Personal Computers and Mobile – Page 18

Chromebook = Netbook revisited

Almost a year and a half ago, I stated (in Japanese) that it is plainly obvious that Chromebooks will follow the fate of Netbooks.

I outlined how Microsoft would respond if they ever perceived Chromebooks to be a threat.

したがって今回は、もしMicrosoftが反撃を開始するとすれば、Acerなどの低スペックモデルに割安でWindows 8を供給し、そしてSkyDriveの無料使用分を追加する形で反撃することが十分に予想されます。Google Docsの対抗製品であるWindows 365の無料使用分を付ける可能性もあります。

This time, if Microsoft decides to fight back, they would start providing Windows 8 cheaply to low-spec models like the Acer. They would also add free SkyDrive capacity. It is also likely that they would include free Office 365 to compete with Google Docs.

That seems to be exactly what Microsoft has started to do with Windows Bing. Computer makers will start announcing PCs shortly so we should see how these will be priced. I expect prices to be very similar to Chromebook prices.

So far so good.

We can now sit back and wait for the next chapter:
“Interest in Chromebooks wane.”

Update

It is interesting to note that since Microsoft now has a cloud-based subscription revenue model in Office 365, it will be more willing to reduce the cost of Windows. According to this report, Windows 8.1 usually costs $50 per license but Microsoft is offering it for $15 on low-cost devices.

Office 365 Personal is $6.99 per month or $69.99 per year. Add the fact that all these low cost PCs will come with Bing as their default search engine, hence generating ad revenue for Microsoft, and you can see that this strategy makes sense for Microsoft even without a threat from Chromebooks.

Funny Phablets

Phablets are a very funny product category. Nobody, at least in the west, seems to quite understand what they are.

I don’t either. I’m just observing that the information that we have is difficult to understand, and the common theories aren’t logically consistent.

Here is an example of a bullish prediction for phablets.

“Are Phablets Signaling a Butterfly Effect for Mobile Devices?”

While I have a large issue with how “butterfly effect” is being used in this article, that is beside the point. The point of the article is to illustrate how phablets might lead to significant changes in the mobile space.

In this article, the benefits of a larger screen are given as follows;

“Bigger screens are becoming essential for browsing. They make it a lot more attractive – you can fit more information into a single screen.”
“Email gets easier on a big screen too.”

Now compare this with a report by Opera Mediaworks “Phablets are no passing phad”.

What they find in terms of phablet usage is;

Social networking is by far the top category (53.8% of total impressions served), far outpacing social site usage from phones and tablets.
Phablet users are far less likely to use News & Information sites than phone users and fall well short of tablet users in their interest in Gaming, and Music, Video & Media.

So it seems that phablet users are less prone to browsing the web, and are more inclined to use their device for social networking.

What kind of social networking?

We can’t be sure, but if it is a lot of WhatsApp, then we can be sure that large screens aren’t making too much of a different. The same can be said for Twitter.

This doesn’t match the phablet benefits given above.

My feeling is that nobody really seems to know what the real appeal of Phablets are on purchase and how they are actually being used. Much less whether their success will be confined to Asia or whether they will penetrate other markets.

Design And The Lack Of Intent

I read a great post today by John Moran about Intent within Apple’s designs.

Overarching intent is easy. The hard part is driving that conscious decision-making throughout every little choice in the creative process. Good designers have a clear sense of the overall purpose of their creation; great designers can say, “This is why we made that decision” about a thousand details.

When Jony Ive, Apple’s newly titled SVP of Design, criticizes a material selection or feature decision, “he’s known to use ‘arbitrary’ as a term of abuse.”

John goes to outline the “Three Design Evasions”; what most companies do instead of employing Intent.

Preserving the past.
Copy first without making the Intent your own.
Delegating design decisions to your customers.

The question is, what is holding good design back? Do we lack good designers or are corporations ruining them?

I don’t know the answer. I’m quite sure that a lot of designers are aware of Intent and consciously try hard. The problem is, I tend to find most of the celebrated designers lacking it the most. Instead, I often find good Intent and good design in kitchen utensils and other everyday tools that are not “appearance” driven.

For example, architecture. Widely acclaimed architecture is more often praised based on its appearance. Of course critics will note Intent and usability benefits. However, as an actual user of these buildings, I have never found myself appreciating the designers’ decisions. In fact, we more often tend to loath the strangely designed rooftops that invariable leak rain, and the unconventional hallway orientations that make you feel lost.

