SAN FRANCISCO—Intel Corp. is rapidly expanding its presence in the media tablet market, according to analysts who believe Intel's potential to generate sizable profit in the tablet space is underestimated by investors.
In a report circulated Monday (April 29), Ross Seymore, a research analyst from Deutsche Bank Securities Inc., said Intel has a market share of more than 90 percent of Windows-based tablets. Windows-based tablets accounted for a surprising 7.5 percent of the tablet market in the first quarter, according to data released last week by market research firm Strategy Analytics Inc.
Seymore said Intel expects its tablet SoC shipments to double in the second quarter compared with the first quarter as it continues to ramp the Clover Trail version of its Atom SoC for Windows 8 and Lexington for Android.
Source: Strategy Analytics
Second quarter tablet shipments are expected to remain essentially flat with first quarter shipments, according to Seymore. Shipments of Apple's iPads—still the leader in market share—are expected to decline sharply, Seymore said, which implies significant market share gains for Intel.
"We note that Intel had essentially no presence in tablets in 2012 and therefore any presence in 2013/2014 yields share gains and a revenue generator to at least partially offset weakness in the traditional PC market," Seymore wrote.
Windows tablets featuring Intel's Clover Trail Atom SoC are now available at price points as low as $449, Seymore said. These tablets largely negate any bill of materials savings offered by ARM SoCs while offering similar performance and power efficiency, he said.
Finally we can stop hearing the mantra that Intel needs to get into the handheld market. Let's hope anyway.
I'm nor sure which of the Surface tablets has caused this turn-around in the trade press reports. If it's the Surface Pro, which to me seems like an improved next generation netbook-like product, that would make a lot of sense. People by now MUST have noticed the limitations of all of the previous tablets on the market, right?
They still do. this is no different than calling all Windows PC's "tablets" all of the sudden, and then declaring Intel the winner with 80% of the tablet chip maker.
This is exactly what happened here, just at a smaller scale. They only called "some" of the new Windows PC's "tablets".
To actually "gain" something, Intel needs to make "new" tablets, not just devices that they would've sold anyway as notebooks.
Thank you ChipMaster or stating the obvious. Strategy Analytics publishes bombastic findings to sell its services - one can understand that misinformation. Why Deutsche Bank and EETimes play is far less obvious.
Tablets and various x-86-based hybrids are apples and oranges -- nobody benefits by confusing terminology.
I agree 100% but the sad thing is the atom costs 4X as much in the 1-3 watt range as even a TI, freescale, or competitor's microprocessor range... $40 is still not bad. But a lot of makers will pick the $13 chip... Of course in volume it's much cheaper for both sides... The only real issue is the price, which is just solved by time and adoption. The quality is there though...
Yeah, when having the choice between a dual core Atom that costs $40, and a *quad core* Cortex A15 (that also happens to be much faster per core than Atom) for only $20, it makes very little sense for manufacturers to go with Intel.
Intel's only hope is to be at least part of the declining Windows market, where you may actually need x86 processors for some power users.
the 7.5% mainly came from Intel based windows tabs. which are mainly people who switched from notebooks to ultra portable formfactor.. so intel lost market share somewhere else to gain the market share here. Not a great achievement IMO.
"Shipments of Apple's iPads—still the leader in market share—are expected to decline sharply, Seymore said, which implies significant market share gains for Intel."
iPad shipments will be declining only in the analyst's imagination. market share. yes maybe.. in any case, the android camp is selling 199$ tabs at-cost making no money for the engineers or the companies(except google/amazon). whats the point?
"intel lost market share somewhere else to gain the market share here." Yes, but that market share would otherwise have gone to Android and Apple (who get their market share from laptops), which means Win8 tablets are successfully competing against iOS/Android tablets.
Besides, even Apple project lower sales of iPad in Q2 than Q1, with an increasing share going to the less expensive iPad mini.
furthermore, with a SoC processor capable of running Android, Intel will be able to tap into the Android tablet market as well.
Ergo, Intel will be increasing at the expense of ARM/Qualcomm. That's the point!
It wasn't that long ago when word was that Intel was going to have its clock cleaned by ARM. This article isn't saying the opposite, but I think it's a clear indication that the battle is far from over.
At the moment, Intel seems to have the upper hand in processing power while ARM has the upper hand in current draw. I expect the two will keep getting closer for a while before the real battle begins.
