Friday, April 5, 2013

Tablet Adoption in Emerging Markets Could Affect Fixed Broadband Prospects


It would clearly be rational to argue that the smart phone is going to be the most ubiquitous device used to access the Internet, in most emerging markets. But tablet importance is going to grow, especially if smart phone communications are grafted onto a greater number of tablet models.





In some ways, it might not matter whether people rely on smart phones or tablets as their primary Internet access device, especially if it is a mobile network that provides the access. But the balance of tablets and smart phones in use for primary Internet access might have huge consequences for ISPs.





The reason is that if the tablet emerges as the key Internet access device, the odds of fixed networks being used would rise commensurately, if the assumption is that tablets will use Wi-Fi access, not a mobile 3G or 4G connection.


Right now, smart phones have the higher installed base. But tablet use is growing faster, from a much smaller base. 

Smart connected device volume in emerging markets grew by 41.3 percent in 2012 with the tablet volume growing by 111.3 percent and smart phone volume by 69.7 percent year over- year.

By the end of year 2017, IDC predicts that the tablet and smart phone markets will have huge growth in the emerging markets.

In emerging markets, tablet unit shipments are expected to increase by 300 percent, while smart phone unit shipments are expected to double.

"In emerging markets, consumer spending typically starts with mobile phones and, in many cases, moves to tablets before PCs," says Megha Saini, IDC research analyst.

That could have important implications for providers of fixed broadband service in many markets, even if mobile networks remain the main way most people get access to the Internet.

Smart Connected Device Year-over-Year Growth by Region and Product Category, 2012-2017
Region
Product Category
2012
2013*
2017*
Mature Market
Desktop PC
-4.8%
-5.5%
-2.9%
Mature Market
Portable PC
-8.1%
-3.1%
-1.4%
Mature Market
Tablet
62.8%
41.4%
8.3%
Mature Market
Smartphone
20.6%
15.1%
4.6%
Total Market


15.6%
13.8%
4.2%










Emerging Markets
Desktop PC
-3.8%
-3.5%
0%
Emerging Markets
Portable PC
-0.8%
4.1%
7.1%
Emerging Markets
Tablet
111.3%
60.7%
13.4%
Emerging Markets
Smartphone
69.7%
35.1%
12.2%
Total Market


41.3%
26.6%
10.9%










Worldwide
Desktop PC
-4.1%
-4.3%
-1.0%
Worldwide
Portable PC
-3.4%
0.9%
3.7%
Worldwide
Tablet
78.4%
48.7%
10.6%
Worldwide
Smartphone
46.1%
27.2%
9.8%
Total Market


29.1%
21.2%
8.5%
Source: IDC


Smart Connected Device Market by Product Category, Shipments, Market Share, 2012-1016 (units in millions)
Product Category
2012 Unit Shipments
2012 Market Share
2017 Unit Shipments*
2017 Market Share*
2012—2017 Growth*
Desktop PC
148.4
12.4%
141.0
6.0%
-5.0%
Portable PC
202.0
16.8%
240.9
11.0%
19.3%
Tablet
128.3
10.7%
352.3
16%
174.5%
Smartphone
722.4
60.1%
1,516
67%
109.9%
Total
1,201.1
100.0%
2,250.3
100.0%
87.3%
Source: IDC


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