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In 2014, 'phablet' is the new tablet

As large smartphones eat into tablet sales, Asia-based manufacturers are shifting resources accordingly, says Digitimes.

iPad Mini: An iPhone smaller than a Mini but larger than the current 5S would fit well into market trends. Apple/screenshot by Brooke Crothers/CNET

A new report from Asia buttresses analysis from leading market research firms showing sharp tablet growth deceleration as large smartphones become surrogates for the tablet experience.

"Tablets are gradually being replaced by large-size smartphones," aka phablets, according to a report published Tuesday by Digitimes, citing sources in the Asia supply chain of manufacturers.

That echoes analysis from NPD DisplaySearch and IDC. For example, IDC said in May that the "phablets...are often adequate for tasks once reserved for tablets."

Digitimes said that tablet shipment growth for 2014 is expected to be less than 5% as the "IT industry is gradually turning conservative about tablet's future...sources believe the tablet industry will see its first shipment drop in 2015."

One take-away from the report is that Apple's rumored large iPhones can't arrive soon enough. "Apple is also seeing less demand for its iPads," the report said.

Apple is expected to enter the phablet market for the first time with a 5.5-inch device, while it also bumps up the size of its current 4-inch iPhone to 4.7 inches.

The report also cites a shift at manufacturers to wearables, which is having an impact on Google's device strategy. "Google has already turned to focus on wearable devices," Digitimes said.