This week IDC released tablet market estimates and the figures are quite a bit off from my original Q1 estimate, but eerily similar to my revised estimate based on NPD's figures. Android tablets are poised to permanently steal the tablet market crown from the iPad, while Windows tablets continue to struggle. Let's take a deeper look at the figures.
Android now leads the tablet market, with a share of 56.5 percent, while the iPad's share falls below 40 percent. Windows tablets are still struggling, with a share below 4 percent and with struggling shipment figures, sell-through is always questionable.
So much for Apple's tablet reign that analysts stoutly stood by even just months ago. Android kicks ass, crushing iOS shipments during first quarter, according to IDC. Among the top four, the fruit-logo company posted the lowest year-over-year growth (65.3 percent), and considerably less than the overall market (142.4 percent). Meanwhile, the company's market share fell by 18.5 points to 39.6 percent.
Among tablet manufacturers, Apple is market leader, with the question being for how much longer. Samsung share rose 282.6 percent -- ASUS even more (350 percent). Strong Nexus 7 shipments pushed ASUS past Amazon to take third place. ASUS' challenge and opportunity could be Google I/O, where the tablet launched last year and new model is rumored for the event starting May 15. Challenge is maintaining shipments during product transition; opportunity is capitalizing on new sales.
Today's closing bell brings answer to a question oft-asked over the past two weeks: "Will Apple profits fall for the first time in about a decade?" Not since 2003, when the fruit-logo company recovered from economic woes that sapped global PC shipments everywhere, has profit receded. Now we know.
For fiscal Q2, Apple reported $43.6 billion revenue and net profits of $9.5 billion, or $10.06 a share. Gross margin: 37.5 percent. A year earlier, the company reported revenue of $39.2 billion and $11.6 billion net quarterly profit, or $12.30 per share.
What's wrong with Samsung? That's the question I asked in newsroom group chat today after seeing specs for Galaxy Note 8.0. Screen resolution diminishes the otherwise noteworthy feature list. Sorry, but 1280 by 800 is inadequate -- little more than matchup to Apple's iPad mini, which is similar size. For a company that makes such great-looking displays, lower-res is an endemic problem across Samsung's entire tablet line.
I really expected more from Galaxy Note 8.0, which as the same suggests has an 8-inch screen; iPad mini is 7.9. Samsung unveiled the tablet in February, and I wrote the news story. But in the rush of Mobile World Congress news didn't consider screen resolution, in part on possibility specs would change. The electronics giant has done it before, announcing one thing but shipping something slightly different months later.
Phil Schiller's preemptive attack against Samsung's Galaxy S IV, which launches later today, says everything you need to hear about the sorry state of Apple. I'm stunned, because the marketing chief sounds too much like Microsoft CEO Steve Ballmer in 2007, when he dismissed iPhone. Denial is the surest sign a company has lost its way, and I don't just mean some executive denying such-and-such product or competitor is any good as distracting marketing ploy. The worst, and Schiller gives it, is corporate denial -- the proverbial ostrich with head in the sand -- about the world around.
Last night, I saw Schiller quoted in the Wall Street Journal. This morning I see posts from Bloomberg and Reuters, too, and a raff of tech blogs and news stories -- largely quoting one of the more mainstream services. The Journal calls Schiller's Android attack a "rare interview". But I see something else: Desperation. Denial. What's missing means much more: The typical leaks and rumors about Apple's next thing that steals the thunder from a competitor. Apple has nothing to show, and the InterWebs are less embracing of rumors. How pathetic is that?
Nearly two months ago, when forecasting that tablets would outsell laptops this year, NPD DisplaySearch dropped dirty data bomb: shipments of slates with 7-7.9-inch screens will eclipse larger ones. Now the analyst firm puts real numbers behind the prediction, and they are grim for Apple. Talk about mixed blessings. iPad mini sizzles, while iPad fizzles. The problem: Higher sales of one takes away from the other, rather than expands demand. As such, margins are lower for the important category, likely biting Macs, too.
Panel shipments reveal the trend, and it is dramatic in just one month. "Shipments of 9.7-inch tablet PC panels collapsed, falling from 7.4 to 1.3 million, while 7-inch and 7.9-inch panel shipments grew rapidly, from 12 to 14 million", David Hsieh, NPD vice president, says. "Shipments of 10.1-inch panels grew only slightly" from December to January. Apple and Sony are the major manufacturers selling 9.7-inch tablets, the overwhelming majority iPad. Starting today, Sony sells the Xperia Tablet Z, in a move to 10.1 inches, but 9.7-inch volumes aren't high enough to account for such a dramatic shift in panel orders.
Amazon has launched Amazon Cloud Player 2.0 for iOS. The app, which lets users stream or download music from their Amazon Cloud collection, has been revamped to support the iPad and iPad mini for the first time, in addition to previous support for iPhone and iPod touch.
Version 2.0 also debuts a revamped user interface and adds a new setting that allows users to configure the size of the offline cache used for storing streamed music for access while offline.
Yesterday Apple rolled out iOS 6.1.2 for compatible iPads, iPhones and iPod touch devices, touting the fix of an Exchange calendar bug that might boost network activity and decrease battery life. And, as customary with a new iteration of iOS 6, there's also a new version of the popular evasi0n jailbreak tool. Evad3rs, the team responsible for the first iOS 6 jailbreak tool, released evasi0n 1.4 shortly after iOS 6.1.2 rolled out.
