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Topic: Tablets

Post-PC devices: Samsung's got the sales, but Apple's making the money

Summary: The latest figures for 'smart connected devices' show that while Samsung's still selling more units than its rival (just about), Apple's far and away the leader on margins.

Liam Tung

By Liam Tung |

When it comes to 'smart connected devices' — think PCs, tablets and smartphones — Apple's iPhone 5 and iPad mini have put it within a whisker of leader Samsung.

Samsung accounted for 21.2 percent of the 378 million devices shipped in the last quarter of 2012, placing it just ahead of Apple's 20.3 percent, according to analyst firm IDC. Apple has gained five percentage points since the previous quarter, compared with Samsung's one percent rise. Samsung overtook Apple as market leader by shipments last year, due largely to the South Korean company's increasing smartphone sales, IDC said.

IDC estimates there were 1.2 billion smart connected devices shipped last year. The multi-form factor category was worth $168bn for the fourth quarter, which Apple dominated with 30.7 percent of revenue, while Samsung accounted for 20.4 percent. 

Tablet forecasts

IDC expects last year's tablet shipments of 128 million to grow 48.7 to 190 million units by the end of 2013, by which time they will overtake desktop shipments, which reached 148 million in 2012. Desktop shipments are expected to decline 4.3 percent this year.

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It does not expect tablets to surpass last year's portable PC shipments of 202 million until 2014, in line with the timeframe fellow analyst firm Canalys has predicted. Portable PCs shipments will be practically flat at 0.9 percent growth, said IDC.

IDC's timeframe for tablets to surpass PC shipments flesh out a forecast in February by analyst Sameer Singh, who predicted tablets could overtake PC shipments as early as Q4 2013.

The fastest growth is expected to come from emerging markets, where IDC notes tablets grew 111 percent in 2012, compared with 62 percent in mature markets.

Smartphone shipments also grew faster in emerging markets at 39 percent compared with 20 percent in mature markets.

"In emerging markets, consumer spending typically starts with mobile phones and, in many cases, moves to tablets before PCs," said Megha Saini, research analyst for IDC's Worldwide Smart Connected Device Tracker.

"The pressure on the PC market is significantly increasing and we can see longer replacement cycles coming into effect very soon and that, too, will put downward pressure on PC sales."

IDC also gave its four year outlook, predicting tablet sales to reach over 350 million and portable PCs to hit 240 million.

idc-smart-connected
IDC's four year outlook for 'smart connected devices'.

Topics: Tablets, Apple, Hardware, Laptops, Samsung, Smartphones

Liam Tung

About Liam Tung

Liam Tung is an Australian business technology journalist living a few too many Swedish miles north of Stockholm for his liking. He gained a bachelors degree in economics and arts (cultural studies) at Sydney's Macquarie University, but hacked (without Norse or malicious code for that matter) his way into a career as an enterprise tech, security and telecommunications journalist with ZDNet Australia. These days Liam is a full time freelance technology journalist who writes for several Australian publications, including the Sydney Morning Herald online. He's interested primarily in how information technology impacts the way business and people communicate, trade, and consume.

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39 comments
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  • How does Apple's excessive profit benefit consumers?

    It doesn't. Consumers are best served by the lowest prices that will maintain the company and allow it to create new products. Samsung is the winner hands down.
    AnalogJoystick
    Reply 4 Votes

    • Er......

      Because for some reason, it's regarded as brilliant by the press that Apple make boat load of money out of high margins. Consumers then have less to spend, so sell a kidney or something, and the press applaud how well Apple is doing..........
      Boothy_p
      Reply 3 Votes

      • Good lord!

        Now a company is not allowed to make allot of profit? Would it make you feel better if you got some sort of welfare from them? Or is it just that you want Microsoft, Google or Samsung to rake in the profits?

        Sorry, no one can control the supply chain like Apple can. You folks keep worrying about market share while Apple worries about making money.
        The Danger is Microsoft
        Reply 4 Votes

        • Actually

          They selling kidneys comment was just being funny.
          Couldn't actually care who makes more money, it's the media applause that is just grating.
          The morons who pay loads of cash to Apple then celebrate them and praise them for their revenues, well that sort of things been happening for years. Better than handing over your first born anyway.....
          Boothy_p
          Reply 1 Vote

        • How do you not get it?

          What's good for consumers is the only criteria that consumers should care about. Investors are another story. Investors were very happy with Apple for a while until it became apparent they're going to horde cash forever instead of returning it via dividends to the investors who actually own it, which is why the stock price is down 32% for the last 6 months.
          AnalogJoystick
          Reply 1 Vote

    • So what you are saying is...

      Making a product people are willing to pay for is a bad thing? That price is dictated, not by what people are willing to pay for it, but a communist view of a "standard markup"?
      Bruizer
      Reply 2 Votes

      • So you are actually saying ...

        ... that the more you pay for a product the better it is?

