Why Apple introducing a 12.9-inch iPad could affect the market (Part 7 of 7)

(Continued from Part 6)

Apple could launch a bigger iPhone and a bigger iPad

Apple (AAPL) is expected to take a number of new product initiatives in the coming months. It’s expected to launch a bigger iPhone 6 next month. The demand for phablets, or larger-screen smartphones, is so high that Apple would do better to launch them sooner than later. Phablets are the fastest-growing category in the overall smartphone category. Success in this space would benefit Apple and increase its overall market share.

According to a report from Bloomberg, Apple could launch a bigger iPad next year. It will be a 12.9-inch tablet. The main possible reason why Apple would launch such a device is the fear of cannibalizing its own iPad sales from the bigger iPhone. Apple is already struggling in the tablet market, and such a device could help revive iPad sales in the consumer as well as enterprise segments. Apple recently partnered with IBM (IBM), keeping enterprise customers in mind. A higher difference in iPad and iPhone screen sizes would also help users serve different purposes and feel a need to buy both devices.

Android continues to dominate the smartphone operating system market

According to a report from Strategy Analytics and as the chart above shows, Google’s (GOOGL) Android continues to dominate the smartphone operating system market. Its share of global smartphone operating system has increased from 80% in 2Q13 to about 85% in 2Q14, while Apple’s has declined from 13.4% to 11.9% during the same period. Microsoft’s (MSFT) and BlackBerry’s (BBRY) shares also continue to decline.

The launch of a bigger-screen iPhone and iPad could definitely help increase Apple’s share in these markets. More importantly, it would boost Apple’s ecosystem, which helps create a halo effect. This means that users buying one Apple device tend to buy other Apple devices as well.