By John Gruber
Atoms: We are mostly sold out... but there is more!
Yesterday the NPD Group issued a report on U.S. tablet sales in the U.S., from January through October of 2011. Worth noting up front is that the numbers in this report are about sales — actual tablets sold to actual customers — not “shipments” from the factory to stores and warehouses. Much-reported on is that second-place went to HP, after its fire sale on the discontinued TouchPad. What hasn’t gotten much commentary is the extraordinarily contorted way that NPD reported these numbers.
The report begins (emphasis mine):
U.S. tablet sales, excluding iPad sales, soared to more than 1.2 million units sold from January through October and brought in $415 million in revenue at retail, according to leading market research company The NPD Group’s monthly Connected Handhelds Report.
“If you look at the tablet market without Apple there are a number of high-profile brands vying for that number two spot,” said Stephen Baker, vice president of industry analysis at NPD. “According to NPD’s Consumer Tracking Service, 76 percent of consumers who purchased a non-Apple tablet didn’t even consider the iPad, an indication that a large group of consumers are looking for alternatives, and an opportunity for the rest of the market to grow their business.”
“A large group of consumers”. Keep that in mind. They then report the results with the following table:
Top 5 U.S. Tablet Brands (excluding Apple)
Retail Sales Jan-Oct 2011
Manufacturer Unit Share (%) Hewlett Packard 17 Samsung 16 ASUS 10 Motorola 9 Acer 9
What makes this whole presentation so contorted is the notion of “non-Apple tablets” as a separate product category, without any context as to where these tablets stand when the iPad is included.
According to Apple’s financial results for the three quarters covered by NPD’s report (Q2, Q3, Q4 2011), 25 million iPads were sold during that period. Apple doesn’t break out sales by region in its quarterly results, alas, so that 25 million number is worldwide, whereas NPD’s report is about the U.S. market. Let’s guess that 10 million of those iPads were sold in the U.S.1 That gives us a table like this:
|Manufacturer||Quantity||Unit Share (%)|
Again, that’s based on a guess that 40 percent of Apple’s worldwide iPad sales were in the U.S. I think that’s a conservative guess. That means Apple sold about 50 times more tablets than “second place” Hewlett Packard.
Including the iPad makes statements like this, from NPD, seem absurd:
PC manufacturers are dominant in the tablet space, as four of the top five tablet brands already have a strong U.S. consumer PC presence. Only two of the top five brands play in the smartphone market.
NPD is trying to paint a picture that there’s a contest going on where there is none. I repeat the following from their report:
76 percent of consumers who purchased a non-Apple tablet didn’t even consider the iPad, an indication that a large group of consumers are looking for alternatives, and an opportunity for the rest of the market to grow their business.
That’s one way to put it. Another way is that 92 percent of U.S. tablet buyers considered an iPad, and 89 percent bought an iPad, which means 97 percent of tablet buyers who merely considered an iPad bought an iPad, and if not for the 8 percent of tablet buyers who for whatever reason did not consider an iPad, none of these companies would have sold even 100,000 tablets over the first nine months of 2011.
Also worth noting is that NPD’s numbers do not include the Barnes and Noble Nook. Barnes and Noble doesn’t release sales figures, but Digitimes, back in March, estimated sales of 3 million. That’s why I put “second place” in quotes as a description of Hewlett Packard. The iPad has competition that far outsold the TouchPad during the last nine months. And surely the new Kindle Fire will sell more units than all of the companies listed by NPD combined.
PC manufacturers are not dominant in the tablet space. Companies that provide a complete ecosystem — hardware, software, app stores, movies, TV shows, books and periodicals — are. PC manufacturers are utterly failing in the tablet market. The only thing you can learn from NPD’s report is that tablet market share numbers sure do look different when you don’t count any of the tablets that people are actually buying.
Last quarter Apple reported that 63 percent of its total revenue was from outside the U.S., but I rounded up to a 60/40 split for the iPad because I think the international numbers are skewed toward the iPhone. The iPad 2 debuted in the U.S., and rolled out internationally over a few months. If my guess of 10 million iPads sold in the U.S. over this period of time is wrong, I don’t think it’s off by much, and it’s probably conservative. ↩︎