But there’s also another proposition, a $75-$150 black generic
Chinese Android tablet, half the price of a Nexus 7. That
proposition is also selling in huge numbers, but it appears to
come with a very different type of use.
Why are people buying these? What are they being used for? They’re
mostly in China (that’s the pink bar above) and emerging markets
and in lower income groups in the west. And it seems that they’re
being used for a little bit of web, and a bit of free gaming.
Perhaps some book reading. And a LOT of video consumption. In
fact, one might argue that for many buyers, these compete with
TVs, not iPads, Nexuses and Tabs. But regardless of what they’re
being used for, they’re not being used the way iPads are used. In
effect, they are the featurephones of tablets.
If this theory is correct, it suggests that Apple’s $300 Mini
really isn’t a competitive problem, because the iPad doesn’t yet
face a strong competitive threat (quite unlike the iPhone).
Rather, there are actually two quite different markets: the
post-PC vision, where Apple is dominant, and a ultra-low margin
product that’s also called a tablet but which is really a totally
In short, Apple’s share of the overall “tablet” market is shrinking, fast. But the part of the market where the iPad is not dominating is nothing at all like the part where it is.