IDC released its tablet market share report for the June quarter, and the company said that Apple's share of that market declined from 60.3 percent in the year-ago quarter to 32.4 percent in 2013. While Apple remained the single largest vendor by far, shipments from Samsung, Asus, Lenovo, and Acer all saw sharp increases in their global tablet shipments, while Apple reported 14.1 percent fewer iPad sales year-over-year.
First, let's look at IDC's numbers. The report used Apple's stated sales of 14.6 million iPads in the quarter and compares that to estimated shipments from Apple's competitors. This methodology is required because Apple alone announces unit sales.
Chart by The Mac Observer from IDC Data
There is a far cry from units sold and units shipped, and Daniel Eran Dilger has done some excellent work deconstructing reports from Strategy Analytics and IDC alike for AppleInsider.
What many people forget, however, is that while sales to the channel aren't the same as sales to end users, each quarter's estimates from firms like IDC are also not counting sales to end users during that quarter from units shipped into the channel in prior quarters.
For perspective, the retail channel is not going to keep endlessly buying and accepting shipments of devices that aren't selling to end users, and there are also limits to how many units a manufacturer like Asus can ship to the channel and then take back when they don't sell.
In other words, units shipped is not as accurate as units sold, but these numbers don't exist in a vacuum. The biggest thing to question about these reports is the sale of "white box tablets," as they're called by Strategy analytics and "Other" tablets, as they are called by IDC (check out Mr. Dilger's report on the white box tablets for some interesting questions on the subject).
The chart below shows the explosive growth of "Other" tablet year over year.
Chart by The Mac Observer from IDC Data
White box tablets are essentially cheap tablets made of cheap components by no-name brands (almost entirely in China) and frequently sold for well under US$100. They usually run old versions of Android, and they're not being used for much of anything, at least when compared to iPad users.
IDC's "Others" category of tablet sales aren't all white box tablets. Since IDC only reports the top five in all of the reports released to the public, this quarter's report means that Microsoft, Dell, and Amazon are all relegated to "Others" status.
Still, the "Others" category grew enormously, from 7.4 million units and 26 percent of the market in Q2 2012 to 17.5 million units and 39 percent of the market in Q3 2013. We know that growth isn't coming from Microsoft or the other Windows 8 tablet makers, and Amazon's non-December quarter tablet sales have never been good.
Which begs the question of what other tablets comprise this "Others" category, and why is it they don't show up in usage reports of any sort. The second question has a simple answer: most of these cheap "Others" are being sold in China and aren't being used to consume content from Western sources. As such, they don't show up in Western-based usage reports.
Even that begs the question of how those sales should be looked at. Just as with smartphones, where companies like Samsung sell a lot of cheap devices that are used like feature phones, rather than smartphones, how should this data be looked at?
The reality is that there are no simple answers. Anyone can make whatever they want out of any given set of numbers. Apple makes most of the profits in smartphones—though Samsung has narrowed that gap—and Apple appears to be making almost all of the profits in tablets.
That's one way of looking at it. App availability and downloads is another way to look at the market (it's not even a contest in the tablet market—Apple owns this space), as are paid app downloads, ads generated, click-through rates, shopping done, browsing, Internet traffic, and...
...everything but total numbers of tablets sold/shipped. I, for one, thought that Apple would maintain an iPod-like dominance of the tablet market for a while longer. That was the case for the first two and half years of the post-iPad tablet market, but that finally changed in the last 6-9 months.
I still don't understand why usage lags sales, but there is no doubt that Apple's share of the tablet market is decreasing. The biggest mitigating factor of the June quarter was the tough compare, as Apple CEO Tim Cook put it. Apple released the iPad 3 during the year-ago quarter, but reset that schedule by releasing the iPad 4 in the fall of 2012.
Still, there is no doubt that the competition saw significant gains this year while the iPad did not. Can app development and usage catch up? It seems inevitable, even if we haven't seen any evidence of that so far. At some point usage must come into balance with sales, either by fewer sales of non-iPad tablets or increasing usage of those non-iPad tablets.