I noticed an article at analyst site Seeking Alpha last week that caught my eye. It was titled Apple’s Accelerating Tablet Dominance Is Underappreciated and it went over several points that Apple’s tablet lineup now has in its favor. Writer Zvi Bar makes some pretty convincing arguments, but does it matter?
First off, after a few years of steep declines, Apple has definitely righted the good ship iPad. Revenues aren’t growing significantly, but considering how poorly they (and most other competing tablets) were selling not too long ago, steady $5 billion quarters are a win for Apple. A big reason why the situation has improved is that they have done a good job of creating a cohesive tablet lineup to fit any need and any budget. The Pros have features and design that set them apart as being truly premium, while the new Air sits squarely in the middle, and the iPad and iPad Mini bring a lot of value for the money at the lower end.
As Mr Bar points out, Apple stuck to their guns and outlasted most of the major competition in the space. At this point, there is Amazon near the bottom of the name brand market with their consumption-oriented devices. With Google now gone, Samsung is really the lone competitor in premium tablets, but they aren’t gaining ground and really don’t seem to be trying to at this point. Even if you think of Microsoft’s Surface as a touch-first tablet (which it really isn’t), they still don’t have the anywhere close to the sales and market share of the iPad. The fact is, Apple owns the name appeal and the profits in the tablet space.
So Apple’s iPad owns the tablet space. What does that mean in tech today? Unfortunately, when you are talking about the kinds of scale that Apple, Google, Facebook, Amazon and Microsoft deal in, $5 billion is a drop in the bucket. Apple can use all it can get to help defray falling iPhone sales numbers and revenues, but tablets are just a small piece of that puzzle right now. For reference, we are talking about $5 billion out of 53.8 billion total revenue for Apple last quarter. Mac hardware, which the iPad had passed up at one point, generated $5.82. Wearables were at $5.5, passing both the Mac and iPad. Then the surging Services came in at $11.46, blowing them all away. Now you get a more complete picture of where the iPad currently falls.
Don’t get me wrong. I still love the iPad and I think it still has a bright future ahead. In fact, with the right improvements and added features, I still think it could have a second wind that sees it grow further and become a more important piece of Apple’s puzzle. However, while the iPad is likely underappreciated and does deserve respect for being the strongest tablet lineup in the market, facts are facts. Even as a writer for a site that used to be exclusively focused on the iPad, I have to admit that the iPad is currently treading water toward the bottom end of Apple’s current product lineup.
I’m not concerned about this right now. The iPad is very stable and, if anything, is growing slowly now that there is a full lineup that has better inexpensive options. Apple has also continued to invest in the iPad, bringing several great new hardware and software features and even a device-specific fork of iOS that will now have its own roadmap and progression. I’m thrilled about what Apple is currently doing with the device. That said, without continued growth, Apple will eventually put its focus and development resources elsewhere. Hopefully more steady growth will continue in the short term as Apple searches for new features that will carry the iPad to another period of growth.
So is the iPad underappreciated? I still think it is. However, I can’t deny that there is a legitimate reason that many aren’t paying attention to it right now.