On the other hand, I marvel at the curves of my kitchen cutting knife or scissors which are truly designed to fit your hand. I wonder at the small details on the metal knife embedded in the box of my food wrap which allow me to efficiently cut the film with the minimum of strength and without it tearing in unwanted places.

Even Jony Ive’s designs used to have annoying flaws. I hated the trackpad buttons on the Powerbook G3s which looked nice, but had a very badly designed clicking mechanism. The flimsy hinge on the Titanium Powerbook easily fractured and came off. And it’s really hard to justify the design of the “toilet-seat” iBooks. There was very little Intent in those designs.

In my opinion, it was only after the aluminum Powerbooks which had very minimal ornamentation that Jony’s designs started to blend form and function.

Designing with Intent is probably really really hard. Even for Apple and Jony Ive.

Moto G Sales Figures

A quick note as I try to gauge the success of the Moto G.

Total Smartphone Shipments in 2014Q1 were 281.5 million according to IDC and 279.4 million according to Canalys.

Motorola has not disclosed how many Moto Gs they shipped, but they tweeted that they shipped a total of 6.5 million devices in Q1. They didn’t make profits, but neither do most other players.

Of the 6.5 million devices, we know that Moto X isn’t a significant portion. Maybe 0.5-1.0 million.Moto X Sales

Kantar has reported that Moto G sold well in the UK. Moto G 6% in UK Kantar Moto G report

Nokia hasn’t reported on how many they shipped in 2014Q1, but it seems like somewhere between 5.6-8.1 million. Nokia Lumia sales

For some perspective on how other manufacturers are doing, IDC has a report. Samsung sold 85.0 million and Apple sold 43.7 million. Even LG sold 12.3 million.

I would say that for an Android phone that had very strong reviews, the Moto G sold in Nexus-like numbers. That means that it didn’t sell well relative to the big players, but would be significant to a player like LG which makes the Nexus 4 and Nexus 5 smartphones. In many ways, the Moto G is a Nexus device.

It is possible that Motorola could continue to grow upon the success of the Moto G. That is not however what happened for the Nexus devices. At this point, I expect Motorola to remain in their current position at best. As the association with Google disappears, it is more likely that it will actually go downhill.

Jobs-to-be-done in India

Just happened to read an article on The New York Times with a very interesting quote;

“Micromax is giving India what it wants: more bang for the buck,” Rahul Sharma, its co-founder and chief executive, said in a phone interview. “Most Indians don’t walk into a store asking for a smartphone; they go, “Bhaiyya, isme chat chalega?” (“Brother, will the chat apps work on this phone?”)

I suspect that this is not only relevant to the Indian market, but also key to getting “late-majority” and “laggards” to switch from feature phones to smartphones, even in countries like Japan with its ferocious appetite for high-end iPhones.

This is the ultimate jobs-to-be-done for smartphones. The specs or OS or ecosystems of smartphones don’t really matter.

Thoughts on Premium

A lot of people use the work “Premium” to explain Apples iPhone strategy, and/or their strategy in general. Apple’s products tend to be priced at the high-end of the market. On the other hand, Apple tends not to sell products priced at the lowest-end of the market. This tendency is strongest for the iPhone lineup, which constitutes only of phones in the high-end; Apple does not introduce new models targeted at the lower-end, although they do sell previous-year’s models at lower prices.

Some people have suggested that Apple has a broader product range for their iPods and their Macs, and hence they are not idealistically opposed to selling products at a range of price points, going from maybe the mid-range to the high-range. My opinion is that this is not the case. My understanding is that Apple produces the absolute best product they can for a specific customer, and only provides some minor configuration options (like RAM, HDD).

Take the iMac and the PowerMac for example. It is tempting to say that the PowerMac is the high-end model whereas the iMac is the mid-range model. However, this is not the case. For the vast majority of people who buy iMacs, the PowerMac is not only an overkill. It is actually less suited for the required jobs-to-be-done. The PowerMac is designed for creative professionals who require the very best in computing power, and who will also add extra hardware to the core PowerMac. The iMac is for normal people who do not need so much power, but instead value convenience of setup and ease-of-use. The iMac and the PowerMac are not high-end and mid-range models; they are two different products targeted towards two different markets with very different needs. Hence this is not an example of Apple selling a premium product.

