Is Apple Ready for Walmart Attack in Weak Tablet Market?


Aug. 1 2019, Updated 8:02 p.m. ET

Walmart planning to launch a cheap tablet device

Walmart (WMT) has a target on Apple (AAPL) this year. The retail giant is planning to introduce a cheap tablet device under its ONN store brand at any moment, according to a report from Bloomberg. Walmart’s upcoming tablet product will run Google’s (GOOGL) Android software and compete with Apple’s iPad tablet line.

While Apple generally targets the high end of the market with its range of devices, prolonged weakness in the tablet market has prompted the company to try to woo customers with low-cost iPads. As the Verge reported, Apple last year introduced a new iPad that started at $300. Therefore, a more competitively priced tablet device from Walmart would heap more pressure on Apple to defend its tablet market share.

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Walmart wading into market dominated by Apple

Walmart is plotting an attack on Apple in the tablet market at a time when the market has been on a decline. According to Strategy Analytics estimates, global tablet shipments declined 6.0% in 2018 from the previous year. But even with a cheap tablet device, Walmart will be wading into a territory dominated by Apple. Apple captured 26.8% of the global tablet market in 2018, while rival Samsung (SSNLF) had 13.3%, and Amazon (AMZN) had 6.9%.

Apple generated $6.7 billion in revenue from its iPad business in the first quarter of fiscal 2018, the period ended in December. In addition to the direct revenue from device sales, Apple also relies on a wider adoption of its devices such as the iPad and iPhone to enlarge its services market. Apple aims to double the amount of services revenue it generated in 2016 by 2020.


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