With an announcement by Hiroshi Lockheimer, Google’s Senior Vice President for Android, Chrome and Chromecast, that Android and Chrome OS will not merge, we have a few quick thoughts on how that affects the tablet market.

1. We had lingering suspicions about the rumor of a unified “Andromeda OS,” as it was floating around for so long without any corroborating evidence. The closest we got was Android apps being able to run on Chrome OS a few months ago. The time to release Andromeda really would have been with the Pixel C in 2015 to show that Google is serious about providing a productive work environment on its tablets. Instead, it is betting on Chrome laptops on being the answer to affordable productivity computing devices. Not a bad bet, considering their reach in the US market, but it does fall short of expanding that success into its large Android tablet installed base of 65% in 2016.
2. We expected a new Nexus/Pixel tablet by the end of 2016 and unless Santa has a trick up his sleeve, that window has all but closed. There has been speculation that 2017 would be the year when Huawei would release a new Nexus/Pixel tablet, possibly running the new Andromeda OS. The decision on where to take Google’s software no doubt had an impact on this delayed timing and puts a new Nexus/Pixel tablet in limbo.
3. Our latest forecasts are skeptical of a serious push on productivity and security from Google to make Android tablets acceptable in enterprise environments where Windows and iOS dominate the market. This news confirms our assumptions. Google’s OEM partners (Samsung, Huawei, Alcatel OneTouch) have already moved over to Windows for their productivity tablet models and this will only hasten that trend.
4. Lockheimer announced that advanced digital assistants backed by machine learning and artificial intelligence are Google’s way to unify Android and Chrome. Rather than think about combining OSes, Google will combine new experiences on both platforms through Google Assistant. Increasingly, this will be in lieu of downloading apps, favoring streaming apps (or “Instant Apps”) and bots. In a way, this unifies the experience but fundamental differences in security and multi-tasking functionality between Android and Chrome will remain. Currently, Google Assistant is completely unavailable on tablets as only smartphones can run the Allo app. Perhaps the newest Nexus/Pixel tablet will be the first step toward bringing Google Assistant onto tablets (see #3).

Android still has legs left in it as our most recent forecasts show that cheap slates for entertainment are still very much in demand. The problem there is that it is not the growing segment of the market. 2-in-1s are dominated by Windows and iOS, as are large screened tablets, and tablets for enterprise users. We have been skeptical that Google would be a major player in these segments and this announcement dashes any remaining speculation that it will do so via a more robust and secure OS, such as Andromeda. We will continue to watch how the digital assistant market evolves and what that will mean for tablet usage going forward.