Apple-IBM Deal is expanding-Will it boost slowing iPad sales?

Apple and IBM entered into a partnership last year and announced first wave of Mobile first iOS solutions by IBM during december 2014 where they launched ten enterprise specific apps  in verticals like banking, retail, insurance, financial services, telecommunications and for governments and airlines in Travel Industry including clients like Citi, Air Canada, Sprint and Banorte.The announcement also included the plans of Apple and IBM to increase the number of apps to 100 by end of 2015 across several verticals and to carry forward the existing partnership three new apps were announced  at Mobile world congress 2015 including Passenger Care (for airline customer service agents), Advisor Alerts (financial professionals) & Dynamic Buy (providing real-time data to retailers on product performance).But the key question remains whether it will boost slowing iPad sales?

Apple IBM Deal Expansion

During the end of 2014 we have seen  the worldwide tablet market showing slow growth contrary to what was estimated couple of years ago. Moreover the sales of Apple’s iPad has shown negative annual  growth rate as summarized in the chart below.




Although Apple’s iPad shipments and sales have been waning over the last year or so, iPads traction and growth in consumer segment is almost dipping off with the rise of phablets (especially iPhone 6 Plus now) and longer replacement cycles of tablets. Below are some of key observations which can be considered to arrive if we can see increase in iPad sales post the IBM deal.

Its more than just distribution: Apple-IBM deal is about Apple partnering with IBM to not only be a distributor or reseller of Apple hardware but also co-develop enterprise-grade software and services highly optimized for iOS platform. IBM will thus focus on making iOS devices enterprise-grade by reverse engineering what iOS doesn’t have (and has never had) out of the box; for example security, device management etc. iOS was primarily a consumer operating system so it doesn’t have many of the things that enterprise CIOs typically require.

Leveraging IBM’s deep experience in Enterprise: IBM will prioritize Apple offerings above others when promoting its software & services as the de-facto standard. Apple thus being able to leverage IBM’s greater penetration in enterprise segment.

Use cases in Different Verticals: We believe that Banking, Financial services and Insurance (BFSI), Travel, Manufacturing and Retail will lead as far as vertical specific apps are concerned. As per Apple they have planned 100 enterprise specific apps by the end of the year. Going forward the demand will be more among the organizations which are buying tablets as a solution rather than a device. And lot of use cases for tablets are still not explored along with improving and redefining the user experience of existing set of apps in various verticals.


But then couple of factors as mentioned under can act as inhibitors:


Competition: However, at the same time it remains to be seen what Microsoft does in terms of improving the overall user-experience of the platform with Windows 10 upgrade which might challenge iOS to some extent as well. Also players such as Google & Samsung have over the past two years spending millions of dollars to elevate and push Android and Galaxy offerings to commercial grade-level respectively in the enterprise (e.g. with KNOX effort) and have gained some traction in some enterprises.

Apple’s Product mix : Apple’s product mix is still significantly skewed towards iPad mini form-factor (mostly consumer and almost 55-60% of the total shipments).Hence, Apple would need a bigger form-factor and enterprise grade software, features and management support (like Surface) to stimulate iPads in enterprise in a bigger way.

Already higher BYOD trend: Enterprise sales channel is still not a huge contributor to the overall sales for iPads and BYOD trend for iPads is already higher in some verticals like Education, Healthcare, and Hospitality etc.

Hence considering both set of assumptions above I believe Apple-IBM partnership is still in a very early stage to have made much difference and any uplift so far would be lost in the noise around its blockbuster last quarter. However going forward there may be a modest uplift over time as the app numbers increase across various verticals and touch its target of 100 by end of 2015 but the real uplift can be seen if and when Apple launches its bigger screen tablet.


Below is a chart based on our observation of adoption/penetration/momentum of computing devices (platforms) in various verticals prior to IBM deal and we will keep on monitoring how this distribution changes over the next year or so.

Vertical Windows Android/Chrome iOS/Mac
Banking, Financial services and Insurance (BFSI) HIGH LOW MEDIUM
Manufacturing and Retail MEDIUM HIGH LOW
Source: Counterpoint Research

If you would like to learn different strategies of these companies, market analysis and in-depth research on digital & mobile ecosystems or if you have any follow-up questions or comments on the above post. Please feel free to reach out to us

Tarun is a Research Director with Counterpoint Technology Market Research, based out of Gurgaon (near New Delhi). Tarun has 10 years of work experience with a key focus on the evolving mobile device ecosystem with specialties in Emerging Markets. He understands specific mobile industry nuances, helping clients to navigate through the rapidly changing technological trends. As a Telecom Analyst he has been quoted extensively by the leading media platforms. Tarun holds a Post Graduate Diploma in Management, specializing in International Business from the Amity International Business School and is a graduate in Physical Sciences from Jammu University, Jammu in the northern Indian state of Jammu & Kashmir.

Term of Use and Privacy Policy

Counterpoint Technology Market Research Limited


In order to access Counterpoint Technology Market Research Limited (Company or We hereafter) Web sites, you may be asked to complete a registration form. You are required to provide contact information which is used to enhance the user experience and determine whether you are a paid subscriber or not.
Personal Information When you register on we ask you for personal information. We use this information to provide you with the best advice and highest-quality service as well as with offers that we think are relevant to you. We may also contact you regarding a Web site problem or other customer service-related issues. We do not sell, share or rent personal information about you collected on Company Web sites.

How to unsubscribe and Termination

You may request to terminate your account or unsubscribe to any email subscriptions or mailing lists at any time. In accessing and using this Website, User agrees to comply with all applicable laws and agrees not to take any action that would compromise the security or viability of this Website. The Company may terminate User’s access to this Website at any time for any reason. The terms hereunder regarding Accuracy of Information and Third Party Rights shall survive termination.

Website Content and Copyright

This Website is the property of Counterpoint and is protected by international copyright law and conventions. We grant users the right to access and use the Website, so long as such use is for internal information purposes, and User does not alter, copy, disseminate, redistribute or republish any content or feature of this Website. User acknowledges that access to and use of this Website is subject to these TERMS OF USE and any expanded access or use must be approved in writing by the Company.
– Passwords are for user’s individual use
– Passwords may not be shared with others
– Users may not store documents in shared folders.
– Users may not redistribute documents to non-users unless otherwise stated in their contract terms.

Changes or Updates to the Website

The Company reserves the right to change, update or discontinue any aspect of this Website at any time without notice. Your continued use of the Website after any such change constitutes your agreement to these TERMS OF USE, as modified.
Accuracy of Information: While the information contained on this Website has been obtained from sources believed to be reliable, We disclaims all warranties as to the accuracy, completeness or adequacy of such information. User assumes sole responsibility for the use it makes of this Website to achieve his/her intended results.

Third Party Links: This Website may contain links to other third party websites, which are provided as additional resources for the convenience of Users. We do not endorse, sponsor or accept any responsibility for these third party websites, User agrees to direct any concerns relating to these third party websites to the relevant website administrator.

Cookies and Tracking

We may monitor how you use our Web sites. It is used solely for purposes of enabling us to provide you with a personalized Web site experience.
This data may also be used in the aggregate, to identify appropriate product offerings and subscription plans.
Cookies may be set in order to identify you and determine your access privileges. Cookies are simply identifiers. You have the ability to delete cookie files from your hard disk drive.