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Welcome to the Tablet Bargain Bin
Low-priced tablets are hot.
Michael Comeau    

This article was originally posted on the Buzz & Banter, where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

The tablet industry, thought to be a possible growth leg for the consumer electronics industry, is in a rough spot.

On Thursday, IDC said the market grew just 3% year-over-year, a major slowdown from the 28.2% growth in Q4, which itself was a disappointment.

One major culprit was Apple (NASDAQ:AAPL), which saw a year-over-year decline of 16%. But the rest of the industry didn't fare much better, growing just 16.8%.

Samsung (OTCMKTS:SSNLF), which is on its way to taking Apple's market share crown, saw shipments grow 32%, but there's a catch. In its Q1 earnings report, the company said it expected competition to intensify "amid slowdown of growth trend."

So I decided to take a look at tablet demand to get a better sense of the competitive dynamics within the space, particularly for Apple and Samsung.

I tallied up the 15 best-selling tablets from the following retailers' websites: Best Buy (NYSE:BBY), Wal-Mart (NYSE:WMT), Target (NYSE:TGT), and Amazon.com (NASDAQ:AMZN).

There are some caveats: This is US only, Internet only, and it's just one snapshot in time.

Here's what I found:

1) At least with third-party retailers, Apple (which positions itself as high end) seems to need discounts to move products. Apple has nine of the 10, and 10 of the top 15 best-sellers on Target.com, but Target is offering $50 gift cards with iPad purchases.



Best Buy offers $20-$25 discounts on some iPad models; there, Apple only has three products in the top 10.



Note: I left the Kindle in there as a point of reference for pure e-readers versus tablets.

2) The Google (NASDAQ:GOOG) Android market seems to be doing OK, mostly because of the availabilty of high-quality models around the $200 mark. There's moderate discounting on new Samsung models.

However, because of the strong demand for those cheaper models, I'm concerned about the long-term growth opportunities for higher-priced tablets (both Android and Apple).

I noticed that sub-$100 tablets, many of which even come with accessories such as cases and keyboards, are very popular at Walmart.com:



So at the lower end of the income spectrum, there doesn't seem to be much propensity to pay up for fancier models.

Will those people ever become buyers of $400-$500 iPads? I think not.

3) There was only one Microsoft (NASDAQ:MSFT) tablet in the top 15 at any of the four retailers. Best Buy had the 64GB Microsoft Surface in the No. 6 slot, aided by a $100 discount off the $399 regular price. However, I'd note that in April, Strategy Analytics said Microsoft platforms had 6% tablet market share in Q1, which is better than these rankings would imply.

4) Amazon's charts are dominated by its Kindle Fire models, which makes sense given that they get so much promotion to a captive audience. As per IDC's estimates, Kindle Fire sales fell 47% year-over-year in Q1.



5) Judging by the price data, Apple could boost market share by a big margin if it cuts price. But I suspect that the company doesn't want the type of customer who's price shopping in the bargain bin.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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Position in AAPL
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Welcome to the Tablet Bargain Bin
Low-priced tablets are hot.
Michael Comeau    

This article was originally posted on the Buzz & Banter, where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

The tablet industry, thought to be a possible growth leg for the consumer electronics industry, is in a rough spot.

On Thursday, IDC said the market grew just 3% year-over-year, a major slowdown from the 28.2% growth in Q4, which itself was a disappointment.

One major culprit was Apple (NASDAQ:AAPL), which saw a year-over-year decline of 16%. But the rest of the industry didn't fare much better, growing just 16.8%.

Samsung (OTCMKTS:SSNLF), which is on its way to taking Apple's market share crown, saw shipments grow 32%, but there's a catch. In its Q1 earnings report, the company said it expected competition to intensify "amid slowdown of growth trend."

So I decided to take a look at tablet demand to get a better sense of the competitive dynamics within the space, particularly for Apple and Samsung.

I tallied up the 15 best-selling tablets from the following retailers' websites: Best Buy (NYSE:BBY), Wal-Mart (NYSE:WMT), Target (NYSE:TGT), and Amazon.com (NASDAQ:AMZN).

There are some caveats: This is US only, Internet only, and it's just one snapshot in time.

Here's what I found:

1) At least with third-party retailers, Apple (which positions itself as high end) seems to need discounts to move products. Apple has nine of the 10, and 10 of the top 15 best-sellers on Target.com, but Target is offering $50 gift cards with iPad purchases.



Best Buy offers $20-$25 discounts on some iPad models; there, Apple only has three products in the top 10.



