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TMCNet:  Upstart tablet computers have left Apple bruised as shoppers choose cheaper models as presents: Supermarket groups raided iPad market with models priced at less than pounds 200

[December 25, 2013]

Upstart tablet computers have left Apple bruised as shoppers choose cheaper models as presents: Supermarket groups raided iPad market with models priced at less than pounds 200

(Guardian (UK) Via Acquire Media NewsEdge) It may come to be remembered as the year that tablet computers found the mainstream, but 2013 has seen a new wave of affordable, touchscreen devices that have sold in their droves this Christmas. With some tablets on sale for as little as pounds 30 and retailers including Tesco and Argos selling own branded devices, 2013 may also be remembered as the year that Apple no longer dominated the country's tablet sales.

"2013 was definitely the year of the tablet," said Francisco Jeronimo, research director for the analysts IDC. In the first three quarters of the year, 7.6m tablets were shipped to the UK, a year-on-year growth of 192% for the same period in 2012, according to IDC's data. Of those 7.6m tablets shipped, the average sale price was $407 making around $3bn (pounds 2.2bn) in sales.

Some 38% of those sale were Apple's iPad, which set the standard for tablet computers when it launched in 2010. This year saw two new models from the California-based company, including the iPad Air for pounds 400, and a revamped iPad Mini, with faster processor, for pounds 320.

But for the first time since it launched, the iPad wasn't top dog in UK sales. Tablets powered by Google's Android software won 56% of the market in the first three quarters of 2013, fuelled by popular, cheaper tablets with lower specifications. Google's Nexus 7 - costing less than pounds 200 this year - started the trend towards more cheaper tablets.

"The very low end tablet market saw very strong sales this year, which is something we're expecting to continue into next year and beyond - especially for Christmas," said Jeronimo. In September, Tesco made a surprise announcement by launching its Hudl tablet for pounds 119, acknowledging the exploding tablet market and the popularity of Android devices. Tesco's 7 inch Android tablet undercut the competition including the iPad, Nexus 7 and even Amazon's Kindle Fire tablet range. It was an instant hit and went on to sell 300,000 in its first two months.

Noting that its customers bought 1m tablets in 2012 alone, Argos followed suit in October with the poorly received Bush MyTablet for pounds 100, and this month Aldi started selling its Lifetab for pounds 80 which sold out in its first 24 hours.

Last week, the Indian government launched an even more aggressive assault on the tablet market with the Datawind UbiSlate, at pounds 30 in the UK.

"Parents looking to give gifts to children and teenagers are unlikely to spend pounds 400-500 on a tablet, so tablets sub-pounds 100 are less of an investment and more of an attractive disposable gift," said Jeronimo.

Of course, sales do not tell the whole story. With around 2.9m iPads shipped in the first three quarters of 2013 Apple claimed the premium end of the market, with each unit sold commanding a much higher average sale price than that of the higher volume low-end market.

Software is arguably one of the most important contributors to Apple's bottom end too. "Users who buy an iPad also spend much more money on apps and media within the Apple App Store and iTunes," explained Jeronimo.

For Google and its Play Store, however, the expansion of budget tablets is not such an important driver of revenue, because as Jeronimo explains, "users buying low-cost tablets generally only browse the internet or play free games." Christmas is when electronics retailers make the majority of their profit for the year. Last year saw half the total tablet sales made in the last quarter, and this Christmas will have followed suit.

Next Christmas, another wave of cheaper and even faster tablet computers is likely to be in the shops, said Jeronimo, and the devices will become even more commonplace. "In the short term the downward trend on price will definitely continue, and increasing tablet penetration will be fuelled by adoption in education and business as well as by consumers." Tablets have begun to replace traditional PCs, domestically and for some businesses. Tablet offerings will become more compelling as advances in technology make them faster, lighter and with better battery life. Current portable technology is held back by batteries that are heavy but store little power.

Several technologies promise to extend battery life for days rather than hours. Lithium-air batteries, for example, "use oxygen in the air as a reagent, rather than carry the necessary chemicals inside the battery," explained Professor Peter Bruce of the University of St Andrews. Another technique combining sulphur with lithium stores even more power, but currently can't be made safe enough to put in your pocket.

Other research points to how we might interact differently with our tablets. Researchers at the University of Bristol showed that the feeling of real objects could be simulated in mid-air using nothing but sound. These "ultrahaptics" use ultrasound to manipulate air molecules in a layer above the screen, providing the sensation of touching a real object through the skin.

This tactile feedback means that users could feel like they are turning a volume knob, grabbing a steering wheel in a racing game or perhaps bashing the keys of an imaginary typewriter.

Eventually, the fixed glass touchscreens of today may cease to exist.

Captions: The iPad has been dominant in the tablet market but a range of cheaper models has hit the market - taking a bite out of Apple's share Photograph: Matthew Lloyd/Getty Images (c) 2013 Guardian Newspapers Limited.

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