The same goes for the MacBook product line up. The current retina display MacBook Pro is great for creative professionals but sacrifices portability. For people who want to carry their laptops with them, the MacBook Pro is actually a worse fit than a MacBook Air. Hence the MacBook Air is not a lower-end model of the MacBook Pro, but a different product for a different segment of the market.

The exact same goes for the iPod lineup. There was never two products in the iPod line-up that targeted the same use-case with one being the premium product and the other being an entry level one. The only “premium”-ness of a product in the lineup were products with maxed-out storage.

Now let’s apply this to the iPhone. Smartphones tend to have the same jobs-to-be-done for almost every person (except those who use smartphones as a feature phone replacement). Smartphones are used for communication, taking photos, playing some games, viewing maps and sometimes watching movies or listening to music. There is no segment like the creative professionals using PCs, who use their smartphones for very different purposes that require much higher processing power and/or expandability. On the other hand, there are no smartphone users who would be content with a device without a display, like the iPod shuffle. It’s even very difficult to make the argument that the variation between the MacBook Pro and MacBook Air is necessary for smartphones, because everybody highly values portability and because retina displays are necessity even for mid-range phones.

Regarding the iPhone, the only segmentation that would make any sense is a small variation in screen size. This would be similar to the 11-inch and 13-inch MacBook Airs. The current 11-inch an 13-inch model only have $100 price difference and choosing either is more about personal preference than premium/mid-range targeting.

Looking at what Apple actually sells and the markets that it’s targeting, selling a mid-range iPhone and a premium iPhone in parallel appears to be very uncharacteristic of Apple, and I doubt that it will ever happen. I sense that Apple doesn’t ever segment markets by “low-end”, “mid-range” or “premium”. More likely, they simply segment by “junk” and “best”. Any product variation in their lineup is a result of simply targeting different jobs-to-be-done.

If you believe that this is how Apple thinks, then the evolution of the iPhone lineup is pretty obvious. They may introduce a slightly larger (or maybe slightly smaller) iPhone in the same way that they have 11-inch and 13-inch MacBook Air models. That is, specs other than the screen size will remain mostly the same. The price difference would be small and choosing either would be totally a matter of personal preference.

For the lower-end, selling previous-year’s models at discounted prices seems to be a working in developing countries.

In fact, it’s a shame that there are very few companies that take the same approach as Apple. That is, market segmentation by “junk” and “best”.

Chromebook Disruption Revisited

Although some people consider Chromebooks to be a low-end disruption to traditional laptop PCs, I have been skeptical of this for quite a while (“Why the Chromebook is not a Low-End Disruption”). In January 2013, I even outlined why Chromebooks will ultimately follow the fate of Netbooks.

The flattening of iPad sales (1, 2, 3) strengthens my conviction.

Simply said, low-end disruption is much harder than many people believe. iPads have failed to replace laptop PCs in the low-end disruption fashion; Apple is now focussing on new-market disruption as is clearly demonstrated in the new “Your Verse” marketing theme.

Even with low-end disruption, there has to be a significant new-market disruption element. Low-end disruption is more than a few hundred dollars saved or a small bit of convenience. There has to be a clear and hugely significant improvement that broadens the use-cases, thereby allowing computing to happen in situations where it was not previously feasible. The “Your Verse” campaign is trying to tell us that the iPad does exactly this.

It follows that if iPads failed to disrupt laptop PCs, the chances of Chromebooks doing the same is close to zero.

What Next?

The dust on the iPad sales decline news has mostly settled, and at least the sensible analysts have converged on the view that the cause was the rise of the smartphone; that the smartphone became good enough for many of the computing needs that tablets were previously purchased for.

So now that we have a rather adequate idea of what happened, let’s try to go forward. Let’s try to see what will happen in the future.

Tablet sales vs. PC

Up till now, the rhetoric was that tablets will overtake the PC in sales quite soon. This assumed that tablet market will continue to grow while PCs will gradually decline.

First, it is possible that the overall tablet market (not only iPads) might also slow down. Hence tablets might not overtake PCs so soon.

Second, comparing tablet sales to PC sales may not be meaningful. Whereas many analysts previously thought that tablets were replacing PCs, that does not seem to be the case. In fact, it seems to be the smartphone that is replacing tablets and also PCs.

As a result, we don’t know right now what is going to happen to tablet vs. PC sales. We are also starting to think that this question is rather meaningless.