Note: I left the Kindle in there as a point of reference for pure e-readers versus tablets.

2) The Google (NASDAQ:GOOG) Android market seems to be doing OK, mostly because of the availabilty of high-quality models around the $200 mark. There's moderate discounting on new Samsung models.

However, because of the strong demand for those cheaper models, I'm concerned about the long-term growth opportunities for higher-priced tablets (both Android and Apple).

I noticed that sub-$100 tablets, many of which even come with accessories such as cases and keyboards, are very popular at Walmart.com:



So at the lower end of the income spectrum, there doesn't seem to be much propensity to pay up for fancier models.

Will those people ever become buyers of $400-$500 iPads? I think not.

3) There was only one Microsoft (NASDAQ:MSFT) tablet in the top 15 at any of the four retailers. Best Buy had the 64GB Microsoft Surface in the No. 6 slot, aided by a $100 discount off the $399 regular price. However, I'd note that in April, Strategy Analytics said Microsoft platforms had 6% tablet market share in Q1, which is better than these rankings would imply.

4) Amazon's charts are dominated by its Kindle Fire models, which makes sense given that they get so much promotion to a captive audience. As per IDC's estimates, Kindle Fire sales fell 47% year-over-year in Q1.



5) Judging by the price data, Apple could boost market share by a big margin if it cuts price. But I suspect that the company doesn't want the type of customer who's price shopping in the bargain bin.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
Position in AAPL
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
More From Michael Comeau
Daily Recap
Welcome to the Tablet Bargain Bin
Low-priced tablets are hot.
Michael Comeau    

This article was originally posted on the Buzz & Banter, where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO+.

The tablet industry, thought to be a possible growth leg for the consumer electronics industry, is in a rough spot.

On Thursday, IDC said the market grew just 3% year-over-year, a major slowdown from the 28.2% growth in Q4, which itself was a disappointment.

One major culprit was Apple (NASDAQ:AAPL), which saw a year-over-year decline of 16%. But the rest of the industry didn't fare much better, growing just 16.8%.

Samsung (OTCMKTS:SSNLF), which is on its way to taking Apple's market share crown, saw shipments grow 32%, but there's a catch. In its Q1 earnings report, the company said it expected competition to intensify "amid slowdown of growth trend."

So I decided to take a look at tablet demand to get a better sense of the competitive dynamics within the space, particularly for Apple and Samsung.

I tallied up the 15 best-selling tablets from the following retailers' websites: Best Buy (NYSE:BBY), Wal-Mart (NYSE:WMT), Target (NYSE:TGT), and Amazon.com (NASDAQ:AMZN).

There are some caveats: This is US only, Internet only, and it's just one snapshot in time.

Here's what I found:

1) At least with third-party retailers, Apple (which positions itself as high end) seems to need discounts to move products. Apple has nine of the 10, and 10 of the top 15 best-sellers on Target.com, but Target is offering $50 gift cards with iPad purchases.



Best Buy offers $20-$25 discounts on some iPad models; there, Apple only has three products in the top 10.



Note: I left the Kindle in there as a point of reference for pure e-readers versus tablets.

2) The Google (NASDAQ:GOOG) Android market seems to be doing OK, mostly because of the availabilty of high-quality models around the $200 mark. There's moderate discounting on new Samsung models.

However, because of the strong demand for those cheaper models, I'm concerned about the long-term growth opportunities for higher-priced tablets (both Android and Apple).

I noticed that sub-$100 tablets, many of which even come with accessories such as cases and keyboards, are very popular at Walmart.com:



So at the lower end of the income spectrum, there doesn't seem to be much propensity to pay up for fancier models.

Will those people ever become buyers of $400-$500 iPads? I think not.

3) There was only one Microsoft (NASDAQ:MSFT) tablet in the top 15 at any of the four retailers. Best Buy had the 64GB Microsoft Surface in the No. 6 slot, aided by a $100 discount off the $399 regular price. However, I'd note that in April, Strategy Analytics said Microsoft platforms had 6% tablet market share in Q1, which is better than these rankings would imply.

4) Amazon's charts are dominated by its Kindle Fire models, which makes sense given that they get so much promotion to a captive audience. As per IDC's estimates, Kindle Fire sales fell 47% year-over-year in Q1.



5) Judging by the price data, Apple could boost market share by a big margin if it cuts price. But I suspect that the company doesn't want the type of customer who's price shopping in the bargain bin.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
Position in AAPL
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
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