IC Insights believes strong sales of large-screen smartphones will continue in the next three years while the tablet market struggles with low single-digit percentage growth through 2018. The revised forecast shows large-screen smartphone shipments climbing by a compound annual growth rate (CAGR) of 40% between 2014 and 2018, while tablet unit shipments are expected to rise by a CAGR of just 3% in this four-year period. Large-screen smartphones are having the biggest impact on mini tablets, which saw a rise in popularity in the past few years. Mini tablets have 7- to 8.9-inch displays and typically run the same software as smartphones.
Tablet unit sales have nearly stalled out because incremental improvements in new models have not been enough to convince owners of existing systems to buy replacements. More consumers are opting to buy new large-screen phablets instead using both a smartphone and tablet. Large smartphones have gained traction because more handsets are being used for video applications (including streaming of TV programs and movies) in addition to Internet web browsing, video gaming, GPS navigation, and looking at digital photos.
Boldfaced emphasis added by me.
This is no surprise. What will probably boost tablet sales are people choosing a tablet instead of a replacement desktop PC — unless, you know, they go for a notebook or Chromebook. Keyboard.