The latest version, according to the "evasi0n 6.0-6.1 Unthether" package in Cydia, touts the same bug fixes as two weeks ago when I reported on the first evasi0n update. It appears that the fruit company did not put the lid on modding attempts just yet. First-time jailbreakers running iOS 6.1.2 simply have to connect their iPads, iPhones or iPod touch devices to a compatible PC running Windows, MacOS X or Linux and run evasi0n to unleash the modding gates on their smartphone or tablet.
Panic in Cupertino: Headless chickens run around smacking into one another, because they don't know they're dead.
That's the fundamental problem with Apple, and this situation is largely independent of recent stock price declines that analysts, bloggers, reporters and other writers can't opine enough about. Falling shares are part of a necessary correction, as reality displaces perception. To understand what's happening now, you need to look into the past -- three years, which by Internet counting is like a lifetime.
Apple today released iOS 6.1, which is available via over-the-air download. The update extends 4G LTE support to 36 additional carriers, bringing the total to 70. High-speed data is also available to 23 more carriers for iPad. Apple already supports LTE in Australia, Canada, Japan, South Korea, United Kingdom and United States, among others. New coverage extends to Denmark, Finland, Italy, Philippines, Switzerland and some Middle Eastern countries, to name a few.
"If you look at the total of all of these and the incremental subscribers that are in those countries, that’s over 300 million", Apple CEO Tim Cook boasts. Availability and adoption aren't the same thing. IHS iSuppli sees global LTE subscribers reaching 198.1 million this year, up from 92.3 million -- that's 115 percent -- in 2012. The analyst firm forecasts 139 percent compound annual growth rate through 2016, with 1 billion expected subscribers.
Suddenly, I feel sorry for the folks over at Apple. Chicken Little bloggers and Wall Street analysts run round crying "The sky is falling!" Strangely, they are believed. Apple shares are down 38 percent from September's all-time high. On Friday, the company's market cap fell below Exxon's. Suddenly, the world's most valuable company isn't. I just don't feel right kicking fruit as it falls down, so as a gesture of goodwill my boycott ends today.
That's not to say I have plans to buy any Apple products. I'm more than satisfied with Chromebook and my three Nexus devices. That said, as an act of solidarity, I let Apple auto-charge my credit card for iTunes Match renewal today. I don't own a single device that supports the service, but, hey, what's $24.95 between friends? I was a loyal OS X and iOS user until my boycott started in June 2012, protesting aggressive patent lawsuits -- unaffectionately called innovation by litigation.
Today, after the closing bell, Apple answered the question analysts have asked for weeks: How many iPhones and iPads shipped during the holiday quarter? The answer: A colossal number -- 47.8 million and 22.9, respectively.
Apple also shipped 4.1 million Macs. Analyst consensus was around 50 million, 23.5 million and 5 million, respectively, for the three devices. But the big reveal is iPad and whether the mini sapped sales of the larger tablet. In the previous quarter, iPad's average selling price was $535. Three months later, with iPad mini widely available, ASP is $467. Apple launched the slate on November 2nd alongside iPad 4. The company touted 3 million early sales, without breaking out which device. Now we know something.
I'm not an investor or financial analyst. But I do have a measure of commonsense. Lots of people are asking about Apple's falling stock price and why it is. You don't need a MBA or ponder price-earnings ratios to, by commonsense, see what's happening. Apple is undergoing a long-overdue course correction. It's the new normal, baby, get used to it.
Analysts making wild-eyed predictions just months ago about $1,000 a share or bloggers banging keyboards about $1 billion market capitalization are nutty fruitcakes. Apple cofounder Steve Jobs is gone, so they made their own Kool-Aid and spiked it. They're the only thing getting high here. Apple is laid low.
There is no shortage of new tablets being announced at this week's Consumer Electronics Show -- Acer Iconia B1-A71, Polaroid M7 and M10 and VIZIO 11.6" Tablet PC, among many others. Meanwhile, NPD DisplaySearch forecasts that global tablet shipments will surpass notebooks this year. But what's interesting is a dramatic shift in size preference, which is why I want to know: Which is right for you?
DisplaySearch predicts that tablets with 7-to-8 inch screens will overwhelmingly dominate the market, with 45 percent share. Meanwhile, 9.7 inches -- the size Apple popularized with iPad -- will fall to just 17 percent share. Yet many of the slates debuting at CES are in the larger categories, typically between 10.1 and 11.6 inches. Does size really matter that much, and is smaller better?
Tim Cook smiled as he pulled up the blankets and shook his toes against the cool sheets. Christmas Eve had come and the last Apple Store closed. Preliminary sales were gangbusters. Wall Street analysts betrayed him with lowered share price targets and projections iPad and iPhone sales slowed. But he knew! Cook laughed and kicked his legs under the covers. The best fourth quarter for sure! Occasional giggles broke the silence until at last -- long last -- sleep became him.
But briefly, for rattling chains startled Apple's CEO from slumber. Chunk. Chunk. Chunk. The clanking grew louder and an ominous dragging sound with it. A frightening wail followed. Pain. Great pain! Then through the wall pushed out an apparition. Ghastly yellow eyes squinted behind a face sullen, sunken and seemingly familiar. Tattered black turtle neck and blue jeans -- the uniform worn by his predecessor and mentor. Realization pierced Cook, and he felt a burning hot fire in his solar plexus. Steve Jobs!