AT&T leads the (still small) cellular tablet market with 49% share

According to new data from research firm NPD Group, AT&T Mobility (NYSE:T) serviced almost half of all the tablets in the nation that connected to cellular networks in the first quarter. However, the percentage of tablets that actually do connect to 3G or 4G networks is relatively small--NPD found that only 12 percent of all tablets in the United States connect to cellular networks.

"Most consumers haven't found that key application convincing them to add a cellular connection," said Eddie Hold, vice president of NPD's Connected Intelligence division, which released the new research. "Another set-back is that many tablets purchased today do not include a cellular modem, which further limits the directly-addressable market for mobile operators. Instead, these operators need to focus on tethering and mobile hotspot solutions in order to grow the market more rapidly."

According to NPD, AT&T serviced 49 percent of all tablets that connected to cellular networks in the first quarter. Verizon Wireless (NYSE:VZ) came in second place with 42 percent. Sprint Nextel (NYSE:S) and T-Mobile US (NYSE:TMUS) followed with just 7 percent and 1 percent, respectively.

As Hold pointed out, AT&T and Verizon are the largest carriers in the United States and both sell the cellular-capable Apple iPad. Further, both carriers offer shared-data plans intended to spur the sales of tablets; such plans allow customers to draw from the same bucket of data via a variety of devices, including smartphones and tablets. 

AT&T's lead in the tablet market is likely due to the fact the carrier was the first to support Apple's iPhone and iPad devices. Verizon Wireless added cellular connectivity to the iPad when Apple released the iPad 2 in 2011.

Although NPD found that only 12 percent of all tablets in the United States connect to cellular networks, the firm said that figured increased by 48 percent over the first quarter of 2012.

In other NPD findings, the firm said that tablet users consume an average of 850 MB of cellular data per month, which the firm said is lower than the average monthly consumption among smartphone users (1 GB). NPD said that the average amount of Wi-Fi data usage per month was 10 GB, mainly due to video consumption.

Source: NPD

Tablets continue to represent a potentially significant opportunity for wireless carriers. Cellular-capable tablets will generate a total of $20 billion for wireless operators in 2017, according to recent research firm Strategy Analytics, due in large part to operators' efforts to encourage subscribers to activate LTE connections on tablets through shared data plans.

For more:
- see this NPD release

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