Tablet Sales Strong, Netbooks Waning … Where's Microsoft?

IMS Research released an interim update to its tablet study following six months of iPad sales. The firm estimates that 21 million tablets will ship in 2010 and forecasts this market at 129 million units shipping in 2015.

Based on the recently published study Impact of Connected Tablets on the Consumer Electronics Market – 2010 Interim Update, tablet sales are expected to continue at an even stronger rate as Apple expands its retail reach and as others such as Samsung and RIM introduce new products. Anna Hunt, study author and principal analyst at IMS Research, comments, “Apple’s early market leadership will be difficult to catch. The market will likely become quite crowded as new tablet products continue to be deployed through 2011, but only a few have the marketing reach and brand presence that can compete with Apple.” IMS Research estimates that iPads will account for 73 percent share of the market in 2010, with Samsung, RIM, and Dell key competitors to watch for in 2011.

Tablets are quickly becoming competitive and are expected to have a significant impact on the netbook market. Although IMS Research is still estimating more than 34 million netbooks shipping in 2010, the company did reduce its netbook forecast for units in 2011 by 20 percent, and its forecast for 2015 by half. Gerry Xu, analyst and author of the newly published World Market for Notebook PCs & Netbooks – 2010 Edition, states, “Tablets are expected to take share from netbooks, especially in the United States, Western Europe, and Japan markets. However, netbooks are still attractive for users seeking fully-featured PCs with a low price and small form factor. This could offset the decreased share caused by the impact from tablet PCs and keep the market flat over the next few years.”

There's no question that Apple's iPad has sparked consumer interest in a form factor that had previously struggled. Remember what Steve Ballmer had to say about tablets and the iPad earlier this year? He essentially said Microsoft would ultimately dominate tablet computing. He downplayed the iPad, underhandedly complimenting the iPad as a general-purpose consumer device, naturally championing Windows tablets as more adaptable to particular uses.

"We're in an 'iPad bubble'," Ballmer said, promising that "sleeker, smaller, and faster" Windows tablets would soon overshadow the iPad. "[Apple] built what they could build when they could build it," Ballmer went on. "Is it a flat device? Well yes, but then you plug it into a dock when you need to do more typing on it. The ad from our competition in three years won't be Mac vs. PC, it will be whatever this new device is versus the PC."

"Whatever this new device is" might be, for example, Toshiba's recently released Libretto W100, a limited-edition, dual-touchscreen ultra-mobile PC (UMPC) that runs Windows 7. It's powered by a 1.2GHz Intel U5400 processor, has 2GB of DDR3 RAM, offers a 62GB solid state hard drive, and boasts two 7" touchscreens with 1024x600 resolution.

Or perhaps "whatever this new device is" might be the new BlackBerry PlayBook Tablet that Research in Motions (RIMs) recently announced. This new device features a 1GHz dual-core Cortex A9 CPU, 1GB or RAM, a 7" display, eReader functionality, full document editing, full pairing with BlackBerry devices, a front 3-megapixel camera and a rear 5-megapixel camera, full HD video, and 1080p HDMI output.

Seems like Microsoft has a lot of catching up to do!