More evidence that the big phone is the new small tablet

by tech on July 11, 2014

Earlier this week, tucked into commentary in a fairly dismal earnings preview, Samsung said that “the demand for 5- to 6-inch smartphones cannibalized the demand for 7- to 8-inch tablets.” Samsung sells a lot of 5- to 6-inch smartphones, and fewer 7- to 8-inch tablets. So is this a lame excuse for what looks to be a down quarter for the Korean conglomerate, or is it a leading indicator that the small tablet market might be in trouble?

According to a report published earlier this week by research firm NPD Display Search, yes, 7- to 8-inch tablets are losing out to handsets. In 2013, smaller tablets made up 58 percent of the market. They’re cheaper, and for a lot of people, they strike the right balance between weight and screen size. But the report noted that small tablet share will likely decline in the future, due to competition from 5.5-inch and larger smartphones. Taking up the relinquished market share should be tablets between 8 and 11 inches, which the report estimates will be more common in 2018. Big tablet and PC hybrids like the Surface Pro 3 will also have a small chunk of the market by 2018.

Samsung's Galaxy W, a 7-inch smartphone

Samsung’s Galaxy W, a 7-inch smartphone

It seems as if Samsung has finally figured out what observers have been predicting for years: bigger smartphones offer a tablet-like experience with the benefits of cellular voice capabilities. I predict phones will continue to grow in size — once manufacturers and consumers give up on pocketability, there’s really no limit to how big phones can get. There are already 7-inch devices for sale in markets like Korea. And as more smartphones are sold to first-time customers in emerging markets, those devices will be their owners’ first and most likely only computers. They’ll want a big screen for watching video, plus cellular connectivity for keeping in touch.

Related research and analysis from Gigaom Research:
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