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PC Manufacturers Phasing Out of Tablet Sector in 2012?

By - Source: DigiTimes | B 40 comments

Sources claim that PC vendors like Acer and Dell will phase out of the tablet business next year due to fierce competition from Apple, Amazon and Barnes & Noble.

Unnamed sources from the "upstream supply chain" believe that Acer, Asus, Dell, HP and other big-name PC vendors will likely begin to gradually phase out of the tablet sector in 2012.

According to the sources, these vendors don't have any kind of advantage over the likes of Apple, Amazon and Barnes & Noble due to their lack of strong content support and competitive hardware prices. As an example, Amazon is currently offering its Android-based Kindle Fire tablet for $199 whereas Barnes & Noble offers the Nook Simple Touch at $99.

Because of these competitive price points, "pure hardware players" are unlikely to profit from the tablet market in 2012. To make matters worse, it's believed that these devices will eventually be offered free given that Amazon and Barnes & Noble mainly profit from their content platforms.

Still, the sources also see troubled times for Apple. They point out that, while the iPad 2 still sees a strong demand, sales have been lower than those of the original iPad. This may indicate that enthusiasm for tablets on a whole may be quickly dwindling away.

Is this lack of enthusiasm based on tablet prices? As seen with HP's webOS-based TouchPad, consumers will scoop up a tablet left and right when the price is just right... or in this case, really cheap. Amazon estimates that it's $199 7-inch Kindle Fire will sell around 5 million units by the end of the year, or rather, in the first six weeks of its presence on the market. Apple's original iPad has sold 28 million units since its launch in early 2010.

"We believe the Fire's low $199 price point and broad distribution ... will help expand the market to consumers who previously may have been reluctant to purchase a higher-priced tablet," said JP Morgan analyst Doug Anmuth who believes Amazon will sell 20 million more units in 2012.

That said, is the overall price of each tablet the industry's bottleneck? Or is having a huge, feature-rich content service simply the key to launching a successful tablet? This may be what PC vendors have realized, and why they may phase out of the tablet sector next year. Still, perhaps Windows 8 will be their champion...

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  • 17 Hide
    Parsian , November 18, 2011 3:17 PM
    i personally think, Windows 8 will merge tablet/laptops at one point (Asus Transform Prime with attachable keyboard or new ultra books with touch screen and maybe even detachable screen?) and the only other tablets left would be that of Amazon/Android due to large amount of content. Android will eat the phone market all for by itself...
  • 12 Hide
    obiown77 , November 18, 2011 3:35 PM
    wasn't it not too long ago that big executives were shouting in the streets that the PC is dead and tablets would rule the world?

Other Comments
  • 8 Hide
    dark_lord69 , November 18, 2011 3:14 PM
    Seems like a smart move.
    This Tab Fad will end soon enough...
  • 17 Hide
    Parsian , November 18, 2011 3:17 PM
    i personally think, Windows 8 will merge tablet/laptops at one point (Asus Transform Prime with attachable keyboard or new ultra books with touch screen and maybe even detachable screen?) and the only other tablets left would be that of Amazon/Android due to large amount of content. Android will eat the phone market all for by itself...
  • 5 Hide
    cloakster , November 18, 2011 3:17 PM
    If Asus's Transformer Prime does very well then I don't see why they would need to pull out of the tablet sector.
  • 5 Hide
    thesnappyfingers , November 18, 2011 3:29 PM
    Quote:
    This Tab Fad will end soon enough...


    I don't see the tab fad "ending" persay anytime soon. The product is simply following a typical prodcut penentration curve.

    Yes there will be a reduction of choices, in terms of brands and suppliers. however, the product will continue to penetrate various market segments. There is plenty of demand and growth avalible for these tabs.
  • 5 Hide
    thesnappyfingers , November 18, 2011 3:30 PM
    I'm still not buyin one though...
  • 12 Hide
    obiown77 , November 18, 2011 3:35 PM
    wasn't it not too long ago that big executives were shouting in the streets that the PC is dead and tablets would rule the world?

  • 1 Hide
    chomlee , November 18, 2011 3:35 PM
    Parsiani personally think, Windows 8 will merge tablet/laptops at one point (Asus Transform Prime with attachable keyboard or new ultra books with touch screen and maybe even detachable screen?)



    I agree. I think tablets are not necessarily a fad but are more a way of how we do things in the future. I think the transformer is ahead of its time and I think an operating system like windows 8 might make a device complete with being able to carry it arround or attach it to the keyboard.

    HP was stupid for releasing a product and then getting out of game when the product wasn't out long enough to catch on. WebOS was a great product, unfortunately, it wasn't marketed properly and failed.

    It all depends on what the bottom line of the cost for the tablets are. If the cost of a tablet is $250, sell it for $275 and people will be all over that and even though you didn't make money on the first batch, you have at least established a name for yourself in the market. Of course if the cost of these tablets are $375 then I can see why they have no choice but to sell them for $399 and how it wouldn't pay to stay in the marketplace.
  • 0 Hide
    JeanLuc , November 18, 2011 3:42 PM
    dark_lord69Seems like a smart move.This Tab Fad will end soon enough...


    I'd take a tablet over a netbook any day of the week. Tablets have there uses, causal gaming, causal internet browsing, you can hook them up to your TV, good for video calling, there's many uses.

    obiown77wasn't it not too long ago that big executives were shouting in the streets that the PC is dead and tablets would rule the world?