When are analysts expected to accurately foretell the future? "... Intel was going to have its clock cleaned by ARM" was purely a hype from brain-damaged editors or analysts. Anyone with sane mind and reasonable IQ should have dismissed it when first heard.
At the end of the day, no one formula is forever winning. Every solution has its strength and weakness. Intel was the king of microprocessor. Its position is now significantly weakened. Demised, not for the next 2 to 5 years. Possible in 10 years though. Time will tell.
A large proportion of new iPads are bought by people who owned earlier iPads. The market for iPads, as they stand at the moment, is beginning to saturate - so the proportion of new sales will dwindle. Android pads have a much wider range from small to large, cheap to expensive, and thus a wider potential market - their share (and absolute numbers) will increase for a good while yet.
Windows tablets are quite new, and there is a definite market area for them. But I don't believe the potential share is very high. Windows RT (the "pad" version) has been a total failure - the Windows "pads" that sell are actually Windows laptops with a removable keyboard. These won't go away for a while yet, and they are mostly using Intel processors, but they will not take any sales from Android or Apple customers.
If Intel really wants to get a big share of the tablet market, they should target high-end Android pads.
But that's the thing. They didn't make any "gains" per se. They are just calling some of the Windows 8 devices (which Microsoft taught us to also call PC's) "tablets". But the PC/Windows market is still declining, "Windows tablets" or not.
the best selling intel tablet product is the microsoft surface. if u look at the specs below you can find the CPU is a full fledged ULV Intel Core i5 X86 chip with HD4000 graphics, which costs roughly 150-200$ in 1K units. This is basically a repackaged PC in a ultra portable form factor.. not a tablet, ie consumption device, in the traditional sense. the people who opt for such a device are the regular pc users, who were hesitant to shift to the tablet formfactor just because they couldnt use their existing softwares. So you can count this as the market share which " would otherwise have gone to Android and Apple" .
", even Apple project lower sales of iPad in Q2 than Q1" well if you check the history a bit you will understand that Apple sales numbers are extremely cyclical with Q2 having low sales, due to anticipated new product release in Q3 beginning. you should also checkout the projected sales in Q3, and Q4 which comes after Q2 :)
"furthermore, with a SoC processor capable of running Android, Intel will be able to tap into the Android tablet market as well."
At this point Android tablet market is totally out of Intel's reach with market being spoiled by manufacturers selling devices at 100-200$. Intel cant compete unless they plan to giveaway free money as chips.
All this talk about intel increasing market share in "tablet" segment is total non sense. They are still selling the notebook category X86 chips at 100+$ and calling it "tablet" market. Thats what it is .
More PR spin from Intel. This happened only because $1,000 Windows hybrids are now also called "tablets".
Intel didn't actually "gain" anything. They just renamed part of their market as something else, and called it a "win".
But the truth is that's just part of the declining PC market, Intel may be "gaining" share in the PC market, by renaming these devices, but they will keep on losing revenue.
Just like the ExperiaZ smart phone in general, the new Sony ExperiaZ Tablet aimed at the LTE networks is rapidly gaining momentum in at least Japan. I visited a component supplier for these usits, who told me, that they have been flooded with orders they are now doing their best to expedite! But then again, that's all Android, right?
@Simon7382, I don't know that people are overly negative on Intel. It's just reality that Intel is still struggling for market share in mobile devices. ARM and Android tablets are very low profit margin devices. In order to compete Intel will have lower profit margins as well. As others have noted, nothing lasts forever and X86 compatibility matters less with each passing day.
I didnt realize that this MSS comment is based on surface pro... which is a PC in tablet formfactor. this is a core uP, Not Intel SOC, and we already know Intel is awesome at PC processors.
Intel will dominate the $900 and up PC that "looks like a tablet" market. Which is 100% taken from Laptops.
Side note: Good call by previous posts on pricing and margins. Intel is not set up to make money on SOCs yet. If Intel suddenly gained 50% share with SOC, it would lose tons of money. This is clear in the recent earnings announcement showing P&L for group containing SOC program
why is that? I would tend to not argue with you, since Intel has created a monolith org around $150-$300 chip ASPs. But why could it not manufacture and sell $20-30 SoCs and make money, if TSMC and fabless chip vendor can together make money?
Or are you saying that Intel's gross margins would dive... that's different than losing money.
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