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The arrival of tablets

In many respects, they are similar. They are both highly portable and robust, using solid state storage instead of more vulnerable spinning hard discs, and both are generally ancillary systems, not replacements for desktop machines. As with netbooks, Microsoft is late to the game. But this time, it does not have a Windows XP-type product that it can offer, and its tablet equivalent of Windows 7 is not exactly storming away: IDC forecasts that Microsoft will have just 10% of the worldwide tablet market in 2016. That wouldn't matter much if tablets were likely to be a niche market, but all the signs suggest exactly the opposite: that tablets will soon be more important than desktops for general users.

For example, it is predicted that tablets will out-sell notebooks this year:

NPD estimated tablet shipments will reach more than 240 million units worldwide in 2013, compared to the company’s projection of 207 million notebook shipments this year. This gap is significant enough that, even if NPD’s estimates are out by some margin, tablet numbers will still overtake those of notebooks.

Nor is it just the notebook sector that is suffering under the onslaught of tablets:

In the fourth quarter of 2012, worldwide PC shipments declined 6.4%, sliding to a total count of 89.8 million units, according to IDC. For the year, 352 million PCs were sold. Compared to 2011, that figure represents a 3.2% decline.

Industry analysts at Reuters are pointing a finger at Windows 8, stating that PC sales for the period fell as “Microsoft Corp’s new Windows 8 operating system failed to excite buyers.” It’s also a simple argument to make that tablet hardware took market share from full PCs, as consumers were offered a plethora of inexpensive, powerful slate devices across platforms.

Since NPD is predicting that 240 million tablets will be sold in 2013, this means that the crossover point for tablets overtaking the declining market for PC can't be far off. And after that, it's likely that tablet sales will be greater than the combined sales of PCs and notebooks fairly soon. Since the vast majority of PCs and notebooks are running Windows, that's awful news for Microsoft. Other projections underline why:

Analyst firm Gartner had predicted that the global IT device market would be worth $706bn in 2013 when it released its quarterly forecast figures last October. But it now forecasts the IT global device market for 2013 will be worth $40bn less, at $666bn.

The reason for this lower valuation is because an increasing number of people are choosing to buy budget tablet devices over expensive PCs.

That is, instead of going into sectors where Microsoft makes a tidy profit from the bundled software, money will be flowing into the pockets of tablet manufacturers – specifically, budget tablet manufacturers.

Some of those might be lower-cost Apple iPad minis, but the real budget tablet sector is already dominated by Android. Moreover, if the smartphone sector is an indicator, Android's lead is likely to increase dramatically. I'd guess that IDC's prediction that Android will have 40% of the tablet market by units shipped in 2016 will prove a huge underestimate: in just four years, it now represents 75% of smartphones shipped worldwide. I suspect something similar will happen in the tablet world.

There are two ironies here. First, that at the heart of Android lies an updated version of exactly the same code that the early netbooks ran; and secondly, the fact that Microsoft's successful attempts to kill off netbooks running free software probably contributed to Android's current success in the tablet market.

That's because by encouraging manufacturers to drop GNU/Linux offerings in the netbook sector in favour of Windows versions, Microsoft made it much harder for people to buy extremely cheap, rugged systems to run alongside their main PCs. Instead, they were offered mostly dog-slow netbooks running Windows, or fully-fledged notebooks at a much higher price point.

But with the Nexus 7 available at £199 – significantly, exactly the same price that the Asus Eee PC cost when it first came out – and a new generation of even cheaper Android tabs, once more people have the option of buying a really neat little system that is perfect for using on the move, or on the sofa. And this time, there's nothing that Microsoft can do about it: Google's Android system is well-known and accepted in a way that early distros running on netbooks never were, so manufacturers have no incentive to move to Windows as they did five years ago. Call it Linux's revenge.


Follow me @glynmoody on Twitter or identi.ca, and on Google+. For other feature articles by Glyn Moody, please see the archive.

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