SA to buck global tablet sales trend

While tablet sales were roaring during 2013, there are some market analysts, including IDC Corporation, which expect sales to drop significantly during 2014. South Africa could buck the trend, however.
At least one local notebook and tablet retailer, The Notebook Company, has said that local sales should improve “slightly”.

Christopher Riley, CEO of The Notebook Company, comments: “In a recent announcement, the IDC has stated that tablet sales will halve during 2014. Personally I just don’t see this happening – certainly not in South Africa, and certainly not at The Notebook Company.”
Riley says he expected his company’s tablet sales to increase by high single digits, “or possibly by double digits”.

‘We are fairly bullish about sales for this year. We are starting to leave the fumes of the global financial meltdown behind us – and I believe that, in itself, will play a part in more buoyant sales figures. Even if, globally, we see an increase in tablet sales during 2014, we are still seeing a growing market. It might be that it is just hard to emulate the sales during 2013, which were pretty good.”

According to the IDC, tablet sales reached 221-million units in 2013, up 54% on the previous year. But it said that this year’s sales will drop by as much as 22%, taking sales to 271-million units.

IDC also said that, by 2017, tablet sales would have slowed to single digit growth.
One of the reasons given for this decline is that consumers are opting for smartphones over smaller tablets.

Tom Mainelli, research director: tablets at IDC, says: “In the US, where tablets have been shipping in large volumes since 2010 – and are already well established -we’re less concerned about big phones cannibalising shipments and more worried about market saturation.”
It is further felt that, while consumer preferences have tended towards small tablets over the past 24 months, the rise of large phones could push consumers back towards larger tablets.

“The difference between a 6 inch smartphone and a 7-inch tablet isn’t great enough to warrant purchasing both,” Mainelli says.

But Riley insists that tablet sales will increase in South Africa during 2014 – and might even breach the double-digit mark. “We saw an increase in tablet and notebook sales in the last two quarters and we are expecting further sales growth during the next two quarters … we certainly see room for continued growth.”

Google’s Android tablets set to overtake Apple iPad says The Notebook Company

The tablet market is arguably one of the most fiercely competitive marketplaces in the world, with a number of the world’s biggest companies fighting for market share. But, while Apple iPad has been the clear leader since the tablet market started in full force in 2010, its lead is about to be eclipsed by Google’s Android devices.

This is according to Christopher Riley, CEO of Pretoria-based notebook and accessories retailer, The Notebook Company – and one of South Africa’s leading sellers of Apple iPads.

“We are seeing some pretty distinct market shifts and Apple’s heydays as the hands-down leader in the tablet market seem numbered,” said Riley.

IDC has already reported that shipments of tablets running Google’s Android operating system will surpass Apple this year for the first time. “There are a growing variety of smaller and cheaper Android-driven tablets from Google to Amazon.com, which are really becoming increasingly popular with consumers.  It’s not just the tablet market where Apple seems to be losing traction,” said Riley.  “Samsung, arguably Apple’s biggest rival, is coming to market with a slew of tech-savvy and funky  tablet and iPhone solutions, which are starting to take a bite of Apple’s market.”
Samsung’s fourth generation of its flagship Galaxy is about to hit the market and it is this range of smartphones that knocked Apple off its pedestal as the world’s number one supplier for part of last year.
“There is a lot of market anticipation for the new Samsung Galaxy,” said Riley, “and we could very likely see more inroads this year.”

While Apple might be facing more competition, Riley said he still believes that iPad sales will be the main contributor to The Notebook Company’s total revenue for the year. “For the past two years Apple iPad sales have been our main sales line.

" This is changing and, therefore, we are also offering a wide range of Android devices. We are also suggesting big name brands  when clients are looking at Android devices. We have offered low-end no-name tablets before, but we always warn clients that it is a case of ‘you get what you pay for’” 

In the meanwhile, the shine seems to be coming off Apple, with its share price being the first to show this – losing more than one-third of its value since hitting a high last September.

Microsoft’s Surface tablet will lift the level of competition in the local tablet market – but will it sell much?

Microsoft’s long-awaited – and much-touted – Surface tablet is due to hit South Africa’s shores within the next few months and, while it is expected to lift the already high level of competition in the tablet market, sales are unlikely to be huge, said Christopher Riley, the founder of Pretoria-based notebook and accessories retailer, The Notebook Company, one of the biggest sellers of the Apple iPad.

Riley said Apple is currently facing elevated competition from Android-driven tablet devices – which are generally cheaper than the iPad – as well as from an invigorated Samsung, whose tablet sales have risen meteorically in recent months.

“Apple’s share of the global marketplace has fallen from 51,7% to 43%, while Samsung’s has doubled from 7,3% to 15%. The arrival of Microsoft’s tablet in South Africa isn’t going to make a huge impact. Microsoft has lost too much traction over the last three years and the entrance of the long-awaited Surface is just that – it is long-awaited. It is late – and Microsoft has arguably lost its chance to become a core player in the tablet market.

“It is being touted as a great tablet from a price/performance perspective. Of course, time will tell. But I don’t believe they will be big sellers locally.”

