Shipments of the Kindle Fire went cold in the first quarter, falling 62% to 0.8 million units from 4.8 million in the fourth quarter, according to new data from IDC. That dropped Amazon from a 16.8% share of the worldwide tablet market to just a 4% share, with Samsung jumping ahead to second place behind Apple.
The Kindle Fire’s flame-out reflected a broader decline in demand for Android-based tablets, leading to a larger-than-expected drop in tablet shipments during the quarter. Total tablet shipments reached 17.4 million units, 1.2 million below IDC’s projection.
On a year-over-year basis, growth in the tablet market remained robust, with shipments up 120% from 7.9 million a year ago. Continued strong iPad sales helped offset the steep falloff in Android tablets. Shipments of the Apple tablet fell to 11.8 million from 15 million in the previous quarter, but were roughly on par with analyst expectations.
Apple’s relatively steady performance helped it extend its hegemony in the tablet market from a 54.7% share of shipments in the fourth quarter to 68% in the first quarter. "Apple reasserted its dominance in the market this quarter, driving huge shipment totals at a time when all but a few Android vendors saw their numbers drop precipitously after posting big gains during the holiday buying season,” said Tom Mainelli, research, Mobile Connected Devices, IDC.
What happened to the Kindle Fire, which surged into second place behind the iPad after a strong holiday season launch? Priced at $199, the Amazon tablet became a favorite impulse-buy holiday gift, explains Bob O’Donnell, program vice president, clients and displays, at IDC. “The initial cycle of buzz around the Kindle Fire was really strong in Q4, and then that went away,” he said.
Acknowledging the first-quarter slump raises questions about the Kindle Fire’s long-term viability, O’Donnell cautioned that it’s too early to write it off as another iPad casualty.
IDC also said it expects Amazon to come out with a larger-screen device, as rumored, to compete more directly with the iPad. At the same time, Amazon will face heightened competition when Google enters the tablet market with an inexpensive, co-branded ASUS tablet designed to challenge the Kindle Fire.
Like the Amazon tablet, Barnes & Noble’s Nook Tablet, launched in the fourth quarter, was also believed to take a hit in the first quarter. While IDC didn’t provide specific numbers for the device, O’Donnell said shipments of the Android-powered Nook Tablet fell significantly quarter-over-quarter, but not as much on a percentage basis as the Kindle Fire.
With the release of its well-received Nook Simple Touch with GlowLight model last week, allowing users to read in the dark, Barnes & Noble could be poised for a second-quarter rebound. The bookseller also kicked off a new ad campaign for the device directly taking a swipe at Amazon, which doesn’t yet offer a similarly illuminated e-reader. Among the taglines featured in new print ads: “Sorry Kindle, you’re just not that good in bed.”
When it comes to the tablet market, Barnes & Noble ranked fifth behind Apple, Samsung, Amazon, and Lenovo, according to IDC. Still looming on the horizon is Microsoft’s Windows 8 tablet, widely expected to ship in the fourth quarter.
O’Donnell suggested it was to soon to gauge the impact of a Windows 8 tablet, but that the tablet market would likely see another shakeup in the second half of the year as new devices roll out. "While Apple will continue to sit comfortably on the top for now, the battle for the next several positions is going to be fierce,” he said.