    Do you have source for that comment? I've never read or heard anyone say anything of the sort.
  • 2 Hide
    de5_Roy , November 18, 2011 3:47 PM
    i liked hp's touchpad firesale for one reason: it showed people and the tablet makers that a really cheap tablet would definitely sell. imo it kinda set a price point where tablet prices should be set at. this is where amazon, b&n can win against competitors using their content library as leverage. tablet makers who fail to market stuff at that price would eventualy fail.
    after that people will eventually turn back to convertible laptop-tablet hybrids/laptops with touch-enabled detachable displays.
  • 0 Hide
    GreaseMonkey_62 , November 18, 2011 3:49 PM
    Quote:
    I'd take a tablet over a netbook any day of the week. Tablets have there uses, causal gaming, causal internet browsing, you can hook them up to your TV, good for video calling, there's many uses.



    Do you have source for that comment? I've never read or heard anyone say anything of the sort.

    I don't know about shouting from the streets, but Steve Jobs was certainly touting that launguage and I noticed a few sites picked up on that line.
  • 2 Hide
    CaedenV , November 18, 2011 3:57 PM
    Where is Wolfgang now? *mechanical Laughter*
    There is nothing wrong with tablets, and my bet is that they will be a mainstay of the future (much like GPS and MP3 players; not everyone has/needs one, but they are fun accessories and useful to some). They will not replace desktops. They will not replace netbooks/laptops/ultrabooks. They will remain as a nitche market for people who want a simple cheap device as an extension of their more powerful/useful devices.

    I think the thing hurting them most is the lack of professionally accepted applications such as Office. Once they make Win8 and Office for ARM there may be a resurgence of demand for tablets, but as of now it is a glorified phone, but without the phone, and you cannot work on it, so it is a little bit useless. Just a few software changes and the whole game might change.
  • 0 Hide
    Anonymous , November 18, 2011 3:59 PM
    Considering this is the exact opposite of every news story since windows 8 was unveiled I have a very tough time believing this story.
  • 0 Hide
    robisinho , November 18, 2011 4:01 PM
    looks like intel missed by only one or two years.
  • 5 Hide
    AerieC , November 18, 2011 4:04 PM
    JeanLucDo you have source for that comment? I've never read or heard anyone say anything of the sort.


    Let me google that for you:
    http://lmgtfy.com/?q=pc+is+dead

    It's all we've been hearing for the past year.
  • 1 Hide
    Netherscourge , November 18, 2011 4:06 PM
    I like Tablets more than Laptops.

    My only gripe is that developers don't seem to invest much money in the apps for them as they do for the Desktops/Laptops/Consoles. Most apps are just silly games or navigational/personal assistant type of stuff.

    I'm sure being limited to a touchscreen is a pain. But still, more support is needed.
  • 2 Hide
    Onus , November 18, 2011 4:06 PM
    The ultimate tablet needs to be much like the "desk" that appeared in the novel Ender's Game, on which you could do most any kind of work. Windows 8 may make this possible in a way Android doesn't seem to, at least not yet. I'd be looking for something a lot more compatible with mainstream software, networks, and overall systems. Then there's de5_roy's comment about pricing, which is dead-on. I'd love to buy a tablet, but I can't begin to justify $300-$500 for one with the features I'd want (never mind 3D gaming, that's why I have a desktop PC).
  • 0 Hide
    loomis86 , November 18, 2011 4:10 PM
    The problem with a slate or tablet type computer is the price. People have smartened up a little and realize they are only worth a couple hundred bucks. Its pretty hard to make a profit on one if people are only willing to pay 200bucks.
  • 0 Hide
    clonazepam , November 18, 2011 4:25 PM
    There's a finite number of people willing to pay a high price for an electronic piece of equipment. Those that were not in the know before, surely know now, that their purchase will be outdated shortly. That knowledge further decreases sales of the most high-end devices.

    Anyway, there's still a lot of money to made in this sector, in the future. I suspect these companies are not quitting, and just hibernating, while plugging away at R&D to make a strong comeback when the timing is right.
  • 2 Hide
    wardler , November 18, 2011 4:45 PM
    Here is the problem: We buy a new computer every 3-5 years. Apple, among other companies, tries to sell us a new 500 dollar tablet and 500 dollar phone every year. People just can't afford the upgrade their entire family every year. I know I can't.
  • 2 Hide
    ProDigit10 , November 18, 2011 4:48 PM
    tablets was a niche, but they where and still are 'unpractical'!
    They are unpractical to hold, without a stand almost unusable on the desktop, with a stand less portable and nice for transport, unprotected when they fall, the majority of them are overwhelmingly underpowered; do not have a hardware input device, but focus on a touch screen keyboard taking up 50% of screen space; batteries are very short lived and offer battery for only a few hours, dragging a hardware keyboard and mouse with a tablet just isn't it; they are too large to be fitting in your pocket, yet too small to comfortably read and work on, their 3G networks are overcharged (internet is too expensive, and mainly unnecessary and slow for most people)...

    I think the public gets the picture, a tablet is just like MS VISTA, shiny and nice looking, and uncomfortable and not practical!

    They had one advantage, they caused CPU's to be manufactured that where even more powerful per watt than before!

    Back to netbooks guys!
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