1.64 million tablets were sold in Australia in the second half of last year, with convertible Windows '2-in-1' devices accounting for over a quarter.
In the OS race, Windows (27 per cent) has almost overtaken Android (29 per cent) - but is still well behind Apple (44 per cent).
The figures were revealed in the Telsyte Australian Tablet Market Study 2017.
Telsyte says Australian sales of Windows tablets grew around 60 per cent half-on-half (2H 2016 vs 2H 2015) while during the same period Android tablet and iPad sales declined 13 per cent, and 9 per cent respectively. Convertible '2-in-1's led the charge with the category now making up 30 per cent of sales, up from 15 per cent in 2H 2015.
This shows Australians moving away from low cost tablets, with less than 10 per cent of tablets sold in 2H 2016 falling into this category. 40 per cent of Australians are now willing to pay more for "top quality electronics".
Australian tablet users on average spend around 2 hours per day on their tablets, with primary usage still being at home (over 80 per cent). The time spent on 2-in-1 tablets is more than 3 hours per day and over 30 per cent use them outside of home.
"Tablets are no longer just about media consumption, touchscreen devices are revolutionising the creative experience," Telsyte Managing Director, Foad Fadaghi, says.
With the introduction of larger format, desktop touch computers - such as Microsoft's Surface Studio - we should see a boost in an otherwise sluggish PC market which has struggled to give users a reason to upgrade. The average replacement cycle for PCs in Australia has now grown to 4.7 years.
Microsoft and its OEM partners will cater for different segments of this market developing both tabletop and desktop touch interfaces using Windows 10 in various form factors, Telsyte believes.
It is predicted that by 2021, at least 10 per cent of desktop PCs sold will have touch screen interfaces, with more pervasiveness expected as screen price come down. Currently large format touch screens are more closely aligned to creative professionals, businesses and high end household budgets than the mainstream buyer.
Around 80 per cent of the ICT decision makers in Australia and New Zealand surveyed indicate that they are already buying or interested in purchasing larger format touch screen computers for their organisation.
Despite a slowdown in tablet unit sales from the boom years of 2012 to 2013, the market for tablet-related accessories continues to be a profitable category for leading retailers. 71 per cent of tablet users have at some stage purchased some form of accessory for their device, with the top add-ons in 2016 being cases and keyboard-type covers.
In addition, sales of pen input or stylus devices featured prominently for owners of 2-in-1 devices.