Lenovo CEO: Tablets Make Up Niche Market

January 11, 2012, 12:25 AM EST By Douglas MacMillan

Jan. 11 (Bloomberg) -- Lenovo Group Ltd. Chief Executive Officer Yang Yuanqing said there’s scant room for growth in the tablet market, and that devices running Google Inc. software -- including his company’s machines -- will keep trailing the iPad.

“Tablets will not replace the traditional” personal computer, Yang said in an interview yesterday at the Consumer Electronics Show in Las Vegas. “The traditional PC is changing to adapt to the customer requirements. The tablet is an extra market for some niche customers.”

While Lenovo makes tablets, it’s also an early entrant into the market for so-called ultrabooks, a term coined by Intel Corp. to describe light, thin laptops. A year after tablets dominated much of the talk at CES, computer makers used press briefings and erected elaborate booths to focus showgoers’ attention on the newer category of slim PCs.

“This will become a trend to replace part of the notebook market,” Yang said of ultrabooks.

Ultrabooks will account for more than 40 percent of all notebooks by 2015, researcher IHS said in November. Lenovo’s Yang said he expects the category to make up 30 percent to 40 percent of notebooks in the next 18 months.

Apple’s iPad controls more than 65 percent of the worldwide market for tablets, according to Framingham, Massachusetts-based researcher IDC. Google’s Android tablets, including Lenovo’s IdeaPad A1, represent 32 percent of all tablet sales.

“Apple is the leader,” Yang said. “For the Android ecosystem, we still need to learn something, we still need to improve something.”

Lenovo on Jan. 9 touted a hybrid device called the IdeaPad YOGA, a laptop that uses a swiveling screen to function both as a touch-screen tablet and as a more full-featured ultrabook. Products like this, which combine features of smartphones and PCs, will win out over tablets in the long run, Yang said.

--With assistance from Rich Jaroslovsky and Ian King in San Francisco. Editors: Tom Giles, Frank Longid

To contact the reporter on this story: Douglas Macmillan in New York at dmacmillan3@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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