Tablet Slump Predicted as More People Buy Phablets

Following a bigger-than-expected decline in demand during the first quarter, research firm IDC on Thursday announced it has lowered its 2014 worldwide tablet forecast.

IDC now predicts shipments of 245.4 million units this year, down from 260.9 million. The new projection represents a 12.1 percent year-over-year growth rate, but that's 'notably lower' than the 51.8 percent year-over-year growth in 2013.

The adjustment comes after IDC earlier this month announced that worldwide tablet and 2-in-1 device shipments fell 35.7 percent in the first quarter. Tom Mainelli, program vice president of devices and displays at IDC, pointed to two major issues causing the tablet market to slow down.

'First, consumers are keeping their tablets, especially higher-cost models from major vendors, far longer than originally anticipated. And when they do buy a new one they are often passing their existing tablet off to another member of the family,' Mainelli said in a statement. 'Second, the rise of phablets - smartphones with 5.5-inch and larger screens - are causing many people to second-guess tablet purchases as the larger screens on these phones are often adequate for tasks once reserved for tablets.'

In the last year, phablet demand has more than doubled, IDC said. In the first quarter of 2013, phablets accounted for 4.3 percent of total smartphone shipments. Fast forward a year, and that figure grew to 10.5 percent, representing 30.1 million units.

It isn't all bad news for tablets, though. IDC expects things to start looking up as tablet-makers turn their attention towards even larger-screen devices, such as Microsoft's 12-inch Surface Pro 3 .

'The shift back toward larger screens will mark a welcome sea change for most vendors as the average selling price for these devices will remain roughly 50 percent higher than the average sub-8-inch device,' said Jitesh Ubrani, research analyst for IDC's Worldwide Quarterly Tablet Tracker. 'Microsoft is also expected to benefit from this shift as the share for Windows-based devices is expected to double between now and 2018.'

In a separate report, IDC predicted a 23.1 percent increased in smartphone shipments this year over 2013. Leading the pack will be Android-based phones with 80.2 percent of the market, followed by iOS with 14.8 percent, and Windows Phone at 3.5 percent.

For more, see PCMag's roundup of The 10 Best Tablets.