        I've got a used VW I'll sell you for only $100K. Call me. You can then brag about how clever you are.
        radleym
        Reply Vote

        • Sell a few hundred thousand of those used VWs,

          at $100K each, and THEN you will be able to use it as an analogy.
          michaellashinsky@...
          Reply Vote

    • Considering a company has to persuade people

      to part with their money, it is impossible for a company who conducts business legally to have excessive profits.

      What you really mean to say is that Apple makes more profit than you think they should. Which is a totally meaningless statement. Since you are not a participant in buying or selling Apple products, your opinions on their price and profit is irrelevant.
      baggins_z
      Reply 4 Votes

      • Warning sign

        When a company has huge profit margins, it's a warning sign to all doing business with that company. You should very carefully review all agreements with that company and consider if the competition can give you a better deal. If Apple is a Vampire Leech feeding on consumers and other companies, those will with time find other alternatives to being feed on.
        Oden79
        Reply Vote

        • So you see no value in quality?

          Just asking. Simple yes or no.
          Bruizer
          Reply 1 Vote

          • so

            So paying a 43% markup is quality is it?
            Ok..........
            Quality is good, paying over the odds for less is not.
            Boothy_p
            Reply 1 Vote

          • Re: So you see no value in quality?

            That tenuous leap in logic from "large profit margins are a warning sign" to "you see no value in quality" is a clear indication that you are secretly planning a terrorist bomb plot.
            ldo17
            Reply Vote

          • I have tenuous logic.??????

            Please had yourself in to the authorities ASAP.
            For your own and the public's safety.
            Boothy_p
            Reply Vote

      • Bernard Madoff persuaded lots of people

        to part with their money. That's a pretty low bar. Yes it's perfectly legal for Apple to make and horde as much cash as they can. Is it something to be praised and held up as an example of what's good and desirable? No.
        AnalogJoystick
        Reply 1 Vote

    • What Benefits the Fish When Cows Go Hungry

      1) Unless you have a nemesis and are in a closed world of two, one person gaining and one falling back is not a simple win/lose.

      2) Apple, too, is a consumer.

      3) In accordance with free market theory, a transaction occurs when an item of value is exchanged for a desired good or service. If Apple is selling things, we presume that people (consumers as you call them) wanted the item at those conditions and that's the benefit, not the seller's specific price point (which is more controlled by supply and demand then the seller's desire to make precise margins.)

      4) Everyone wants to increase their margin if they can. Some folks lower margin in order to gain volume. High volume / high margin is everyone's Plan A.

      5) AnalogJoystick begs the question that Samsung is carefully choosing its profitability so as to strike the non-existent theoretical max-benefit-to-consumers-point. I think Samsung is spending like crazy on marketing with two goals in mind, to sell the devices that Apple won't and to crush the competition underneath. At this point, win and win. Meanwhile — and how this drives some of us crazy — as Samsung has been winning, Apple has not been losing. Indeed as Samsung is a parts supplier to Apple, it also profits from Apple's profit.

      6) Not everyone buys smartphones and tablets. In fact, at IDC's estimated tablet shipment rate of 200 million, it will take 35 years to sell one to everyone in the world today. If everyone shipped is bought. Hmm. In 35 years, there will be more people. If one has no need for a smartphone, tablet, or computing device — and I'm not sure that demand will be universal or the services usable were it so — it doesn't really matter what the prices are or how much profit any one is making.

      7) If you don't like what Apple sells for the price it sells it as, don't buy it. The rest of us make decision like that every day; we just don't overlay a self-serving patina of "theoretic greater good." Now, if Apple and Samsung put money into the bank because they have devices people want, that's fine. I would not want any one judging me as bad for the consumer if the fruits of my honest labor end up with my having more money in the bank. I don't think AnalogJoystick is arguing that if a worker is cash positive, he or she is being overpaid, meaning a consumer somewhere is being charged too much. Though, looking at it, perhaps AnalogyJoystick is making that exact argument. Though AJ's employers and/or clients might be more interested in that self-negation than us here reading ZDNet.
      DannyO_0x98
      Reply 2 Votes

    • That's just plain crazy!

      AnalogJoystick: "Samsung is the winner hands down."

      A company that makes much less profit compared to its competitor is a "winner"???

      Welcome to Bizzaro World! ;-)
      Harvey Lubin
      Reply 2 Votes

      • Since you struggle with reading comprehension

        I'll explain it to you again. Samsung is the winner hands down.. at putting technology into the hands of the largest number of humans at the lowest cost. They are a better company for consumers. Apple may be a better company for investors. We'll see. Apple stock is taking a beating recently.
        AnalogJoystick
        Reply 1 Vote

      • Dumb!

        A company that makes far less profit than its peers is often bankrupt. The very definition of loser.
        roger that
        Reply 1 Vote

        • Well

          Waiting for Samsung to go Bankrupt.
          Bearing in mind we only talk about Samsung Electronics here, not the whole conglomerate here.
          Not gonna happen, while we're still alive anyway.
          Boothy_p
          Reply Vote
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