HTC has canceled plans to develop a larger Windows RT tablet because demand for tablets based on the Microsoft operating system has been weak, unnamed sources told Bloomberg.
HTC will still release a ARM-based 7-in. Windows RT tablet in the fall, but not the larger one that was expected to sport a 12-in. display, the sources told the business website. The larger device requires more expensive components, which would have led to a higher retail price, the sources said.
HTC and Microsoft could not be reached to comment on the report.
Another Windows RT tablet maker, Dell, decided in mid-May to drop the price of its Dell XPS 10 tablet running Windows RT by $200, down to $300. A spokeswoman, however, said at that time that the company expects Windows RT to grow stronger over time.
HTC has reason to be wary about which products to bring to market as its sales have dropped and market share has declined, analysts said.
The trend in the tablet market is decidedly in favor of sub-8-in. tablets and also away from Windows RT but in favor of Windows 8, according to IDC analysts.
Just 200,000 Windows RT tablets shipped in the first quarter, about 0.4% of the total tablet market of 49.2 million, IDC said in early May, prompting many analysts to call on Microsoft to scrap the OS that's built to take advantage of battery-efficient ARM chips. Intels x86 chips run Windows 8 tablets.
Some customers and analysts complained that RT tablets didnt support legacy Microsoft apps or Exchange email, making the battery efficiency and other features less desirable.
IDC updated its 2013 forecast for tablets earlier this week, dropping its projection for shipments of Windows RT devices from 4 million to 3 million.
Were seeing RT less and less, said IDC analyst Ryan Reith.
Meanwhile, IDC nearly doubled its 2013 forecast for x86-based Windows 8 tablets to 10 million shipped, up from 5.5 million in the earlier forecast.
IDC noted a dramatic upsurge in sales and shipments of sub-8-in. tablets during the last two quarters. It now projects that tablets of that size will make up 55% of the market in 2013, and rise to 57% in 2017.
Smaller tablets also equate to lower prices, IDC notes, and projects that the average price will drop by 10.8% to $381 in 2013. Further price declines are expected, IDC said. Some white box versions of Android tablets are already priced at around $100, especially in education markets in India and Indonesia, IDC said.