grow to 33.8%, up from 29.7% in the third quarter but down from its 38.2% share in the fourth quarter of 2012. Samsung retained its second-place spot on the strength of a wide portfolio of products and increased carrier support in markets like the U.S., grabbing an 18.8% share worldwide. That's down slightly from 18.9% the previous quarter, but up significantly from its 13% share a year ago. Rounding out the top five were Amazon (7.6%), ASUS (5.1%), and Lenovo (4.4%).

“Markets such as the U.S. are reaching high levels of consumer saturation,” Tom Mainelli, IDC’s research director for tablets, said in the report. “While emerging markets continue to show strong growth, this has not been enough to sustain the dramatic worldwide growth rates of years past.”

Worldwide tablet shipments grew to 76.9 million units in the fourth calendar quarter of 2013 (4Q13) according to preliminary data from the International Data Corporation (IDC) Worldwide Quarterly Tablet Tracker. The total represents 62.4% growth over the previous quarter and 28.2% growth over the same period a year ago. While the market's growth rates remain impressive, they're down dramatically compared to the year-over-year rates of the same quarter one year ago (87.1%) and indicate a significant slowing of the overall market.

"It's becoming increasingly clear that markets such as the U.S. are reaching high levels of consumer saturation and while emerging markets continue to show strong growth this has not been enough to sustain the dramatic worldwide growth rates of years past," said Tom Mainelli, Research Director, Tablets, at IDC. "We expect commercial purchases of tablets to continue to accelerate in mature markets, but softness in the consumer segment—brought about by high penetration rates and increased competition for the consumer dollar—point to a more challenging environment for tablets in 2014 and beyond."

Canalys reported that Tablets will make up 50% of PC market in 2014 with Android-derived operating systems will account for 32% of PC market next year. Tablet domination is set to continue, with Canalys forecasting 285 million units to ship in 2014, growing to 396 million units in 2017. Apple and Samsung are expected keep ahead of their competitors in the medium term, but there could be challenges for both vendors competition in the tablet market.