Hasta La Gadget!

As mobile computing continues to consume the PC’s lunch, a core part of that cannibalisation story is of course  the growth in tablet ownership. Analyst Forrester has put out a new forecast for the global tablet market, which predicts tablet sales will continue their rocket-like growth trajectory in the coming years, with a projected compound annual growth rate of 25.6% between 2012 and 2017.

Forrester predicts tablets will exceed a worldwide installed base of 905 million in five years’ time, with annual projected sales of 381.23 million in 2017.

Back in 2010, the year Steve Jobs’ unboxed the first-gen iPad, the global installed base for slates was a mere 15 million+ showing the category has achieved what Forrester dubs “hyper-growth”. The analyst is forecasting more than 327 million tablets will be in use worldwide this year. (Apple’s category leading iPad achieved cumulative sales of more than 140 million as of Q2 2013.)

Tablets represent “the most successful branch” of today’s fragmented computer market, according to Forrester, both by penetration rates and diversity of competition within the category. In the future, it’s expecting tablets to power new types of “collaborative computing” behaviour — involving the use of multiple slates or “tablet-like devices” that support multi-user interaction.

Forrester is predicting that a healthy majority (60%) of online consumers in North America will own a tablet by 2017. In Europe this figure will be lower, at just under half (42%). While in the developing world it expects tablet penetration rates to remain under a quarter (25%) in aggregate by 2017, although it expects certain “wealthier Asian markets” — such as Singapore and South Korea — to feature tablets as established, “universal computing tools” by then.

Tablets at work

The report also delves into what people are using tablets for — vs traditional PCs and smartphones. Use of computing device type varies considerably by location and mobility status, with tablets being most commonly used at home, according to Forrester’s survey (76% of respondents reported using their slates here). The next most popular location for tablets was ‘at the work desk’, cited by 58% of respondents, underlining the important role tablets have carved out in the business space. A further 49% reported using tablets at ‘other room at work’.

“Business applicability shows the full potential of tablets,” notes Forrester in the report. “A comparison of where workers leverage PCs, tablets, and smartphones shows that while PCs rule the desk, tablets rival smartphones in terms of their mobility.”

Fragmentation

The report also notes that the tablet market is fragmenting across a variety of form factors, OSes, connectivity and accessories — something Forrester expects to continue, as it says “buyers don’t hold uniform preferences on tablet sizes”. In other words, it’s  horses for courses where slates are concerned.

So, while “many” potential tablet buyers (61% of surveyed consumers) gravitate towards “traditional” tablets (i.e. those with screens between 8.9 to 10.1 inches), Forrester notes that smaller slates (7 to 7.9 inches) have a preference share of around 16%. And very large tablets (10.1 inches+) were of interest to a still relatively sizeable 11%. And a full 12% of surveyed consumers didn’t know which size slate to buy yet.

Turning to tablet OSes, Forrester said it expects Apple to maintain its tablet lead, with iOS and the iPad, but also predicts continued growth for Android, principally from Samsung and Amazon tablet hardware. It also envisages Microsoft Windows-based tablets gaining traction in future — but notes that the apps situation needs “great improvements” before that can happen.

“Forrester believes that Windows will find a foothold in the tablet market but that it will require great improvements in the ecosystem, specifically the number and quality of Modern UI apps, for this to happen,” the report notes.

Collaboration

Looking ahead, the analyst expects tablets to continue to encourage new types of collaborative computing. Possible scenarios  include interaction on a TV-sized, single screen, multi-touch supporting tablet-like device — it cites Lenovo’s IdeaCenter Horizon and Microsoft’s PixelSense technology as examples of the kind of tech it’s thinking about here.

It also sees the rise in usage of multiple tablets linked together by collaborative apps, such as Labs’ MindMeld app.

“Using the MindMeld application, [tablet users in multiple, remote locations] join a collaborative workspace that updates in real time during the call. The MindMeld app “listens” to the conversation, surfacing themes and topics word-cloud style. It then leverages an anticipatory computing engine to find relevant content (say, from the Web) that it surfaces on those topics,” the report notes. “These pictures, videos, articles, and other content create a richer conversation as well as a record of the collaborative experience that should drive stronger, more effective, more data-supported collaboration.”

It also expected tablets to  play a key role in the rise of smart connected devices such as health tracking kit and home automation devices — as “management console devices”.

Analyst Forrester is predicting tablet ownership in Western Europe will quadruple by 2017 – with the percentage of online adults owning a slate projected to increase markedly from less than a fifth (14 per cent) last year to more than half (55 per cent) in 2017. In 2011 the tablet-owner figure stood at just 7 per cent, underlining how quickly digitally connected consumers are adopting slates. ”With double-digit growth in tablet uptake across Western Europe in 2012 and further double-digit growth expected, tablets can no longer be considered a fad,” says Forrester, writing in a new tablet-related research report it’s putting out tomorrow.

