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Tablets Set To Outpace PCs In Q4

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Tablets Set To Outpace PCs In Q4
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The tipping point has arrived.

According to Bloomberg, researcher IDC released a report stating that tablet shipments will surpass those of personal computers in the fourth quarter for the first time.

Opting for ease and portability, consumers now favor mobile devices over laptops and especially desktop computers. The IDC report indicated that tablet shipments would hit 84.1 million units in Q4. PCs will fall short of that number at 83.1 million units.

The total market for Internet-connected devices, including tablets, smartphones, laptops, and desktops will grow 28 percent to $622.4 billion, according to IDC, and will be $735.1 billion at the end of 2015.

This anticipated growth is phenomenal when a projected 10 percent decline in PC sales is taken into account by the end of this year. This means that growth in mobile devices is not only making up the difference, but also pushing it forward significantly.

The big winners in the PC to tablet conversion process have been Apple (NASDAQ: AAPL), Google (NASDAQ: GOOG) and Samsung (OTC: SSNLF). Hewlett-Packard (NYSE: HPQ), Microsoft (NASDAQ: MSFT) and Intel (NASDAQ: INTC) have lost sales, according to Bloomberg.

Related: Microsoft Won't Stop Waging Battle In Tablet Wars

As market share grows, prices will continue to fall, the report said. Predictions indicated that devices costing less than $350 would eventually account for 68 percent of all connected-device shipments. By 2017, the average selling price for devices designed to connect to the Internet will be $323, IDC said according to Bloomberg.

Wireless Week reported that Megha Saini, Research Analyst with IDC's Worldwide Quarterly Smart Connected Device Tracker said in a statement, "Introducing new handsets and tablet devices at cheaper price points along with special initiatives like trade-in programs from Apple and Best Buy will accelerate the upgrade cycle and expand the total addressable market overnight."

The net result is that IDC anticipates smartphone sales to exceed 1.4 billion units in 2015, accounting for 69 percent of all smart connected devices worldwide.

IDC believes total PC shipments will drop to 13 percent of the smart connected device market by 2017, down from 28.7 percent in 2012, according to Wireless Week.

At that time tablets will comprise 16.5 percent of the market and smartphones will make up 70.5 percent.

IDC’s new predictions come despite an earlier estimate by the firm that growth in tablet sales would be slowed down by consumers adopting both “phablets” and wearable devices like Google Glass according to Information Age.

At the time of this writing, Jim Probasco had no position in any mentioned securities.

Latest Ratings for AAPL

DateFirmActionFromTo
Apr 2015Canaccord GenuityMaintainsBuy
Apr 2015SusquehannaMaintainsPositive
Apr 2015JefferiesMaintainsHold

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