The iPad’s Dominance of the Tablet Market

So this new report from the consulting firm Strategy Analytics, “Global Tablet OS Market Share: Q2 2011”, came out yesterday and made some news today:1

Peter King, Director at Strategy Analytics, said, “Global tablet shipments reached 15.1 million units in Q2 2011, surging 331 percent from 3.5 million in Q2 2010. Consumer and business demand for touchscreen computers remains high. Apple shipped a record 9.3 million iPads and registered a healthy 61 percent global tablet market share during the second quarter of 2011. However, Apple has drifted down from 94 percent share in Q2 2010 due to a rising number of competing software platforms.” Neil Mawston, Director at Strategy Analytics, added, “Android captured 30 percent share of global tablet shipments in Q2 2011.”

Clearly, Strategy Analytics are talking about unit shipments, not sales. (But in Apple’s case, unit shipments are the same thing as sales, because they’re selling iPads to customers as fast as they can make them.)

But then come the data tables, which are for “Shipments” (9.3 million for iPad, 4.6 million for Android) and “Marketshare” [sic] (61.3 percent for iPad, 30.1 percent for Android). What they’re calling market share is really “shipment share”. I don’t think that’s what most people think of as market share. By their metric, a company could take the market share lead by shipping 10 million tablets and selling none of them to customers.

I think what most people think of as market share is the share of sales. I think we can sort of figure out a rough approximation of the number of Android tablets and iPads that have actually be sold to customers.

The iPad has been on sale since 3 April 2010, encompassing five reported quarters. Apple has released iPad sales for each of those quarters (in millions): 3.27, 4.19, 7.33, 4.69, and for the just-completed quarter ending in June, 9.25.

That’s 28.73 million iPads sold.

As for Android tablets, Robert Synnott suggested on Twitter a way to approximate actual tablets sold. First, five days ago Google CEO Larry Page announced that Android was in use on 135 million total devices. Second, Google’s Android developer site publishes a regularly-updated breakdown of the Android OS version numbers in active use. For the 14-day period ending July 5, 0.9 percent of Android devices were using Android 3.0 or 3.1 — a.k.a. Honeycomb, the versions of Android specifically for — and only for — tablets.

Round that up to an even 1 percent to be generous, multiply by 135 million devices, and you get 1.35 million tablets.

So it looks like Apple has sold, to customers, over 21 times more iPads than all Honeycomb Android tablets combined. [Update: You get roughly the same result for total Android tablets sold if you go by Google’s published stats for Android device screen size, which suggests that almost no pre-Honeycomb Android tablets have been sold.]

I don’t know how to estimate how many Android 2.x tablets have been sold, but given that everyone seems to agree that Android 2.x did not make for a good tablet OS, it’s hard to believe that’s a bigger number than that for Honeycomb tablets. Do Nooks count? Sure, why not. But Barnes & Noble (like Amazon, with the Kindle) does not release sales numbers. Back in February Goldman Sachs analyst Matthew Fassler forecast 2.4 million Nooks sold for all of 2011. (And I don’t think Nooks are what most people are thinking about when they think about Android tablet market share.)

John Paczkowski, writing at some website today about a separate report (this one from Good Technology regarding the iPad’s large and growing adoption in the enterprise market), made this comment toward the end:

But the iPad can’t maintain that vast a lead forever. Android will likely narrow the gap in tablet activations just as it did for smartphones before, though Good doesn’t see that happening until at least 2012.

Not “might not” or “probably won’t” but “can’t”. You don’t have to look hard to find many other observers with the same belief — that Android will succeed in the tablet market similarly to how it has succeeded in the phone market. Why the certainty, though? It’s certainly possible, I agree. A 20-1 unit sale lead over all Android tablets combined seems preposterous. But I don’t think it’s certain. It reminds me of the certainty that many observers had, circa 2002-2005, that the iPod could not maintain a 70 percent share of the music player market.

The fundamental difference I see between smartphones and tablets is that mobile phones were an existing and long-standing market prior to the iPhone. Apple’s stated goal in 2007 was to get 1 percent of the total mobile phone market by the end of 2008. Most people today still buy phones the same way they did in 2006: they go to their local mobile carrier store and buy whatever the sales staff there convinces them to buy. Over 100 million times, that’s been an Android phone. I see no sign, though, that phone carriers are having any more success selling tablets than they ever were selling anything other than phones. Remember carrier-subsidized netbooks?2

I’m not trying to cherry-pick data. I’m simply observing, based on Apple’s sales data and Google’s activation data, that the tablet market doesn’t today look anything like the smartphone market ever did. The iPad didn’t enter the tablet market. It created the tablet market. The iPad’s role in the tablet market much more closely resembles the iPod’s role in the digital music player market a decade ago than it does the iPhone’s role in the 2008 phone market.

Or as Marco Arment wrote almost seven months ago, there still really is no “tablet” market — just an iPad market.