IDC Says Tablet Shipments to Top Total PC Shipments in Q4 of 2013, Will Be Ahead of PC's Annually by 2015

The worldwide smart connected device market, comprised of PCs, tablets, andsmartphones, is forecast to grow 27.8% year over year in 2013, slightly lowerthan the 30.3% growth in 2012. The growth will be driven by tablet andsmartphone shipments, while the PC outlook has been lowered by 10% in 2013. Asa result, the International Data Corporation (IDC) Worldwide Quarterly SmartConnected Device Tracker expects tablet shipments to surpass total PCshipments (desktop plus portable PCs) in the fourth quarter of 2013 (4Q13).PCs shipments are still expected to be greater than tablet shipments for thefull year, but IDC forecasts tablet shipments will surpass total PC shipmentson an annual basis by the end of 2015. Smartphones will continue to ship inhigh volumes, surpassing 1.4 billion units in 2015 and accounting for 69% ofall smart connected device shipments worldwide.In terms of shipment value, the worldwide smart connected device market willagain exhibit double-digit year-over-year growth of 10.6% in 2013, but thisgrowth will gradually slow to just 3.1% in 2017. The tapering revenue forecastreflects the increasing impact of low-cost smartphones and the white boxtablet market. Worldwide smart connected device value is expected to be $622.4billion in 2013, of which $423.1 billion will come from the sub-$350smartphone and sub-$350 tablet segments collectively. "At a time when thesmartphone and tablet markets are showing early signs of saturation, theemergence of lower-priced devices will be a game-changer," said Megha Saini,Research Analyst with IDC's Worldwide Quarterly Smart Connected DeviceTracker. "Introducing new handsets and tablet devices at cheaper price pointsalong with special initiatives like trade-in programs from Apple and BestBuywill accelerate the upgrade cycle and expand the total addressable marketovernight."IDC expects the lower-cost devices to drive interest worldwide and help tospark uptake among first-time buyers in commercial sectors like education. Anew round of device cannibalization is also expected to kick in, but this timewith large-screen (5+ inch) smartphones beginning to impact the smaller (7-8inch) tablet market. "The device world has seen several iterations ofcannibalization impacting different categories, with the last few yearsfocused on tablets cannibalizing PC sales," said Bob O'Donnell, Program VicePresident, Clients and Displays. "Over the next 12-18 months, however, webelieve the larger smartphones, commonly called 'phablets', will start to eatinto the smaller-size tablet market, contributing to a slower growth rate fortablets."Looking forward, the worldwide smart connected device space will continue tosurge, with overall shipments surpassing 2 billion units by the end of 2015with a market value of $735.1 billion. In terms of device mix, total PCshipments accounted for 28.7% of the smart connected device market in 2012while tablets accounted for 11.8% and smartphones for 59.5%. By 2017, totalPCs are expected to drop to 13%, while tablets and smartphones will contribute16.5% and 70.5% respectively to the overall market. The shift in demand fromthe more expensive PC category to more reasonably priced smartphones andtablets will drive the average selling price (ASP) for the collective marketfrom $462 in 2012 to $323 in 2017.Smart Connected Device Market by Product Category, Unit Shipments and MarketShare, 2013 and 2017 (shipments in millions)Product 2013 Unit 2013 2017 Unit 2017 2013—2017Category Shipments Market Shipments Market Growth Share ShareDesktop PC 134.4 8.6% 123.11 5% -8.4%Portable 180.9 11.6% 196.6 8% 8.7%PCTablet 227.3 14.6% 406.8 16.5% 78.9%Smartphone 1,013.2 65.1% 1,733.9 70.5% 71.1%Total 1,556 100% 2,460.5 100% 58.1%Source: IDC Worldwide Quarterly Smart Connected Device Tracker, September 11,2013.In addition to the table above, an interactive graphic illustrating IDC'ssmart connected devices forecast for 2012-2017 is available here. The chart isintended for public use in online news articles and social media. Instructionson how to embed this graphic can be found by viewing this press release onIDC.com.