Absolute tablet sales

We know that the tablet market is rather complex. On the high-end, there is the iPad which is used for all kinds of tasks, including web-browsing, reading books, composing emails, drawing art, playing games, watching video and a lot more. On the low-end, there are media players which are not used for web-browsing but are used a lot for watching videos.

The price points are very different, as is the ecosystem, product quality etc. With this huge difference, it is questionable whether we can discuss these two segments together; it looks like there are two completely different markets.

For the iPad segment, it is reasonable to assume that the current trend will continue. Assuming that the flattening of iPad sales is a result of smartphones becoming more capable, we don’t see an immediate end to this trend. Investment continues to intensify in mobile applications and services. On the other hand, there are few compelling applications targeting the mass-market that require a tablet to enjoy. The exception here might be Microsoft Office. The ubiquity and importance of Microsoft Office could enable the iPad version to single-handedly reverse the downward trend of iPad sales.

For the other tablets, there is reason to believe that they will continue to expand. Prices are getting extremely affordable to the point that tablet hardware is now being bundled with subscription services, such as education. That is to say that these tablets are not longer a product in themselves, but an accessory to a service. They are single-purpose devices, much like the jug that comes with your coffee maker. They do not compete with other jugs. Since customers are not making an explicit purchasing decision when acquiring these tablets, competition with smartphones is irrelevant.

Unless a new consumer killer application emerges, the upside potential of the iPad segment lies mostly in businesses and education. As I mentioned, Microsoft Office may be a big boost to the corporate adoption of iPads. The problem is that corporate and education IT are slow-moving. We do not know when adoption will kick-in at the level that we need to see a visible reversal in iPad sales trends. It make take some more years, in which case we would see a continuation of the current downward trend for a while.

Long term

There is no question that the iPad is a magical device.

Whether laptop users will embrace it for their work as a PC replacement is actually kind of irrelevant. Replacing PCs doesn’t expand the possibilities of computing if the same people are using it for the same tasks. Instead, what is really important is how iPads allow children, old people and people with disabilities to use computers. Equally important is how it allows computing in situations where it was previously difficult, like when you are standing and do not have access to a desk.

Too many people thought of the tablet as a PC replacement (and found that tablets were actually being replaced by smartphones). That was the wrong approach. Tablets will never thrive if they can only find their niche in between two strong and ever-evolving products. Tablets will thrive if they can carve out their own niche and that niche grows.

That niche is a new market segment. It is a market that did not previously exist. The majority of potential customers are not yet aware of the possibilities, or there may be roadblocks which have not yet been sorted out. Sufficient budget may not yet have been allocated to these projects. It will take time.

In the long term, I am confident that the iPad will thrive. The current levels of iPad purchases and awareness are extremely high, and it is totally unlikely that many people will or have found exciting new niches. Unfortunately none of these have yet become truly mainstream, but it is inevitable that many of them eventually will.

iBooks Author

In this context, it is easy to see that iBooks Author, the software that you can use to create beautiful multimedia books for the iPad, is a long-term play. It is an attempt to improve the quality and quantity of e-books specifically for the iPad. It has to potential to grow the iPad education niche, but it will take time.

Mid term

In the mid-term, I expect iPad sales to continue to struggle. They may even significantly decline. Keep in mind that current iPad sales are extremely high, much higher than PC shipments from either Lenovo, HP or Dell so even a significant decline does not mean that iPads will lose relevance.

I have no idea how long this will continue, or if business/education sales will be large enough to ever sustain 20 million iPad units per quarter for example.

What we do know is that the iPad still does not have a direct competitor and that looks like this will continue to be so mid-term.

Risks

The risk that I do see to the iPad business is tablet bundling with services. It is possible that we will continue to see a proliferation of single-use tablets being offered for free or extremely cheaply with education services, business solutions, entertainment subscriptions etc. These markets rarely care about providing the best possible user experience and they could prevent the iPad from finding traction in these markets.

Apple’s solution to this problem is easily predictable. They will work on the ecosystem and developer tools so that better services and solutions are uniquely possible on the iPad. The race is on.

Confusion As Pundits Try To Explain iPad Sales Decline

Following the decline of iPad sales, pundits are trying to come up with theories to explain what they are seeing. Let’s take a look at some common ones.

Market saturation theory

The iPad was released in 2010, hence the market saturation theory is saying that market saturation was reached in a mere 4 years. That is rather incredible, although not completely unthinkable given the extremely rapid uptake of this product.

