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One became many: the tablet market stratifies


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Tablets have gained popularity with extraordinary speed, and manufacturers will have to work hard to stay on top of the evolution of the market. There appear to be more users and use cases for tablets than many had imagined. Getting the balance of form, function and price right will likely be a moving target during 2014, especially at the lower end of the market. Whereas the large tablet market has generally been highly lucrative for manufacturers, the surge in smaller low‑cost models may dilute levels of income and profitability. Manufacturers should research usage carefully, so as to understand users’ needs and expectations across the whole category, and design devices that comprise only the components that are necessary. A first time buyer is more likely to become a repeat purchaser if their first device performs well in terms of battery life and screen quality, even if that comes at the expense of integrated GPS or a massive hard drive.

Apps developers and website owners need to research in more detail how users of different types of tablet interact with content, and which legacy features frustrate. They should note that there is a substantial variance in screen size, which will impact interface design. As more web access moves to the touch screen, the size, shape and function of HTML links, buttons and other features will likely need to adapt.

Mobile carriers need to identify which models of tablet are most likely to be used over a cellular network. The compact premium tablet may be the most suited to a cellular subscription in 2014. Their size makes them more likely to be carried around and used on mobile networks; their owners are more likely to be able to afford an additional mobile data subscription. In some markets, tablets could be added to pooled usage tariffs, with various devices using one monthly data bundle. For Wi‑Fi only tablets, owners could be encouraged to pair these with their smartphone’s tethering capability. This is not as elegant as having integrated mobile broadband, but it works, even if it can drain the host smartphone’s battery. For everyone else, mobile operators with hot‑spots could offer access to their network.

Fixed operators with no mobile coverage could also target Wi‑Fi only tablet owners by offering them access to their Wi‑Fi hot spot networks, either as a separate subscription, or as a feature within existing fixed line services subscriptions. Tablets are often used when stationary, and Wi‑Fi capacity should be located wherever people tend to linger, such as shopping malls and train stations.

Marketers should consider how to vary strategy by tablet model. In some regards, advertising on smaller tablets is harder. When the average screen size for a tablet was over nine inches they generated around $7 advertising income, per device, per annum. As the average screen size falls, display ad revenue may be impacted, but not necessarily negatively, as the greater portability of compact tablets may increase hours spent with these devices.

Content providers should focus specific attention on where, when and why different form factors are used. Larger devices lend themselves to movies, video and television; smaller devices tend to be used more commonly for text such as the web, books and magazines. As the tablet becomes more mainstream and widespread, entirely new content formats may be warranted; but as a basic minimum, optimizing existing formats for different form factors will likely be required.

Enterprise CIOs should assume that falling prices and increasing capabilities of tablets mean that they are more likely to be used in a work capacity. The right approach depends on each company’s specific context. For some, the right answer may be to block access by any device not provisioned by the IT department. For other companies installing strong authentication solutions and partitioning tablets to have separate professional and personal areas is the solution.

Companies with field force departments should also constantly review the growing range of tablets launching on the market, to assess whether a combination of a consumer‑oriented device, combined with a robust case, costing a few tens of dollars, may be sufficiently resilient to be suitable for use for staff working outside of office environments (for more information, see the 2014 Prediction: Ruggedized devices at $250: reinventing the business case for mobile field force).

Limited storage means less room for apps and content, and lower processor speeds often means apps running slowly, or not at all. Low screen resolution often means pixelated video and poorly rendered images and text. While some consumers, especially younger ones, may have low expectations and will be satisfied with such performance, for many consumers, the low‑cost tablet will represent a false economy.

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