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BestBuy CEO, Tablet Sales Are "Crashing"

 2:34 pm on Jul 31, 2014 (gmt 0)

He admits crashing is too strong a word, but he used it.

When tablets hit town the only way was up. Now that many people have got one, or even a second hand one, the innovation is not good enough to be worth a replacement.

I'm sure there will be problems coming with the older tablets as the OS and apps become more memory hungry, and those with low levels of non-expandable RAM will soon find them stuffed with data. And, of course, the battery expires. That'll be the time to upgrade.

This is very similar to almost any tech product. Product lifecycles are shorter, of course (introduction, growth, maturity, decline). With individual products, manufacturers maintain sales by introducing new innovative products.

Think VHS video vs DVD: It was a big enough leap in innovation. Think DVD to Bluray. Not a big enough leap to make it a must have.

However, in the instance of the tablet, it was a leap in terms of computing and the Internet. Now, the new tablets are not that much better than the old, so no 'need' to upgrade for extra features. The upgrade will come when the product fails, and/or the repair cost becomes prohibitive.


The tablets boomed and now are crashing. The volume has really gone down in the last several months. But I think the laptop has something of a revival because it’s becoming more versatile. So, with the two-in-ones, you have the opportunity to have both a tablet and laptop, and that’s appealing to students in particular. So you have an evolution. The boundaries are not as well defined as they used to be.BestBuy CEO, Tablet Sales Are "Crashing" [recode.net]
You said the tablet had “crashed.” Do you believe it’s going away?

Yeah, “crashed” is a strong word. So, the tablets have been an unbelievable phenomenon. I don’t think there’s a category that ever took off so quickly and so big in the history of tech.

The issue has then been that, once you have a tablet of a certain generation, it’s not clear that you have to move on to the next generation.



 2:59 pm on Jul 31, 2014 (gmt 0)

I used by last laptop for five years (and then it was passed on to the kids, not thrown away) and I have used desktops for longer. Why do I need to upgrade to the "new generation" of tablets?

I think tablets will have a shorter average replacement cycle than laptops simply because they are more fragile (the same is true for laptops vs desktops), but a lot of people (myself included) will be perfectly happy with cheap tablets, so we may still spend less.


 3:43 pm on Jul 31, 2014 (gmt 0)

Tablets offer a very limited computing/Internet experience. I have never seen the need to buy one.


 4:37 pm on Jul 31, 2014 (gmt 0)

I wonder if Chromebooks are often cheaper, easier and a better experience. On Amazon, they seem to be selling tons. Sort of a half-laptop, half-tablet area people are moving towards?


 4:42 pm on Jul 31, 2014 (gmt 0)

I bought one a few years ago, and the main use I've found for it is reading things like ebooks and articles. It's better for that purpose than desktops and laptops, and it has a bigger screen that e-readers like the Kindle.


 5:02 pm on Jul 31, 2014 (gmt 0)

Tablets offer a very limited computing/Internet experience. I have never seen the need to buy one.

Nor me.


 5:04 pm on Jul 31, 2014 (gmt 0)

I cannot prize the iPad from my wife! It's used for a variety of things, and primarily, a web surfing and e-mail facility, along with the capability to watch video (movies and TV) anywhere she's in range of the WiFi. It's smaller and lighter than the laptop, and can rotate the display easily to suit the use.

However, she finds it's not good for letters (or typing longer documents), banking, spreadsheets, and printing, and resorts to the desktop computer for those functions.

I don't doubt she'll buy another tablet of some sort when this one fails, but there's no urgency to "upgrade."


 5:31 pm on Jul 31, 2014 (gmt 0)

Seems like innovation stopped after Steve Jobs died. Either you do the tablet better (the way Monteverdi shamed those who claimed the Madrigals were dead) or move on, take it to the next level and invent the opera (which is what Jobs did best, popularize new product categories).


 6:10 pm on Jul 31, 2014 (gmt 0)

Now that many people have got one, or even a second hand one, the innovation is not good enough to be worth a replacement.

This is the reason. Everyone who wants a tablet has one, they hold up well, and there's been nothing so amazing in tablet innovation that warrants buying a new one.