The problem with this theory is that sudden flattening is not what market saturation looks like. Horace Dediu has charted the rise and fall of platforms since 1975, and we can see that a sudden flattening of sales is not what happens on saturation. Saturation is gradual, like the PC curve. Abrupt changes like the flattening seen when Macintosh sales flattened, are the result of a new product superseding the old, not saturation. In this case Windows 95.

Another issue with this theory. Searching the web, current household penetration of tablets seems to be around 50% whereas for PCs, it’s about 90%. Saying that tablets have saturated is easy, but it doesn’t explain why they saturated so early. Unless there is a reasonable explanation, “saturation” is not a cause but merely an observation of the slope of the curve.

Update: Tim Cook mentioned that 2/3 of iPad purchases are from first-time users. This makes the market saturation theory even more incredible.

The iPad isn’t very useful

Arguments like “it isn’t a production device”, “it isn’t a must have”, “there are too many things that it can’t do that a laptop can”, “it’s only good for our children to play games on” fall into this category.

The problem with this argument is that it has been true all along. Although this argument somewhat explains why people are not buying iPads, it totally fails to explain why people rapidly bought them from 2010-12.

It’s difficult to explain a huge change based on something that has been the same from the beginning.

Long replacement cycles

I do not doubt that the replacement cycle for the iPad is longer than the iPhone. I do not think however that this could have been a reason for the iPad’s sales decline.

The slowing of iPad growth started at the beginning of 2013. If this was caused by long replacement cycles, then we have to assume that the sales of 2012 were already heavily driven by replacement (with replacement cycle about 2 years) and that these sales started to go away from 2013. This is a preposterous assumption given that the iPad first went on sale in 2010. There would hardly have been a single replacement cycle before the sales started to slowdown in 2013.

In fact, Tim Cook actually mentioned that 2/3 of Apple’s iPad buyers were new to iPad. The iPad does not seem to be strongly driven by replacement sales even in 2014.

Replacement cycles are very unlikely to be the culprit. We have to look at slowing sales to first-time users.

Phablets

Some people think that large screen phablets are eating into tablet sales and that this affected the iPad. These people are confusing the markets where phablets are selling well, with the markets that largely contribute to iPad sales.

It is well known that phablets are mostly popular in eastern Asia, and that they are much less popular elsewhere. On the other hand, iPads (premium-priced tablets) sell well in western countries whereas Asia (especially China) is flooded with cheap tablets, not iPads. Phablet sales and iPad sales owe to two different markets with limited interaction.

Moreover, one can assume that a very large percentage of iPad users also own iPhones because of the shared ecosystem and brand affinity (I haven’t been able to find direct data on this). iPad demographic studies also show that iPad users are similar to iPhone users, supporting this assumption. Since iPhones do not have large screens, the iPhone-owning segment of potential iPad users will not be affected by phablet trends at all. Therefore, if the phablet theory is true, phablet owners must be the sole contributors for the flattening of sales. Their contribution must be so large so as to completely mask the buying trends of iPhone-owning iPad buyers. Quite unthinkable.

I would love to have better data to back this up, but it seems unlikely that iPad purchases are being significantly affected by phablets.

Cheaper Android tablets

If cheap Android tablets are the reason for the iPads decline in sales, we should be seeing booming Android tablets sales. This is clearly not the case. IDC is forecasting significantly slower growth for tablets in 2014 (19.4%) compared to growth in 2013 (51.6%). IDC’s data includes the ultra-low cost tablets in China so it’s difficult to isolate what is happening in the market tier that the iPad is playing in. Nonetheless, it is evident that booming Android tablet sales aren’t what’s causing iPad sales to decline.

If you look at any metric for tablet usage, you will also see that Android tablets are not being used much. It is simply inconceivable that cheap Androids are winning customers from iPad.

There is a possibility though that Android tablets are diverting customers away from tablet usage altogether. Customers interested in tablets, but not of the techie type, might be swayed by a salesperson to buy an Android. On discovering that it’s pretty useless, they may be so fed up that they won’t consider buying a tablet (including iPads) ever again. I’m actually pretty worried about this, but I don’t think that it is sufficient as an explanation for iPad’s sales decline.

My theory: Mobile Software and the Mobile Web

The only theory listed above that makes sense is the “The iPad isn’t very useful” argument. The other theories fail because they don’t agree with either the data or common sense. In the case of the saturation theory which is hard to argue against, it’s simply an observation and not a cause-and-effect.

