2-in-1 devices on the rise in Australia as tablet sales decline

The tablet market is continuing to see a shift towards 2-in-1 devices – computers that can operate as a tablet or as a laptop – according to research from analyst firm Telsyte.

The Telsyte Tablet Computer Market Study 2019-2023 report found that 1.44 million tablets were sold in the first half of 2019, a decline of 2 per cent compared to the same period last year.

During the six-month period, Apple, Samsung and Microsoft continued to be the top three vendors.

iOS-based devices were the most popular at 53.4 per cent tablet sales share, an increase of 5 per cent. Following this, Windows-based devices accounted for 27.4 per cent tablet sales share, an increase of 3 per cent, Android-based devices at 17.6 per cent, a decrease of 28 per cent, and other devices at 1.6 per cent.

Apple also was the leader for repeat purchase intentions in the first half of 2019, followed by Samsung and Microsoft at over 85 per cent, 75 per cent, and 60 per cent, respectively. 

Improvements in wireless connectivity technology was found to be a reason behind tablet upgrades according to Telsyte, including 5G, Wi-Fi 6 and eSIMs.

Indeed, eSIM compatibility in particular is expected to increase substantially, according to Telsyte senior analyst Alvin Lee, with growth predicted over the next two years. At present, only 10 tablets and 2-in-1 devices support the technology.

“Mobile-connected 2-in-1s are ripe for growth in the coming years as carriers look to increase network utilisation beyond smartphones,” said Lee.

Currently, over two million tablets are connected to mobile networks in Australia, with the Telsyte research finding that 46 per cent of respondents have an interest in connecting tablets to mobile networks, especially if it can utilise a mobile data sharing plan. 

At the more affordable end of the market, the 8-inch tablet saw a “mini boom” in the first half of 2019 according to the report, rising 16 per cent compared to the same period last year. The reason for this was due to the fifth generation of iPad mini, released in March 2019, the report claimed.

Meanwhile, 2-in-1 devices have future growth prospects, according to Lee.

“The slate-only format is rapidly being replaced by 2-in-1s as Australians seek to replace older laptops and tablets with converged touchscreen devices with keyboards,” Lee said.

The replacement period of 2-in-1 devices was also found to be shorter when compared to slate-only tablets, at 2.6 years and 3.2 years, respectively.

Further research found there are 3.9 million Australian users of 2-in-1 devices, with 65 per cent of these being Windows-based devices. However, Apple-based 2-in-1 devices are expected to increase their market share with recently released devices supporting Apple’s Smart Keyboard and iPadOS providing Apple tablet devices with an experience similar to a PC.

In terms of other smart devices, smart speakers and smart devices are both on the rise for the first half of 2019, with 20 per cent of Australian households using at least one smart speaker, up 4 per cent from the second half of 2018. 

Of these, nearly 10 per cent are using smart displays, which Telsyte research found to be doubled when compared to the end of the second half of 2018. 

“The popular smart display category gives tablet vendors the opportunity to tap into the fast growing IoT@Home (smart home) market that was already worth over a billion dollars in 2018,” Lee said.

Overall, tablets are expected to see modest demand in the second half of 2019 with a forecast of 1.5 million tablets sold for the second half of 2019, a decline of 5 per cent when compared to the same period last year. 

These trends are expected to continue through to 2020, with prolonging replacement cycles and devices like 5G smartphones and wearables taking up a larger share of consumer electronics spending.