Commenting further, Riley said that while Apple iPad sales still account for the lion’s share of the company’s revenue, sales have dropped in recent months as other tablets become more popular, including the Samsung devices.

The  Microsoft Surface will be available in both Windows 8 Pro and Windows 8 RT (run time) versions.

iPad sales going slower says The Notebook Company

The Notebook Company, the Pretoria-based notebook and accessories retailer – and one of the biggest suppliers of Apple iPads in South Africa – reports that sales of iPads are down 40% for the first two months of the year, compared to the same period last year.

This is according to Christopher Riley, MD of The Notebook Company, who said he had predicted the drop in iPad sales as consumers had over-spent over the festive season and their indebtedness is on the increase. He noted, however, that sales of laptops were only slightly down on the first two months of 2013.

“We were expecting a slow quarter this year. In addition, Apple has introduced a slew of products which has led to a certain amount of confusion in the market. They have also, in a manner of speaking, cannibalized their product range by bringing out too many products perhaps – products that compete for market share.”

He said he expects an improvement in sales during the second quarter, but said he was not expecting any “major upturn” during March.

“We had a very good run with iPad sales during the past three years. They are probably at their lowest point for us right now. We are currently focusing more attention on our traditional line of other branded laptops,” said Riley.

CHINA IS NOW THE BIGGEST SMARTPHONE AND TABLET USER – THE NOTEBOOK COMPANY

China is now the biggest market for smartphones and tablets, said Christopher Riley, MD of Pretoria-based notebook and accessories retailer, The Notebook Company – and one of the biggest suppliers of Apple iPads in South Africa.

“Right now China is reporting the highest number of active iOS and Android devices. Additionally, it is among one of the fastest growing markets in terms of the adoption of smart devices. Obviously, China is a huge market – but it has now also proven that it is a quick adopter of the latest technology,” said Riley.

Until the end of January 2013 the USA came in as the number one smartphone and tablet market with 222 active smart phone devices, followed by 221 million in China. But it is thought that, by mid-February, China nudged ahead of the USA.

“The percentage penetration is naturally higher in the USA due to the population comparisons, but China’s uptake is quite spectacular.”

China has a population of around 1.3 billion people, compared to the USA’s population of about 310 million people.

“Interestingly,” said Riley, “India, with a population of around 1.2 billion people, only has 19 million active smart device users. This points to an affordability issue and the state of the haves and the have-nots in that country, more than likely,” said Riley.

Too many Apples a day – or on the market – cause confusion says The Notebook Company

The current infusion of Apple products being introduced onto the market is causing confusion, which, at the end of the day does not auger well for the second most valuable company in the world. Because, when consumers are confused, they are cautions when it comes to buying.

This is according to Christopher Riley, managing director of laptop and accessories retailer, The Notebook Company – one of the biggest local sellers of the Apple iPad tablet range.

“Apple is in danger of confusing the market,” said Riley. “It might be the leading seller of tablets, but the current rash of product launches – and the confusion with iPad tablet names – is not good for business at the end of the day.

“When the Apple iPad 3 came onto the market it was called the New iPad. Then, when the Apple iPad 4 was introduced it was called the New iPad with retina display. But the problem,” said Riley, “is that the iPad 3 – called the New iPad – also has retina display.

“But it doesn’t stop there. Apple, which was dethroned as the most valuable company recently by Mobil Exxon, has also introduced the iPad mini. Some consumers – certainly some of my customers – think this is actually the iPad 4.

“When consumers are confused they tend to halt, or stall, purchase decisions because they don’t want to come across as stupid. Also, the sales cycle is a lot longer because retailers, like ourselves, have to explain things to customers in more detail – or customers have more questions. This extends the sales cycle.”

Apple starts to report slowing profits

Meanwhile,  at the end of last month Apple’s share price started nosing southwards, falling to $439,88 – giving it a market capitalisation of $413 billion (R3.6 trillion), compared to oil behemoth Exxon Mobile, who clocked in with a market value of $418 billion. Apple first superseded Exxon Mobil in August 2011 as the most valuable corporation based on the value of its stock. A year later it toppled arch rival Microsoft as the most valuable firm in the world in history with its stock valued at $622 billion.

But Apple has started to see its inner core bruising after a somewhat dull forecast accompanying its record quarterly profits, which pointed to a possibly less stellar growth.  Despite a record quarterly profit investors got cagey after hearing that gross margins further down the line would be 37,5% to 39,5% lower than expectations.

To get a clearer picture of the more gloomy prognosis  one has to cast one’s mind back to when Apple’s stock price hit more than $700 a share . This was reached in  September  last year, but, since that zenith, the price has dropped by 37% . The company also shed $60 billion in market capitalisation.

The Notebook Company’s Riley said some market analysts are postulating that Apple is losing its edge due to a dip in innovation since the death of co-founder Steve Jobs. There are also tangible  signs that it is losing traction to Samsung, which now leads the smartphone market, and to others using Google’s Android operating system.

Despite Apple’s stellar performance in the past it is questionable whether it will be able to maintain the margins it is accustomed to. With the possibility of smartphone price wars Apple’s traditional market positon of holding the high ground with premium products aimed at the high end of the market may bite deeper and deeper into profits from each device sold.

