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Phablets are not a phad

Media release

16 January 2014

Phablets are not a phad

This year will see phablets — an oversized smartphone that’s part cell phone, part tablet — outsell tablets by $25 billon USD according to the 13th edition of Deloitte’s Technology, Media and Telecommunications (TMT) Predictions report released this week.

According to Deloitte New Zealand partner Darren Johnson, the annual global predictions report says that shipments of phablets, smartphones with 5.0-6.9 inch screens, will represent a quarter of smartphones sold, or 300 million units, in 2014.

“That is double the 2013 volume, and 10 times 2012 sales,” says Mr Johnson.

“But after initial rapid consumer success, 2014 may mark a ‘peak phablet’ year, as only a particular type of smartphone user will want to handle such a large device.”

Continuing on this theme, the report predicts the installed base of compact tablets (with screens smaller than 9 inches) will surpass the base of classic tablets (9 inches and larger) for the first time.

“By end the first Quarter, we expect the base of compact tablets to be 165 million units, slightly ahead of the classic tablet base, with 160 million,” says Mr Johnson.

“In addition, we expect the total global sales of smartphones, tablets, PCs, TV sets, and gaming consoles – what we call the ‘converged living room’ – will exceed $750 billion USD in 2014 and then plateau as consumer usage will continue to converge.”

This year’s 14 TMT predictions cover a range of other topics, from wearable technologies selling 10 million units, the global value of premium sports video rights increasing 14 percent, 50 million homes around the world doubling up on pay-television, and an upsurge in medical eVisits, to name a few.

“While some of the trends covered in this year’s predictions may not seem immediately relevant to the New Zealand market, global connectivity and the speed of technological change will surely make them relevant here in the near future making it a case of ‘when’ not ‘if’,” concludes Mr Johnson.

Highlights of this year’s TMT predictions to impact the marketplace in 2014 include:

•          Wearables: the eyes have it – Smart glasses, fitness bands and watches, should sell about 10 million units in 2014, generating $3 billion USD. Of these wearable computer form factors, smart glasses should generate the most revenues, from sales of about four million units at an average selling price (ASP) of $500 USD. Smart fitness bands should sell four million units, at an ASP of $140 USD; smart watches should sell about two million units at an ASP of $200 USD.
•          eVisits: the 21st century housecall – There will be 100 million eVisits globally, potentially saving over $5 billion USD when compared to the cost of in-person doctor visits  and representing growth of 400 percent from 2012 levels.
•          Doubling up on pay-TV – By the end 2014 up to 50 million homes around the world will have two or more separate pay-television subscriptions, with the additional subscriptions generating about $5 billion USD in revenues. A further 10 million homes will receive premium programming as part of their subscription to another service, such as broadband.
•          Broadcast sports rights: premium plus – The value of premium sports broadcast rights will increase to $24.2 billion USD, a 14 percent rise on 2013, equivalent to an additional $2.9 billion USD. This increase in rights fees will be driven by new agreements with certain top tier European domestic football (soccer) leagues and major North American sports leagues.
•          The smartphone generation gap: Over 55? There’s no app for that – Over-55s will be the age group experiencing the fastest year-on-year rises in smartphone penetration across developed markets. Ownership should rise to between 45 to 50 percent by year-end, lower than the approximately 70 percent penetration rate for 18-54 year olds, but a 25 percent increase from 2013. 
•          Short messaging services versus instant messaging: value versus volume –   Instant messaging services on mobile phones (MIM) will carry more than twice the volume (50 billion versus 21 billion per day) of messages sent via a short messaging service (SMS).

Full details about the global TMT Predictions are available at


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