updated 12:35 pm EST, Mon January 31, 2011
Samsung admits Galaxy Tab sales poorer than claims
Samsung during the call for its fall quarter results admitted that its actual sales of the Galaxy Tab weren't nearly as strong as claimed. Although it had said it sold 1.5 million Galaxy Tabs in 2010 and two million by this month, company official Lee Young-hee when pressed said that these were only sales to carriers and retail stores, not real customers. She wouldn't say how many had shipped but was aware that it was "quite small" relative to the number reaching stores.
The sales performance was "quite OK," Lee said, but also "wasn't as fast as we expected." She was hopeful for 2011 tablet sales but saw the category as too fresh to make predictions.
Samsung's disclosure could significantly alter the real market share for Android tablets, which Strategy Analytics said had jumped to 22 percent in the fall owed almost entirely to the Galaxy Tab. Apple when it reports iPad shipments also isn't talking sales but can assume that the majority of shipments are being sold and has usually just three to four weeks of inventory left at most.
No attempt was made during the call to explain the relatively poor uptake. Critics have usually cited the lack of a Wi-Fi-only model that wasn't made available until this year and Samsung's frequent reliance on carrier-discounted 3G versions. While it superficially lowered the price of the Galaxy Tab below that of the iPad it was designed to beat, the frequent requirement for a contract at that price would often leave a buyer spending hundreds of dollars more in service, even if they only needed 3G sporadically. In the US, a Galaxy Tab is only $30 less than a 3G iPad when bought off-contract despite the smaller screen and shorter battery life.
The device's nature as a stopgap tablet may also have played a part. Many fans were already aware that Google's true tablet OS, Android 3.0, was due early this year. Such knowledge could have left many waiting for the next-generation Galaxy Tab to avoid buying a short-lived product. Since the current model doesn't have the 720p screen or dual-core processor that has been a staple of Android 3.0 tablets shown so far, it could be left running at best Android 2.3 and more likely 2.2.
Only one other major mobile platform maker has used a similar strategy in recent months. Microsoft has so far refused to discuss real Windows Phone 7 sales for the fall in favor of talking only about sales to carriers. It's commonly thought to be using a similar strategy to Samsung, where declining to mention the number of real activations helps mask significantly lower demand from customers. [via WSJ]