“But although Apple is receiving some negative press currently, it must be remembered that the tallest trees attract the most wind velocity. Apple has reached such heights these past few years that the wind velocity they are encountering is pretty fearsome.

“But Apple is by no means rotten to its core,” Riley quipped.

Tablet sales will be more than 30 million ahead of laptop sales in 2013 – The Notebook Company

It is expected that more than 240 million tablet PCs will be shipped during 2013, effortlessly surpassing the  207 million notebook PCs projected to ship during the year, said Christopher Riley, managing director of laptop and accessories retailer, The Notebook Company.

“We are also witnessing this trend at The Notebook Company,” said Riley, “and have been since the introduction of the first Apple iPad.”

He confirmed that the company is currently selling more tablets than laptops – a trend it expects to carry on “into the future”.

According to market research firm NPD Group DisplaySearch, tablet shipments are projected to grow 64% in 2013 compared to 2012.

“Projections are also being made,” said Riley, “that, by 2017, nearly three tablets will be sold to every one laptop.

“In fact,” Riley quipped, “the name of the company – The Notebook Company – is now essentially misleading, as we sell more tablets than notebooks.”

But Riley said while sales of laptops might be under pressure the company is hoping to increase its business as a “lot of clients will be looking to make a switch to laptops rather than upgrading or buying new desktops”.

He believes this could turn into a “fairly big” market for the company over the next 12 – 24 months.

Demand for laptops will be muted during the first quarter of 2013

Demand for laptops will be weak  during the first quarter of the year, and this is not only because of the market share being stolen by tablets, said Christopher Riley, managing director of laptop and accessories retailer, The Notebook Company – and one of the biggest local sellers of the Apple iPad tablet range.

Riley said it is “important to remember” that laptop demand – not counting netbooks – was already moving downwards before the tablet industry caught fire.

“Apple’s iPad, the soon-to-follow Android and Windows slates and, more recently, Windows RT tablets, are simply acting to aggravate these already existing problems.”

Riley said it appears that the general consensus among market watchers is that first quarter of 2013 will not witness an upsurge in laptop demand. In fact, he said, it could be an ever less lucrative quarter for notebook markets than usual.

“Generally, the first quarter of the year is a slow season due to the fact that many people are still recovering from the spending sprees of the festive season. Adding to the challenges, this year notebook vendors will have to content with Windows 7 notebook oversupply, pressing many to offer as many price cuts as is possible. Installing Windows 8 on units will help somewhat, but it must be remembered that many owners of Windows XP/Vista and 7 systems are probably not yet ready for performance upgrades. They might even opt to buy a new phone or a tablet instead of a PC.”

But Riley said that while there will be pressures on laptop sales, the popularity of tablets will continue. “Apple iPads will continue to outsell our range of laptops during the first quarter of this year,” said Riley, “and, frankly, I see this continuing into the year.”

Apple faces increasing competition in the tablet market

Apple has remained as the leading player in the tablet market since its debut with the iPad two years ago, but the company – now the most valuable company in the world – could very well lose its market share to Google-based Android devices.

This is the opinion of Christopher Riley, MD of The Notebook Company – one of the country’s leading notebook and accessories retailers – which also runs the on-line sites Laptop.co.za and Notebook.co.za.

Riley said Apple is losing market dominance “fast”, one must also keep in mind they had all of it initially.  The third quarter of 2010 saw the iPad securing 87% of the market. Now Apple commands just over 50% of the market. “The release of the Apple iPad Mini has also affected sales of the iPad. There has been a lot of hype surrounding the iPad  Mini and many people put their purchase decisions on hold, waiting, instead, for the arrival of the mini tablet from Apple.

“In a way Apple seems to have shot itself in the foot with the launch of the mini Apple tablet, certainly as far as a diversion of consumer spending is concerned. But even with the fall-off of iPad sales, Apple will still remain very dominant in the tablet market. But it will share market leadership with Android-driven devices, and we can all agree Tablets are here to stay”

The Notebook Company launches tabletZ.co.za Online Retail Site to grow tablet sales

   

Notebook and accessories retailer, The Notebook Company – which manages Laptop.co.za and Notebook.co.za online retail sites – is to launch tabletZ.co.za site as part of a plan to capture more of the tablet market.

Christopher Riley, CEO of The Notebook Company, said tablet sales now account for the lion’s share of the company’s revenue, with Apple’s popular iPads leading the revenue stakes by “a long way”.

“The Notebook Company took ownership of the Notebook.co.za online site in 1997 when thin laptops were referred to as notebooks, similar to now when thin Laptops are called ultrabooks.  We then took ownership of the Laptop.co.za site during 2008 and started managing it in parallel with Notebook.co.za.

“For the past year we have been looking for the right online name to take our tablet business further – with some cyber squatters wanting up to R250 000 for some appropriately named domains. We thought long and hard before coming up with the name tabletZ.co.za – and it is now our new online name for tablets. Who knows, maybe we might release some tabletZ branded tablets in the future. ” Riley quipped.