The Tablet Breakout.

ipad3A few months ago in a year-end Struming, Smartphones: Breakout Product of 2011, I suggested that smartphones were the product of the year. Smartphones were hardly new in 2011, and in fact have been in existence for the last decade. However, my point was that smartphones had become so widespread in 2011 that their use had now changed how the American public communicated, obtained information, and bought products and services.

Fast forward to 2012 and, even at this early point of the year, I now suggest that tablets are the 2012 breakout product of this year. Tablets are also not new since Apple introduced the iPad two years ago in early 2010. But recent events are putting tablets in the hands of more and more Americans as tablets, much as smartphones did in 2011, reach the “marketing tipping point”.

First of all, last fall Amazon introduced its Kindle Fire. Its smaller size and importantly smaller price ($199) made it a holiday favorite as Amazon sold 4+ Million units in the 4th quarter. Not be usurped, Apple followed up on its 2011 iPad 2 launch with last week’s announcement of a yet more advanced, new iPad. The new iPad will be on sale later this week and will be able to run on faster 4G networks. Further fueling the market is that Apple will discount the entry price of the iPad 2 by $100 to $399.

In terms of penetration of the American households, a new Forrester report projects that 112.5 million U.S. adults — one-third of the adult population — will own a tablet by 2016. Expectations are that U.S. tablet sales will reach 38 Million this year and will climb steadily. Furthermore, eMarketer indicates that 55 Million Americans will be using a tablet by year end, and Deloitte predicts that 5% of 2012 tablet sales will be to people who already own a tablet

Tablets were initially viewed by some as technology with a weak reason for being. Not as functional as a PC, nor as portable as a smartphone, said the naysayers. But only 2+ years later, tablets are become so widespread that shopping habits are changing as a result. In fact Apple chief executive, Timothy Cook, predicts the day will soon come when tablets outsell PCs. “From the first day it shipped, we thought — not just me, many of us thought at Apple — that the tablet market would become larger than the PC market, and it was just a matter of the time that it took for that to occur,” said Cook recently. Clearly the iPad is not a side line product for Apple as roughly 20% of its holiday revenue was generated by iPads.

Whether tablets pass PCs or not is not the issue for the near future. The reality is that tablets are not to be dismissed and their “leisure like” use makes them even more powerful since their users are more engaged with the content they are viewing.

All hail the tablet, the odds on favorite for 2012 breakout product of the year. Do you have the fever?

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  1. Larry Chrzan says:

    Tablets – I’m just not getting it… at least not from Apple. (Not a fan of Apple products and their propriety nature.) I get that tablets are cool. And I’m sure they are useful in some respects. And I could go buy one if I wanted to. I just don’t want one. And I’m pretty sure if/when I do, it will be something not made by Apple.

    Maybe when I can make a phone call from a tablet and not have to have my phone and a tablet too… maybe then.

    • Lonny Strum says:

      Larry, I’m not an Apple guy either, but alas we are a declining breed. I have a tablet (an Android one) and I wish I had bought an iPad and will do so soon.

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