 7:15 pm on Jul 31, 2014 (gmt 0)

I never understand why businessmen expect sales of a new product to continue to rise once the market is saturated. Or maybe I just have too much common sense to make a fortune!


 7:20 pm on Jul 31, 2014 (gmt 0)

I went from an iPad 2 to an iPad mini. I only did that to get a lighter version with a smaller screen (easier to travel with). I have no intentions of replacing it until it can't run new apps in like 3-5 years. If I even still use it LOL. I anticipate a slightly larger iPhone will replace my use of an iPad.


 8:51 pm on Jul 31, 2014 (gmt 0)

In the light of this post:

I work as an affiliate for a communication company. When comparing conversion between tablet and smartphone like devices, the difference is tremendous. While using it to browse, people simply don't order via their tablets, while they have no trouble doing it over their phones.

I wonder why is this, and now I'm trying to draw some parallels with this "crashing" sales comments.


 9:07 pm on Jul 31, 2014 (gmt 0)

Another chicken little post in that the sky is continuously falling.

First it was the death of the desktop, killed by laptops and again killed by tablets. Yet desktops still exist and dominate the office landscape.

Tablets were THE BIG THING, just like phones, but here's the problem:


Early desktops sucked and you almost needed to buy a new machine with each Windows upgrade until around Windows XP. Desktop speeds got so good, and I don't buy low-end gear, so I was still using a 7 year old box that was still getting a screaming fast rating by Windows until the motherboard fried last year. I finally caved and got a new box.

Likewise, early tables and smart phones were slow and sucky as well needing almost a bi-annual update. That too changed a couple of years ago and Samsung Galaxy II phones still run just fine, fast enough that I don't feel the need to upgrade yet and they're up to a Galaxy 5 now!

The original Nexus 7 is still fast enough. Bought my wife the upgraded Nexus 7 for her b'day but my daughter's el cheapo tablet died so I got her the original Nexus 7 (New) which is almost half the price and still fast enough, she's thrilled with it.

So the market hasn't dropped out, people still buy them, but the need to replace them like broken toasters every could of years has passed.

I think the term is called: MARKET SATURATION.

Then you have the hold outs that don't buy them for whatever reason while the rest of the world loves them. Eventually they'll cave and the next wave of new sales will happen, or whether they like tablets or not they'll inherit one when someone upgrades or get one for a present.

But everyone WILL be assimilated :)

I personally can't imagine life without one.



 9:29 pm on Jul 31, 2014 (gmt 0)

I think the term is called: MARKET SATURATION.


What percentage of the non-Miss-Daisy population buys a new car every two years?


 9:39 pm on Jul 31, 2014 (gmt 0)

What percentage of the non-Miss-Daisy population buys a new car every two years?

My buddy does, he leases them, always drives new, a lot of people do that these days.

My wife and I, on the other hand, have two 14 year old cars. We're about to replace mine which is the highest mileage, but that's just because I want a new car. I easily could survive with this car a few more years.

The problem with PLANNED OBSOLESCENCE with tablets and it gets really hard to do because this years high end units become next years discount models, so they're good for at least 5 years.

I'd even speculate the latest units hitting the market might even have a 10 year life span as they're so fast the video is flawless, have tons of memory, and everything else is on the cloud.

They're really just cloud access devices for the most part which really doesn't require upgrades to access more stuff on the cloud.


 4:00 am on Aug 1, 2014 (gmt 0)

Are we reading the same computer market reports? Pad sales are immense, these days... they just are "computers"...

Kiddies... really! The death of "pads" is a bit premature. :)

More inclined to believe that BEST BUY has seen the best of its daysl, and IT is crashing...


 5:21 am on Aug 1, 2014 (gmt 0)

It occurred to me earlier today that BestBuy may have been sold a bill of goods that is not working out as well as planned. Lumping the industry into their own situation to keep from being seen as behind in the curve.


 4:09 pm on Aug 1, 2014 (gmt 0)

There is other evidence to suggest tablet sales are not what they were.

Apple's latest results showed a decline in iPad sales, which is a high end product, and of course, was the original to market.

