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A senior hardware analyst at JP Morgan has stuck his neck out and says the expected flood of tablets may not occur this year because tablet vendors have revised their production plans in the wake of stiff competition from the iPad king, Apple.
Mark Moskowitz says faced with unrelenting competition from the iPad, tablet vendors have reduced their tablet production with the number two tablet vendor, Acer, expected to build just 8 million units, while Samsung may just build 6.5 million units, each cutting down their production of tablet units by around 1 million tablets.
Others such as Dell, Motorola, Rim and Toshiba have also cut their production plans by around 10 percent, resulting in the number of tablets companies collectively plan to build to be around 73 million units, of which only 63 million are expected to ship.
Apple has also cut its iPad production down, with Moskowitz estimating the tech giant will build just 38 million iPads this year. HTC and Lenovo have however kept their build plans intact.
“We do not think the first generation of tablet offerings from the non-Apple tablet hopefuls stand to offer compelling price and feature sets to drive incremental purchasers within vendors’ projections,” Moskowitz said.
Moskowitz says the ‘reality check’ by tablet vendors, has come due to the lack of a tablet that matches the high demand engendered by the iPad.
As a result of the market correction, Moskowitz says the expected tablet bubble may not occur after all. However, the iPad and its rivals, with 63 million units in circulation, may still affect the overall PC market, according to the analyt.
“On a relative basis, our assumptions of total tablet shipments in 2011 amount to only 3 percent and 11 percent of total handset and smartphone units, respectively. In contrast, our tablet unit assumptions amount to 32 percent and 21 percent of desktop and notebook PC units, respectively, which we think means that tablets stand to be big enough to have positive (or negative) spillover effects on the broader tech food chain.”
