January 2011: The Tablet Economy: Growing Fast

In just a few months, the tablet category has evolved from having no traction to a veritable cottage industry, with millions of units sold and an aggressive growth outlook.

According to a new forecast by meta-analysis firm eMarketer, worldwide tablet sales are expected to reach 81.3 million units in 2012, up by 418% over the 2010 estimate of 15.7 million units.

This dramatic growth will be spearheaded by Apple’s iPad, which eMarketer estimates will sell 56.1 million units in 2012, up from 13.3 million in 2010. Although its share of the worldwide market will decline to 65% in 2012, from 85% in 2010, the iPad will continue to lead the category, the firm reports.

“Apple did not invent the tablet, but it created the modern tablet market by introducing a product that was infinitely more successful than its predecessors,” said eMarketer Senior Analyst Paul Verna.”

Apple is even more dominant in the US than in the rest of the world. eMarketer estimates that the iPad carries 88% of the domestic market in 2010. This share will fall to 74% in 2012—still a healthy majority that will put Apple in a position to call the shots when it comes to content distribution, pricing, marketing and other key functions.

The silver lining for Apple’s competitors is that the rapid and massive adoption of the iPad has created a viable market for tablets—one where there will be room for competitors in the future.

“The tablet market is not shaping up to be a winner-take-all scenario,” said Mr. Verna. “It is similar to the smartphone market, in which competition among makers of devices and operating systems has resulted in intense innovation. Tablets will follow similar dynamics, with many of the same companies playing starring roles.”

Highlights

  • Worldwide tablet sales will grow by more than 400% over a two-year period, reaching 81.3 million units in 2012.
  • The iPad is the dominant player in this market, with an 85% global share in 2010. This percentage will drop to 69% in 2012 as other players gain market share.
  • The US is the market leader in tablet sales, with 62% of the global share in 2010. By 2012, the US share will be 50%.

To find out more about eMarketer’s digital marketing coverage and the new report “Tablets: New Screens for Marketers,” visit eMarketer.