Low-Cost Tablet Growth: Should Apple Inc. (AAPL) Be Concerned?

Let’s face it: Apple Inc. (NASDAQ:AAPL) has never been confused for being the cheapest option. This holds true across all of the company’s products, ranging from its iPad to the iPhone among others.

Does this mean Apple needs to lower its prices in order to better compete in the future? Of course not. That being said, there are competitors that realize this is the only way they are ever going to make a dent. For this reason, they are looking at how cheaply they can push products to the market. This may not be the only way to beat Apple Inc. (NASDAQ:AAPL), but it appears to be the strategy that many are relying on.

International Data Corporation (IDC) recently took a closer look at this in the following report: Low cost tablets take the India market by storm, significantly altering the dynamics in CY 2012

This study only takes a look at the tablet market in India, but it goes a long way in showing where low cost devices fit in and how Apple, among other companies, could be impacted in the future.

Here is an excerpt from the study:

“According to IDC’s Worldwide Quarterly Tablet Tracker data for CY 2012, the overall Tablet market in India has reached approximately 2.66 million units, a whopping 901% Y-o-Y growth from CY 2011. The Tablet market exploded from a fledgling niche category into a thriving and intensely competitive market within a span of 12 months, with cheaper and smaller screen-size form factors leading the charge since 2nd half of 2012. “

As you can see, the tablet market in India is no longer small potatoes. For this reason, we can expect Apple Inc. (NASDAQ:AAPL) to pay more attention in the future.

Here is some more from the study:

“The low cost 7 inch tablets made up for close to 78% in the total volume shipments for Q4 2012, the growing contribution of local vendors and the increasing Chinese imports in the Indian market can be attributed as the primary reasons for this trend.”

With all this talk about low cost tablets, the same report does mention that Apple Inc. (NASDAQ:AAPL) and Samsung are doing their part, along with cheaper alternatives, in pushing the market forward.

As the tablet market in India continues to grow, it will be interesting to see if Apple Inc. (NASDAQ:AAPL) is able to hold onto a large piece of the pie or if low cost alternatives take over.

For more from this study, check out the graph on the following page: