DELL INC.

Dell exits Android tablet business, says market is oversaturated

Posted July 6th, 2016

Story highlights
  • Dell Inc. pulling out of the Android tablet business
  • Tech giant says "detachable" tablets make better business sense

Dell Inc. is saying goodbye to its Android tablet business.

"The slate tablet market is oversaturated and experiencing declining demand from consumers, so we've decided to discontinue the Android-based Venue tablet line," the Round Rock-based tech giant said in a written statement. The device was introduced in 2013. 

The decision isn't surprising to many in the industry. Tablets are going through a major sales slump.  

These handheld devices are primarily being used for at-home personal entertainment, and not business travel. There aren't enough technological advances in the newer version of tablets to make customers want to upgrade, and they don't solve a pressing need that can't be accomplished with a personal computer or smartphone.

As a result, worldwide tablet shipments are expected to decline in 2016 by 9.6 percent, according to research firm International Data Corporation. This is the second straight year tablet shipments have declined and there is no resurgence on the horizon.

The one growth area in tablets are "detachables" which are tablets that come with removable keyboards. Industry research firm IDC is forecasting that detachable tablets will become reach 31 percent of the tablet market by  2020.  Standalone tablets, such as the iPad, are often called slate tablets. 

Since the iPad was unveiled in 2010, "we've seen the tablet market reach a kind of flood-level tide and it has been receding ever since," said industry analyst Roger Kay. 

He said detachable tablets are the right focus for Dell because they offer higher profit margins and the "highest growth markets among their PC clients." 

Kay noted that this is not the first time Dell has tried an Android product, only to abandon it. 

Earlier this decade the company released an Android-powered phone, only to pull back after the consumer enthusiasm wasn't there. Kay said it's a good thing Dell is willing to try new things and then reverse course.

Kirk Schell, Dell's vice president and general manager of commercial client solutions, said in a lengthy blog post on the company's website that detachable laptops are the right focus for Dell.  

"While there will always be a need for niche devices and certain features for computing tasks, we've found that the lack of productivity delivered by slate tablets are forcing people to leave them at home, and instead continue to use PCs to get the real world done," Schell wrote.

Detachable tablets have become the preferred tablet device for the workplace "which is why we're continuing to invest in the space, while beginning to divest from the slate tablet market, Schell wrote.

Dell said it will continue to support any currently active warranties and service contracts for its Android tablets until they expire. The company is still selling its Window-supported Venue Pro slate tablets

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