Morgan Stanley revises tablet forecast way up, says Windows 8 has big opportunity

June 1, 2012

Tablet shipments in the past two years have actually proved to be 20% higher than Morgan Stanley’s estimate early last year. 

More significantly, the company’s latest “Blue Paper” report to clients on the tablet industry includes a survey of “purchase intentions” that led the firm to update its forecast of tablet shipments much higher. Now the company says it expects 133 million and 216 million tablets will be shipped in 2012 and 2013 respectively –  57% and 122% higher than the original estimates. 

And while the iPad is largely driving the market as the most dominant player, Morgan Stanley says it now believes Microsoft has moved from “a challenged to a best-positioned company in the tablet market.” 

But unlike the hard sales numbers available for iPad and Android tablets, the Microsoft forecast is all conjecture at this point, based on the expected acceptance of Windows 8 tablets due out later this year. Morgan Stanley believes Microsoft’s ace in the hole will be the bundling of Office with Windows 8 tablets. 

“Our survey suggests 25% of users expect to buy Windows 8 tablet and Office is a key feature, especially for those considering their first tablet purchase,” the report says. 

The Blue Paper also notes Android tablets have got a “mixed” reception so far and Microsoft tablets have a chance to grab second place from Android behind the iPad, which currently has 62% of the market. 

Windows 8 tablet pricing will be a major factor

Rumors abound that Google will soon introduce a low cost, 7-inch tablet, likely priced at $199 to compete directly with Amazon’s Kindle Fire. But the Morgan Stanley report indicates Windows 8 tablets will have a tougher time competing directly at the same starting price as the newest iPad of $499. 

The maximum price those responding to the survey said they’d be willing to pay for a Windows 8 tablet with Office included is $469. 


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