I recently came across the an article on Recode.net about how the tablet vertical is in a slow death spiral (http://on.recode.net/1drfOz4) written by Zal Bilimoria. I thought it was a great article and largely agree with his conclusions. In particular, it highlights how human information culture changes as technology changes. 

Mr. Bilimoria was head of mobile at Netflix during the tablet mania post-iPad launch and writes about how tablets were gobbling up browser share among Netflix 's customers.  In response the mobile team built out the tablet app separately from the smart phone app and designed it specifically for the tablet experience. Initially, the app was a hit, and it won awards due to great user experience. However, after awhile tablet usage dropped off and phones began to see greater browser share, which caused the mobile team to merge the tablet app back into the phone app once again creating a single user experience. 

 He cites two main reasons for the growth in phone usage and subsequent decline in tablets: mobility and connectivity.  Mobility being that tablets are awkwardly sized to be that " take anywhere device" nor can they replace a desktop computer and connectivity in that only a small percentage of tablets have celluar connectivity so tablets often rely on wifi, which allies them more often with traditional computing devices. He thinks that the tablet market will eventually morph into single purpose devices like household appliances or that the same consumer energy would direct companies to produce larger phones (i.e. Phablets), and tablets as we know them today will occupy a niche market.

I agree with Mr. Bilimoria and would not call tablets a separate vertical as they couldn't replace a traditional desktop (or notebook). I would say they are an excellent secondary device. I often have my tablet sitting next to me as I work on my laptop, and I use it to play my music or chat via Google Hangout/FaceTime.  I essentially use my tablet as a "notebook-light"; I use it to consume media through for work or other serious projects I return to my notebook. If tablets do become a niche market as  Mr. Billmoria suggests I would suspect it would be in the medical field, retail sector etc where mobility is often a factor.

It will be curious to see if the larger tablets are overtaken by larger phones as the portability mentioned earlier could then become an issue due to device size.  I have seen many larger phones and personally the size seems awkward to me (though in fairness I haven't ever owned one to see how it fit into my life). 

 References:
Our Love Affair with the Tablet is Over by Zal Bilimoria (http://recode.net/2014/02/06/our-love-affair-with-the-tablet-is-over/) Published on: 02.06.2014 and Accessed on: 02.25.2014