NEW YORK (TheStreet) -- After a rough 2014 that saw Apple (APPL) iPad shipments falter for the first time and a general slowdown in tablet purchases, the market is expected to rebound next year with smaller players like Lenovo, Asus and Microsoft (MSFT - Get Report) grabbing additional market share.
While none of these companies are expected to threaten category leaders Apple and Samsung, Jeff Orr, senior practice director for ABI Research believes each made moves in 2014 that will make them more relevant in the coming months and lead shipments of branded tablet to increase 16% to 194 million in 2015.
"Lenovo did acquire Motorola Mobility and this could help it have an impact in the U.S.," Orr said pointing out that Motorola was an early leader in the tablet space and that team is now in place at Lenovo.
Jitesh Ubrani, senior research analyst for IDC's, worldwide tablet tracker noted, "Lenovo has slowly been capturing additional market share over the past year. Given their strength in the adjacent PC and smartphone markets, Lenovo stands a good chance at realizing additional gains in the tablet market."
Much of Lenovo's growth is expected to take place outside of the U.S. in countries where the company has already established itself and it should do well in countries like Brazil where tablet sales are just starting to grow, but inside the U.S. it may find the going a bit tougher.
"It's difficult to change consumer's attitudes toward the [Lenovo] brand as it's considered by many to be a business computer provider," Orr said, adding that this could prove to be a positive for Lenovo as tablets are gaining acceptance as business tools. Lenovo's consumer-targeted tablets sell the IdeaTab, ThinkPad and Yoga tablets.
Microsoft may have been the surprise player in the 2014 tablet market breaking the 5% market share barrier for the first time in the third quarter with its Surface models and Orr expects its fourth quarter sales to also show improvement year over year. However, gaining this share is coming at a very high cost to the company.
"Microsoft's investment is still disproportionate to their return. I think the awareness is building, but not the sales," he said.
Another factor that will impact Microsoft's year is the industry reaction to the release Windows 10, said the research firm IDC in a recent report. The new operating system is expected to launch around the middle of the year after Microsoft's Build conference.
Asus and Acer also will be on the move in 2015 possibly taking some share from Amazon (AMZN - Get Report) . ABI believes that Amazon may have topped out its market penetration with the Fire tablet in 2014, with the brand having a finite audience leaving new tablet shoppers to look at the Taiwanese firms for an inexpensive tablet.
Asus makes the MeMo Pad and Transformer Pad tablets and Acer is in the market with its Iconia line.
Apple is not likely to lose any sleep over their position in the tablet market. Apple is expected to rebound in 2015 after experiencing its first fall off in iPad sales in 2014. Even though fourth quarter numbers not yet finalized Orr is forecasting iPad shipments to hit about 68 million down from 74 million in 2013. IDC is a bite more bearish expecting almost 65 million units to ship this year, but growing to just over 70.1 million by 2018.
"Stagnation in the iPad's design, interface, and features combined with the exceptional longevity of the previous generations will lead to a decrease in market share in the coming years. That said, it's important to note that iPads command a premium price. So in terms of dollars, Apple will likely remain far ahead of its competition, Ubrani said.
Samsung and its Galaxy Tab tablets enjoyed a good year with shipments increase by 5 million units to 43 million and this growth is expected to continue in 2015. However, Orr believes Samsung is a bit more vulnerable to its competitors and must make a few moves to fend them off.
"Samsung has to prune back its offerings in the U.S. Whenever it sees a spot in the market it pumps out new products to fill that specific niche and this can cause an overload situation," he said.
Overall, the tablet market did grow in 2014. Albeit at a slower rate than earlier years with IDC seeing 7.2% growth on 235.7 million units shipped. IDC includes two-in-one tablet PCs in their shipment figures.
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