Apple said on Tuesday that unit sales of the iPad—the best-selling tablet on the market—fell for a second straight quarter. IPad revenue has fallen in four of the last five quarters, and recent evidence points to slowing sales for imitators that rushed their own tablets to market.Four Years After First iPad Appeared, Questions Remain About Place in Market [online.wsj.com]

Apple shipped 1.3 million less iPads year on year but Samsung gained only 100,000 units, yet the market for tablets grew 11%, according to IDC.

Apple slipped in a growing market while Samsung barely held its own. Both lost market share.Welcome To Tablet Transformation [forbes.com]

Low-end tablets are taking up the slack from the premium end, but even so, it's not terrible, it's just a shift in the market.

This is all important to us as we have to deliver sites to the different platforms.

My wife and I, on the other hand, have two 14 year old cars. We're about to replace mine which is the highest mileage, but that's just because I want a new car. I easily could survive with this car a few more years.

You know, there's a big difference between keeping a car running longer, and retaining and old computer or tablet. The car, mainly, just needs to get you about safely. Technology in computing reached a point where, as you said, folks had to upgrade to be able to run the new programs. Older machines couldn't do that, so there was a good reason to upgrade. Now, that reason to upgrade is no longer there.

Importantly, don't get me started on cars. ;)


 7:02 pm on Aug 1, 2014 (gmt 0)

Apple's latest results showed a decline in iPad sales, which is a high end product, and of course, was the original to market.

What you call high end I call overpriced.

Apple is a cult, a cult of the wealthy or the wannabes. People that can't afford a BMW or a Lexus could probably scrape together enough cash to get an iPad as a mini status symbol. When Apple used to claim the Mac was a "The Computer for the rest of us" it should've been "The Computer for the rest of use that can afford it".

I'm hardly poor, far from it, but I can buy two high performing Nexus tablets for the price of one iPad. That's how I keep my money in my bank and don't become part of the machine funding Apple's $150B war chest, which exceeds the amount in the US treasury. No thanks.

The only reason we have an Apple laptop and iPhone in this house is for my wife's job. The rest of our gear is Android and windows, which spreads the wealth around and doesn't just add to the Apple stockpile.

Apple was hardly the first to make a tablet, they were just the first to market it to the masses the way they did.

FWIW, and I've told people this before, I had an 8x10 sized Windows tablet or slate, whatever you want to call it, back in '91 running Win 3.1 with pen handwriting conversion in it's infancy. Those old machines were way overpriced, low battery life, and tended to be sold into places like the medical community as you might remember doctors using these things a long time before the iPad was ever conceived. Had MS any vision, they'd own the portable marketplace today, but they're idiots and did everything wrong.

When you see Apple suing Samsung, Asus, etc. it's more about keeping the prices at a premium than copying because those other companies from Asia bring it cheaper to the masses, not just the masses willing to overpay.

Before I end this rant, the Apple Genius Bar is a disservice to the words Genius and Bar and should be illegal. ;)


Anyway, that's another part of Best Buy's problem is that they tend to only sell the higher end tablets and other retailers like Walmart and Amazon sell a bunch of the low end stuff where you can get Android tablets as low as $50 and they actually WORK!

If you don't believe me, just ask my grandkids. When we got them all tablets last Xmas we got 3 machines for the price of one Nexus machine.

You don't find stuff that cheap at Best Buy.


 10:26 pm on Aug 1, 2014 (gmt 0)

Everyone who wants a tablet has one

Yeah, I'm probably not typical. I really want a tablet and have done since 2011... but I don't have one. Yet.

The Nexus 10 II specs come closest to the kind of thing I've been looking for... I already have an excellent smartphone (iPhone 4S) so if I'm going to buy a tablet I want it to be a lot bigger than my phone - at least 10".

But the Nexus 10 II has become, it seems, the stuff of myth...


 11:58 pm on Aug 1, 2014 (gmt 0)

A little over two years ago I bought a tablet. Two months later I bought a Samsung Galaxy S3 (now have and S5). Have barely used the tablet since I got the S3.


 8:46 pm on Aug 3, 2014 (gmt 0)

A little over two years ago I bought a tablet.

Most tablets (and phones) sold much over 2 years ago were crappy compared to a Galaxy S5. A more modern Nexus you might find more usable.

Like our first tablet, the Nook, which was priced right and fully featured at the time was quickly obsolete and now unused but the 2 Nexus units are in constant usage around here.

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