Poor Consumer Demand Pulls Down India Tablet Market in CY Q1 2017

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According to the latest IDC Quarterly Personal Computing Device Tracker, 701,000 tablets were shipped in India in CY Q1 2017 - a marginal drop of 2.2% from 716,000 units in the previous quarter. Tablet shipments in the consumer segment also declined 28% in Q1 2017 compared to the same period last year and resulted in a sharp 18.6% year-on-year (YoY) drop in total tablet shipments in India.

The commercial segment accounted for one-third of total tablet shipments in India. According to Celso Gomes, Associate Market Analyst, Client Devices, IDC India, “The commercial segment is the key driver for offsetting the declining consumer shipments in India. Due to growing digital proliferation across industries, commercial segment especially large enterprise, government and education sectors, are expected to increase their demand for tablets. This will drive vendors to focus more aggressively in gaining market share in the commercial market to sustain the India tablet market.”

Here are other trends in Q1 2017 that IDC observed in an otherwise stagnant India tablet market:

• Tablets with 4G based connectivity accounted for around 39.2% in Q1 2017, up from 15.3% from Q1 2016.
• For the first time in recent years, the share of 7-7.9” tablets dipped to 70% in Q1 2017. 8-8.9” tablets contributed to 12.3% of the total tablet shipments in Q1 2017, up from 8.9% in Q1 2016, primarily driven by consumer segment. Shipments of 10” plus tablets were up by 43% YoY in Q1 2017 to account for 11.6 percent of market share.
• Detachable tablets still account for a nominal share of the total tablet market, driven primarily by the consumer segment. Acer continued to dominate this product category, followed by Apple’s iPad Pro.
• Tablets sold through online channels accounted for 35% of the total tablet shipments in Q1 2017.

Tablet Company Highlights:

Samsung: Samsung leads the tablet market at 21.3% market share. Samsung shipments increased 4.0% quarter-on-quarter (QoQ) in CY Q1 2017, primarily due to healthy growth in commercial shipments. Samsung’s Galaxy J Max continues to be the top selling model for the company driven primarily by consumer segment, followed by Galaxy Tab A.

Datawind: Datawind secured the second position with 20.7% market share. Although shipments grew by 16.7 percent from the previous quarter, shipments are down 38.9% over Q1 2016. Datawind’s slowdown is primarily due to demonetization in Q4 2016 and partial transition in channel operations from third party television sales to setting up its own TV home shopping channel.

Lenovo: Lenovo placed third with 20.0% market share as shipments remained stable over previous quarter. Two-thirds of Lenovo’s shipments in Q1 2017 went to commercial segment.

iBall: iBall maintained its fourth place standing with 4.7% QoQ in Q1 2017. With increased participation in commercial deals, iBall is expected to gain momentum in commercial segment while most of the other key India vendors continue to be consumer oriented.

Apple: Apple maintained its fifth-place position despite shipments declining by 38.2% compared to previous quarter. iPad Air 2 remained the top selling model for Apple constituting more than half of its total shipments in Q1 2017. Limited shipments of iPad mini, which accounted for over one-third of total shipments last quarter, would result in shrinking of iOS market in India.

IDC India Forecast:

Tablet shipments in India in CY Q2 2017 are likely to be negatively impacted by the GST implementation which is expected to begin from 1st July 2017. The distribution channels for tablets will be cautious on procuring new inventory especially in the month of June. “Apprehensions on lower tax credit and lack of complete clarity regarding the processes are the major concerns of retailers and city/state level distributors, which may lead to a limited inventory stocking, especially in the June 2017,” says Navkendar Singh , Sr. Research Manager, IDC India. “But impact is expected to be short spanned as channel would prepare themselves for the festive season in second half of Q3 2017.”

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International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world's leading technology media, research, and Events Company.