As AT&T, Sprint, and Verizon continue extending their LTE networks across the country, a new market analysis suggests that most users will eventually choose not to buy LTE iPads and other 3G/4G-enabled tablets. The report, which comes from research firm CCS Insight, says that demand for iPads and other tablets with built-in mobile broadband support will continue to drop over the next four years. Following that logic, the company says that it expects Apple and other manufacturers to reduce the number of iPads and other tablets with built-in cellular connectivity.
In its forecast, CCS Insight said that it expects that shipments of iPads and tablets with cellular connectivity to drop around half (48%) of devices in 2011 to about one-third (37%) by 2016. The company notes that the majority of users that purchase iPads/tablets with mobile broadband prefer to use Wi-Fi and rarely use 3G/4G data services.
Most users do not regard cellular connectivity in tablets as a must-have, especially given the current price of tablets and mobile data subscriptions.
In the future, the share of cellular-enabled tablets will be determined by three factors: the availability and attractiveness of multi-device tariffs from mobile operators; the availability of public Wi-Fi networks; and the difference between the retail prices of cellular and Wi-Fi-only tablets.
A study by Localytics released earlier this year seems to back up CSS Insight’s perspective. That study showed only 6% of iPad sessions were made over 3G or LTE connections. However, when those numbers were broken down by connectivity capabilities (Wi-Fi only iPads vs. 3G iPads vs. LTE iPad), they showed that users with LTE iPads connected using LTE about one-third (36%) of the time.
The guidance from CSS Insight comes at an interesting time. Verizon and AT&T have launched data sharing plans, but they haven’t been available long enough to make any concerted analysis on how they may impact the market for iPads or other devices in the immediate future or long-term. They certainly have the potential to make LTE iPads more attractive than they were previously and they also drive down the advantages of using a single personal hotspot that shares one connection with multiple devices. Of course, a Verizon LTE iPad can itself be used as such a hotspot.