iPad's biggest competition isn't the Kindle Fire -- it's the iPhone 4S

The iPad's share of the tablet market shrank from 87% in 2010 to 62% in 2011, but after tallying up shipment data from late last year, iSuppli found that, though Amazon's Kindle Fire is the top tablet behind the iPad, it's not what's taking the biggest chunk out of the iOS tablet's market share. Apparently, the iPhone 4S is to blame.

iSuppli's senior manager for tablet research said of their research results:

"Shipments of the iPad line fell short of IHS estimates in the fourth quarter as many loyal Apple customers devoted their dollars to shiny new alternatives. However, the primary alternative wasn’t the Kindle Fire — which debuted to solid sales in the fourth quarter — but Apple’s own iPhone 4S smartphone. The rollout of the iPhone 4S in October generated intense competition for Apple purchasers’ disposable income, doing more to limit iPad shipment growth than competition from the Kindle Fire and other media tablets."

I certainly understand that people only have so much money to spend on gadgets, and they're more likely to upgrade their phone (which is more of a necessity than a toy), and considering the shared software lineage, it's no surprise that people worry about redundant purchases. There are obvious use cases where a tablet is a better pick than a smartphone and vice versa, but unless you have the disposable income for such a fine differentiation, maybe you'd rather a devices that straddle the line, like the Samsung Galaxy Note or the Dell Streak.

Apple CEO Tim Cook recently said that Apple doesn't believe price is a primary consideration for customers, and that people buying cheaper products don't end up with enjoyable experiences. However, if the Kindle Fire has proven anything, it's that for some customers, budget is a big deal.

If you can get a tablet that does the majority of what you want for half the price of an iPad, why wouldn't you consider it? That said, would you be interested in a lower-end, more affordable iPad? Maybe first-gen iPad specs with a smaller screen in the 7-inch range, and a pricetag around $250? Sure, it's not Apple's style, but it would help get folks hooked on two Apple products rather than just one.

Source: iSuppli