Apple’s share of tablet market slips

Apple’s share of the global tablet market has fallen from two-thirds to a half in the past six months, market researchers say, raising the stakes for its new iPad mini against a slew of new challengers using Google’s Android and Microsoft's Windows software.

The iPad mini almost sold out after it went on sale this weekend, Apple said on Monday, but the iPad's dominance of the tablet market is under assault from lower-priced competitors, led by Samsung and Amazon, while Microsoft's new Surface is taking aim at the business market. 

Google's Android has rapidly become the dominant smartphone platform, overtaking the iPhone. After a slow start, tablets using the search group's free operating system have now put a “sizable dent” in Apple's tablet market share, IDC, an analyst group, said on Monday. 

Apple’s share of worldwide tablet shipments fell from 59.7 per cent a year ago to 50.4 per cent in the three months to the end of September, IDC said, while Samsung’s leapt from 6.5 per cent to 18.4 per cent. 

Amazon has captured 9 per cent of the market with its Kindle Fire products, after less than a year on sale. Asus, which manufactures Google's Nexus 7 tablet, increased its share from 3.8 per cent to 8.6 per cent globally. Apple held 65.5 per cent of the market in the second quarter, IDC said. 

After receiving broadly positive reviews, Apple sold 3m iPads - including the mini and its new fourth-generation 10-inch tablet – in their first weekend, the electronics group said on Monday. Last month Apple said it sold 14m iPads in its most recent quarter, below analysts' expectations. 

The California-based company did not give standalone figures for the iPad mini, which was greeted by shorter queues than usually accompany Apple product launches at stores around the world on Friday, but chief executive Tim Cook said the 8-inch tablet had “practically sold out”. 

Apple’s shares closed 1.4 per cent higher at $584.62 in New York after it issued the sales figures, having fallen 3.3 per cent on Friday. Analysts had expected sales of at least 1m for the iPad mini this weekend but investors have been concerned about supply shortages holding back shipments of the iPad mini and iPhone 5. 

Android’s progress in tablets still lags behind its dominance in smartphones. IDC says it held a 75 per cent share of the global market in the third quarter, up from 57.5 per cent a year ago, growing largely at the expense of Research In Motion’s BlackBerry and Nokia’s Symbian. Apple’s iOS has expanded to a 14.9 per cent share of smartphone shipments over the past year. 

Anticipation of the release of the new iPads had caused many potential tablet buyers to earlier hold off from purchasing, according to IDC.

“Now that the new mini, and a fourth-generation, full-sized iPad, are both shipping, we expect Apple to have a very good quarter,” said Tom Mainelli, IDC’s research director for tablets. “However, we believe the mini’s relatively high $329 starting price leaves plenty of room for Android vendors to build upon the success they achieved in the third quarter.”

Apple posted 26.1 per cent growth in shipments over the past year, according to IDC, a rate far outpaced by its smaller rivals. Samsung grew 325 per cent and Asus 243 per cent.

Samsung has sold 3m of its Galaxy Note II, its 5.5-inch smartphone-cum-tablet, in just over a month since its launch, as well as more than 30m of its flagship Galaxy SIII smartphones over the past five months.

Apple has warned that its profitability in the run-up to Christmas will be put under pressure by the simultaneous launch of the iPad mini and a range of other Macs and tablets launched at an event in San Jose last month. Over the weekend, analysts at IHS iSuppli calculated that the bill of materials for the iPad mini is about $188.