Why Apple must keep innovating with tablets

Apple’s dominance of the tablet market is eroding, according to new figures from IDC, as the iPad claimed only 50.4 percent of total units shipped worldwide in the third quarter of 2012. Apple’s market share is down from 59.7 percent from the same period in 2011, while second-place Samsung’s share more than tripled to 18.4 percent. Amazon took third in the tablet race at 9 percent, just edging out Asus’s 8.6 percent.

It’s clear that Apple ceded ground at the low end of the tablet market, where Amazon’s Kindle Fire lineup and others are attracting users with price points in the $200 range. That’s a segment Apple hopes to reclaim with the new 7.9-inch iPad mini, which is getting positive reviews and appears to have sold well during its launch last weekend.

Apple probably could have retained part of that segment by bringing the iPad mini to market sooner, of course, but there’s still a lot of room for growth in tablets. The worldwide tablet market grew 49.5 percent over the last year, accounting for nearly 25 percent of all computers sold. Tablets will continue to eat into the PC market as they increasingly become a replacement for laptops rather than a complementary device. I think Apple would be wise to take a cue from Microsoft (no, really) and develop a tablet that makes it easier to perform laptop-type functions. If there’s one lesson Apple should learn from the last year of the tablet market, it’s that resting on your laurels will cost you.

Relevant analyst in tablets
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  1. So I suspect that Apple are not deliberately “resting on their laurels”, particularly with the competition so hot on their heels. Taking a cue from Apple’s newfound love for legal action, one has to assume that they haven’t got all that much left in their locker. At least not much that is truly differentiated. That’s usually the point where marginal return on lawyers fees becomes more valuable to you than using that cash on R&D.

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