The only problem with the “The iPad isn’t very useful” argument is that it doesn’t explain why sales grew so fast up till 2012. If iPads weren’t useful, then people wouldn’t have bought them in the first place. Therefore we have to assume that, in the beginning while sales were booming, “The iPad was very useful”. At some point, probably in 2012, that ceased to be true and “The iPad isn’t very useful” became the more dominant situation.

How could that be? What could have changed so dramatically?

My theory is based on the observation that mobile applications and the mobile web improved tremendously so that using smartphones became comfortable enough. For example, when Steve Jobs demoed the iPad on stage in 2010, he browsed the New York Times website. At that time, the NYT website was not mobile aware, and you got the exact same layout as a PC when you accessed from a smartphone. You had to pinch and zoom your way around. They were one of the first publishers that offered an iPhone application, but the quality was quite poor. It also crashed a lot. As a result, viewing the NYT website was such a better experience on the iPad compared to the iPhone and that’s probably why Steve Jobs demoed it from the sofa on stage.

Today, the NYT website is so much better on an iPhone. Even without downloading the iPhone app, you get a layout that is optimized for mobile. It’s smooth, fast, and responsive. The font size is large enough to read without zooming, even on a 3.5-inch iPhone. The experience is so much better.

The same thing can be said of virtually every major website. Every major website now is optimized for smartphones down to iPhone sizes (remember that most web designers will be iPhone owners). There are also many more apps with much higher quality. There are very few occasions now where you need to have the screen size of a tablet to browse the web. This was not true even just a few years ago.

In fact, if you are a web developer, then you will know that what enabled this explosion of mobile websites is a technology known as “Responsive Web Design”. This is based on ideas described in A List Apart in May 2010. This was the watershed moment when the mobile web really started to get its act together. Previous mobile web design attempts were frankly quite clunky. If you want evidence of this history, note that the WordPress default theme for 2010 (twenty ten) was not optimized for mobile. In 2011, WordPress adopted a responsive default theme (twenty eleven) which fully adapted to mobile for the first time (You can check how these themes look on a smartphone using a desktop browser by simply narrowing the browser window). In other words, it took until 2011 till the world’s most popular web-publishing platform became fully mobile-friendly. 2010-11 was a pivotal moment for the mobile web.

What we see is that software and web innovation dramatically improved the usability of smartphones for common tasks like checking the morning’s news. This started in earnest after 2010 and really started to kick in a couple of years after that.

Back in 2010-2012, the old days, “The iPad was very useful” compared to a smartphone for things like viewing newspaper websites. In 2014, this is no longer the case. The iPad lost a key advantage over smartphones. As a result, the iPad had to justify its existence at the other end of the spectrum, against laptops. This enforced the “The iPad isn’t very useful” argument.

In summary, software has vastly improved the usability of smartphones and allowed them to replace tablets for casual computing. Tablets have been squeezed out of its niche. Tablets still dominate some niches which are not accessible to smartphones and could continue to find growth there in smaller quantities (Tim Cook explicitly mentioned education and business). However, it is unclear to me how tablets could grow in the mainstream consumer market in the mid-term (3-5 year span).

Update

While I do have doubts on iPad growth in the mainstream consumer market (by which I mean excluding education mandated purchases), I have no doubt that Microsoft Office will be a huge force in corporate adoption. This alone could turn around the fortunes for iPad.

Explain Flat

Benedict Evans tweeted the only tweet that really makes sense about the iPad sales.

スクリーンショット 2014 04 24 10 23 06

Anybody can give multiple reasons why iPad sales might have slowed down, and the numerous replies to Ben’s tweet show that. However, none of these answer his question adequately.

His question;

It’s a great product.
It has a good price (was alarmingly cheap on introduction)
Has very wide acceptance
Has very high user satisfaction
And STILL has flat sales

I would also add;

Had tremendous growth up till 2012

Any acceptable answer has to answer all of these. It’s not easy.

Flat or declining sales in tech is something that we associate with products like the iPod or the PC. In these markets, no matter how good the product, sales will not grow because the market itself is shrinking. We often attribute this to a replacement product; a product that is making the old one obsolete. So the question is, is the iPad market being obsoleted by some other product?

We also have to answer the growth until 2012 question. If we simply say that tablets aren’t very useful anyway, how do we explain growth until 2012. We can’t.

The easiest way to think about it is that the iPod or PC cycle (from boom to bust) came in fast-forward; the nature of the market changed.