Growing Popularity of Smartphones and Tablets Leave Special-Purpose Devices Out of Picture

Smartphones and Tablets Cut Demand for Single-Purpose Devices

by Anton Shilov
07/26/2011 | 10:09 PM

Marking a fundamental shift in the history of the consumer electronics industry, the rising sales of multifunction electronics devices like smartphones and media tablets are resulting in a long-term decline in demand for single-task consumer electronics devices, according to the IHS iSuppli.


“The success of multipurpose electronic equipment, often coming at the expense of devices dedicated to a single task, is reshaping the landscape of the consumer electronics industry. In many cases, users can replace a slew of dedicated systems with just one multipurpose device, gaining functionality and portability while simultaneously saving money,” said Jordan Selburn, principal analyst, consumer platforms, for IHS.

Shipments of smartphones and media tablets will rise at compound annual growth rates (CAGRs) of 28.5% and 72.1%, respectively, for the years 2010 to 2015. In contrast, shipments of portable navigation devices (PNDs), portable media players (PMPs) and digital still cameras (DSCs) will either decline or remain flat during the same period of time.

According to IHS iSuppli, shipments of media tablets will rise to 262.1 million units in 2015, up from 17.4 million in 2010. Smartphone shipments will increase to more than 1 billion units in 2015, up from 294.3 million in 2010.

In contrast, global PMP/MP3 shipments are set to fall to 126.8 million units in 2015, declining at a CAGR of negative 6.8% from 180.1 million in 2010, according to IHS, which seems to be a very optimistic prediction for this market. Even Apple, the leading supplier of MP3 players in the world, reports 20% declines in year-over-year iPod sales. Given the dramatic success of powerful smartphones, it is more likely that by the year 2015 PMPs will simply vanish into oblivion on many markets.

For their part, PND shipments will decline to 37.2 million units in 2015, with a CAGR of negative 2.2% from 41.5 million units in 2010. This compares to a booming 88.9% CAGR from 2004 to 2009.

“Media tablets, predominantly the Apple iPad at present, are truly a jack of all trades and master of most. This will put even more pressure on sales of single-task gear. The story of consumer electronics is an ongoing survival of the fittest, and multitasking systems such as media tablets will have a hand in turning yesterday’s hot consumer electronics gear into tomorrow’s fossils,” added Mr. Selburn.

Although not directly acting as replacements for pocket-sized equipment, the media tablet increasingly will play an expanding range of roles for consumers, acting as an e-book reader, music and video player, browser, calendar, alarm clock, gaming platform, PND and camera all in one box.