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Talk of the Day -- Tech titans to square off in Q4 tablet market

2012/09/17 23:04:24

The global tablet computer market will see a fierce battle in the fourth quarter as four tech giants -- Apple, Amazon, Google and Samsung -- are launching new models to seize a bigger share of the growing pie, according to local media reports.

Citing data released by market research firm IHS iSuppli, the reports said mobile devices such as smartphones and tablets are replacing personal computers (PCs) as mainstream Internet tools.

For the first time since the 1980s, the IHS data shows, PCs no longer account for a majority of the demand for DRAM memory chips.

In the second quarter, only 49 percent of all new DRAM chips were used to make PCs, according to the IHS report.

The research firm also said Apple continued to dominate the tablet market in Q2 of the year, commanding a 69.6 percent share of the market.

In comparison, Apple's main rivals -- Samsung, Inc. and Taiwan's AsusTek -- only managed to secure single-digit market shares in Q2, according to IHS data.

With Christmas approaching, Apple is scheduled to launch the iPad mini early next month to vie for an even bigger share of the pie.

Amazon and Samsung have already launched their new devices -- the second generation Kindle Fire and the Galaxy Note2 -- while AsusTek has joined forces with Google to market the Nexus 7.

According to an IHS estimate, tablet computer sales could exceed 20 million units during the Christmas season.

Local media reports also said Pegatron, an offshoot of AsusTek and JLJ Holdings in Singapore, has outpaced the Hon Hai Group, the world's largest contract electronics maker, in the race to assemble the iPad mini for Apple.

The following are excerpts from local media coverage of the latest market trends in the technology sector:

Economic Daily News:

Sources close to the iPad mini supply chain said local components suppliers began shipments in August. Touchscreen panel manufacturers AU Optronics and TPK have benefited from iPad mini orders, the sources said.

Because the iPad mini uses a new generation connector, Taiwanese supplier Cheng Uei Precision Industry will see its September revenues break the NT$10 billion mark, the sources said.

With Apple seeking to ensure the smooth delivery of its iconic iPhones and iPads, the company is building a second supply chain, industry insiders said.

Hon Hai used to be Apple's main assembler, but industry sources said Pegatron has secured orders to assemble 50 to 60 percent of the iPad minis to be delivered in Q4.

Starting this month, monthly production of the 7.85-inch iPad mini will reach 5 million units, the sources said.

Moreover, the sources said, Pegatron has also won orders to assemble the iPhone 5 for Apple. If all goes well, Pegatron will begin iPhone 5 shipments in Q4, the sources said.

Neither Pegatron nor Hon Hai would comment on reports of Pegatron's success in penetrating Apple's iPad mini and iPhone 5 supply chains.

According to IHS data, Apple shipped 17 million iPads in the second quarter, compared with Samsung's 2.25 million units and Amazon's 1.02 million units.

Samsung's share of the overall tablet market was 9.2 percent, Amazon's Q2 share fell 13.3 percentage points to a mere 4.2 percent, and AsusTek had a 2.8 percent share.

The IHS report concluded that Apple's dominance is not likely to be threatened any time soon.

Meanwhile, it forecast that by the end of 2013, PCs are expected to soak up a mere 42.8 percent of DRAM chip output, with the rest split between smartphones, tablets and other devices.

Since Apple launched the iPad in 2010, tablets have been eating into PC sales, cutting the profits of long-time PC heavyweights such as Hewlett Packard and Dell, the report said. (Sept. 17, 2012).

(By Sofia Wu)