The analyst said it expects the consumer-owned installed base of tablets to reach more than 147 million in Western Europe in 2017, up from 33 million in 2012. Its tablet growth forecast is based on a survey of 13,000 consumers in France, Germany, Italy, Netherlands, Spain, Sweden, and the UK. The polled nations with the largest proportion of tablet owners, as a percentage of their total online population, were the Netherlands, with 20 per cent tablet penetration in 2012; Spain with 18 per cent; Italy with 16 per cent; and the U.K. with 15 per cent. France was lowest with just nine per cent.

In a preliminary version of Forrester’s tablet report, seen by TechCrunch, a few observations stand out — including a downward shift in the age-range of the largest group of tablet owners, shifting away from 30- to 40-year-olds to 18- to 24-year-olds. The analyst found a quarter of online adults in the 18- to 24-year-old category owned a tablet in 2012. The shift towards more younger tablet owners may accelerate in future — Forrester points to the rise of “competitively priced” Android powered tablets in the sub-€250 category, such as Amazon’s Kindle Fire and Google’s Nexus 7. And since tablet ownership increases with income, according to Forrester’s findings, and the young are keenest on owning a tablet, then cheaper Android tablets which are half the price of Apple’s iPad are likely to be helping to drive adoption lower down the age range, to users who previously may not have had the disposable income to afford an iPad. As well as Android-powered slates stepping into that pricing vs demand gap, Apple also came out with the smaller, cheaper iPad mini last year. Yet more fuel for the tablet fire.

The living room and the bedroom are the only locations where tablet owners chose their slate over their smartphone

While the young are the keenest on tablets, Forrester said they are by no means the only age-group with an interest. Nearly one in six European online consumers aged 65 or older already owns a tablet, according to the report.

Despite the rise of cheaper slates, price remains a considerable barrier to tablet entry for a big chunk of online European adults — Forrester found that around a third of those polled are not planning on buying a tablet due to price (and regardless of income) — suggesting lots of potential tablet owners still have trouble justifying the purchase of an additional gadget, on top of their smartphone or PC.

When it comes to tablet usage, Forrest found that tablets are unsurprisingly most used in the home — specifically the living room, bedroom and kitchen, whereas smartphones have a much wider and more consistent distribution of usage (as illustrated by the graphic below). The living room and the bedroom are the only two locations where polled tablet owners chose their slate over their smartphone. Or, in other words, the most used gadget is the gadget you have in your pocket.

According to Forrester, the main usage activities for tablets are accessing the Internet, emailing, social networking, playing games, and viewing pictures. It also found that tablets are not the highly personal devices that smartphones are: of the tablet-owners who have a spouse/partner, 63 per cent said they share their tablet with them, while one-third share it with their children — making tablets “a far more social device than smartphones”, according to the analyst.

“Tablets are social devices mostly used in the digital home,” said Thomas Husson, analyst and co-author of the new report, in a statement. “Companies that want to exploit tablet opportunities need to understand they require a differentiated approach from smartphones.”

The report also underlines a ‘halo effect’ for smartphone makers who also sell tablets. Forrester identified a general allegiance among smartphone owners to their phone’s brand when choosing a tablet — especially pronounced for iPhone owners but not limited to Apple’s hardware. The report notes:

While the Apple iPad is the dominant tablet in Western Europe, it is most popular with iPhone owners — a staggering 83% of European iPhone owners who have a tablet opted for an iPad. Similarly, the Samsung Galaxy tablet is most popular with Samsung Galaxy and Wave smartphone owners, and the Windows 7 tablet with owners of Windows-based smartphones.

Tablet owners also tend to own a plethora of other connected gadgets — six others on average, according to Forrester — and are “more technology savvy than non-tablet owners”, a finding that is consistent with an early adopter profile. Forrester links smartphone ownership to tablet ownership as a key driver for slate sales up to now — noting that “the proportion of European smartphone owners who own a tablet (28 per cent) is more than double that of those who aren’t smartphone owners (12 per cent)”.

However the analyst says what’s true for the current crop of (still early adopter) tablet owners, won’t be true as tablet ownership expands to take in a greater proportion of the population. ”We are still in the early-adoption phase of tablet ownership, so the next wave of tablet owners will not be as eager; to convince them to adopt a tablet, marketers will need to stress attributes like accessibility, ease of use, and relevance,” says Forrester.

The analyst believes tablets are likely to expand their usefulness beyond the living room/bedroom in the near future, with usage patterns being shaken up by a variety of factors including enterprise/workplace adoption of tablets; the diversification of form factors (such as smaller tablets and phablets, touchscreen laptops and “netvertibles”, hybrid devices and other new forms); as well as the roll out of 4G cellular services and more cellular data bundles.

Likewise, tablet usage will be dictated by form factor — so usage patterns may also shift, as tablets migrant to other locations. “A tablet with an attachable keyboard will encourage greater usage of email and work-related applications; and while not a pocket-size device, a 7-inch tablet will encourage greater portability,” the report notes.