Phablets—aka Pocket Computers—Drive New World Order

on August 25, 2014

I’m writing this week’s column from the comfort of my hotel room in Shenzhen, China where I just witnessed first hand the evolutionary wave that has begun to take over the world of smart connected devices — phablets are king. Everywhere I turned in one of the many buildings stuffed full of electronics products and components for which this very large (~10.5 million) and surprisingly affluent[1] city is famous, I found more evidence.

It wasn’t just the large screen dominated selection of legitimate and knock off phones offered by hundreds of different small vendors, it was also the comparative scarcity of tablets—especially the 7” varieties which this region is famous for producing. Don’t get me wrong, they were still there—as well as lots of tablet component parts—but nowhere near the level of mobile phones. In fact, in my tours of several buildings, I’d put it even lower than the amount of PCs and related components.

The final form of evidence came in the form of the iPhone 6, which is poised to bring a whole new level of legitimacy and interest in the large screen smartphone market. As I expected, I saw a whole range of vendors offering iPhone 6 cases for sale—theoretically sized to match up with the leaked specs for the device.

But what caught me off guard were all the vendors actually offering iPhone 6 phones—or at least what they claimed were iPhone 6s. Having done a bit more digging, I’m now pretty convinced they were Goophone’s i6 knockoffs. Still, when one booth worker pulled a roughly 4.7” screen-based device out from behind their glass case and turned it on and I watched what certainly looked like iOS booting up, I have to admit I started to wonder. (Unfortunately, I only got to look at it for a few seconds, but I did notice an OS version of 7.1.4 on the About screen, which suggests a jailbroken version of the OS.)[pullquote]What caught me off guard in Shenzhen were all the vendors offering iPhone 6 phones—or at least what they claimed were iPhone 6s, several weeks before its introduction.”[/pullquote]

Regardless of the device’s authenticity (and again—very unlikely to be the real McCoy), seeing an Apple-looking device of that size (as well as even larger), lined up against the other large screen smartphone competitors reinforced the fact a large screen iPhone is likely to be a monstrous hit for Apple here in China and probably in many other places around the world.

Tie that together with the research I wrote about a few weeks ago (see ”Hot Items for the Holidays: Large Phones, Notebooks and Smart TVs”) which clearly showed strong pent up demand for larger smartphones among consumers around the world and, well, you don’t have a guarantee, but it sure makes the odds increase.

On top of that, we’ve got reported numbers of increasing PC sales and flat to declining tablets sales through the first half of the year and several supply chain-related news tidbits suggesting those trends should last at least through the end of the calendar year.

The end result? I think it will lead to some fairly dramatic shifts in the devices markets as we have known them. I’ll talk more about this next week when I unveil the updated TECHnalysis Research forecasts on PCs, tablets and smartphones, but the gist of it is pretty easy to guess: big smartphones will move the balance of power to themselves and away from smaller smartphones and smaller tablets. In the process, they’ll actually end up helping boost the PC market, as both consumers and enterprise buyers start to recognize the potential synergies of combining a large smartphone and a touch-equipped, but clamshell-focused notebook.

Looks to me like we’re in for some important changes over the next few years….


[1] I spotted two Rolls Royces in 30 minutes, not to mention Porsches, Jaguars and Maseratis, as well as lots of Audis, Mercedes and BMWs….