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Tablets: Still Room For Small Suppliers At The Table

LAS VEGAS — Small tablet suppliers are gaining market share as they satisfy demand for low-price models and fill in fledgling niches, such as the children’s and automotive markets.

Many of these companies will flex their muscles at International CES by launching new Android products. The brands include Kurio (from Techno Source and KD Interactive), MeeBox, Naxa, Nextbook (from E Fun), Polaroid, Tarantula, Vivitar and YiFang Digital.

Other small tablet players that recently entered the market include Monster and E&S International Enterprises, which licensed the Pioneer name for a $99 7-inch tablet launched on in late 2013. Van Nuys, Calif.-based E&S distributes consumer electronics, appliances, housewares, sporting goods, toys and other general merchandise.

Canalys sees such small companies gaining share in the Android tablet market, which Samsung dominated in the third quarter of 2013 with 27 percent share of Android tablet shipments. “The rise of small- to micro-brand vendors has proved that there is a demand in for entry-level Android tablets in every country and in every region,” said Canalys analyst James Wang. “With the cost and time-to-market advantages afforded by their Chinese supply chain, these small- to micro-brand vendors are eating up tablet market share. Vendors such as Nextbook in the United States and Onda and Teclast in the People’s Republic of China ship more units than some of the major international top-tier vendors in their home countries.”

Meantime, “vendors such as Acer, Asus, HP and Lenovo have all entered the price war with entry-level products at sub-$150 price points,” Wang continued. But “with vastly different cost structures, these vendors will continue to find it extremely challenging to keep pace with local competitors, especially in APAC and Latin America.”

The tablet market, he said, has already started to see casualties.

Apple’s focus on maintaining its position as a premium brand is also making room for small, lowprice tablet makers to expand, and a growing market is making room for them. In 2013, worldwide tablet shipments grew 53 percent to 184.4 million units, and 2014 shipments are forecast to grow 43 percent to 263.2 million, Gartner statistics show.

Chetan Sharma Consulting found that in late 2013, tablets were “making a tremendous impact in the post-PC era.” In the U.S. market, the company said, “we are already approaching 100 million unit sales/ year run rate.”

Overall U.S. tablet growth, nonetheless, is slowing, with U.S. unit shipments having grown 111 percent in 2012 to 58.7 million shipments, grown an estimated 34.8 percent in 2013, and are forecast to grow 10.1 percent in 2014 to 87.2 million units, Futuresource Consulting said. Growth in factory-level dollar value rose 40 percent in 2012 to $17.2 billion and an estimated 11.6 percent in 2013. Growth is forecast to slow in 2014 to 2.6 percent to $19.7 billion.