The organisers of the world’s largest consumer electronics show, CES, believe that smartphones, tablets and their integration with other products will dominate January’s show.
The Consumer Electronics Association’s Director of Industry Analysis Steve Koenig and Shawn DuBravac, its Chief Economist and Senior Director of Research took the stage at CES Unveiled London to layout their predictions for the show, and 2013.
CES has become one of the world’s largest trade shows, and launches on January 8 in Las Vegas. It is not open to the public. The past few years have seen the CES run smaller ‘preview’ shows around the world, with the CES Unveiled event held in London the last before the main event.
As a barometer of the technology market’s importance, Koenig and DuBravac stated what many of us already know – 76% of all gift purchases across the holiday period are tech – a trend that has remained unchanged for most of the past 10 years. This isn’t just a trend seen in developed countries, but worldwide.
“Technology scales well internationally,” said DuBravac.
“It has a high penetration rate, both here and smaller markets, such as the Middle East and Africa…. In places such as China and Brazil television purchases are also growing, for example.”
Unsurprisingly, smartphones and tablets dominated discussion concerning the next holiday season.
Across this year’s holiday period alone, sales of tablets are expected to double – with 32 million being shifted in the fourth quarter alone, according to CEA’s own figures. While these are figures based on the US market, DuBravac says that the trend is identical in the UK.
Much of this is being driven by a now three way tablet battle. The market, long dominated by Apple’s iPad series (the Mac Mini is reviewed in our November issue), now has to contend with the Microsoft Surface and high profile Android devices such as the Google Nexus 10. All three companies are running extremely aggressive advertising campaigns to attempt to make off with as much of this market share as possible. Windows 8 tablet/laptop hybrid devices are especially producing a tremendous amount of hardware innovation from the old vanguard of PC makers – who are desperate to not get left out in the cold as tablets and smartphones reach astonishing penetration levels.
For us consumers – this can only be a good thing.
Already there are nearly two connected devices per person (as of 2010), and by 2015 this is expected to read 3.5 per person. 50 billion devices will be in use by the world’s 7.6bn people by 2020.
CEA conducted a survey of the public, posing the question: “If you could get one technology gift this season, what would it be?”
The answer? 16% want a tablet, followed by 10% who want a television (most of which are now connected TVs), followed by smartphones at 8%. As representative of the old world order, Desktop PCs (2%), Blu-ray players (3%), MP3 Players (4%) and Notebook PCs (7%) have fallen by the wayside.
The impact on the US technology industry is so stark, that DuBravac believes that without tablets and smartphones the industry would shrink by 5%. As it stands, these two markets mean that it is growing by 6%.
So while the two analysts’ assessment of our 2012 tech Christmas will surprise few except the odd luddite, it is then no shock that these trends permeate CES from the bottom to the top.
The flow on effect from smartphone and tablet domination is the disruption of other industries. Video game consoles have fallen by 10.4% (just 13.8m are expected to be sold over the period), as have digital cameras (down 7.6% to 12.1m) – these pass-times are now more easily (and more cheaply) available to smartphone and tablet users.
The coldest fact for Nintendo (who is launching its WiiU console in a matter of days), Sony Playstation and Microsoft’s Xbox is that 29% of tablet users said they purchased their devices for gaming.
What is interesting is the new use cases that are being developed – while satnav, photography and gaming companies have been slow to respond to the rise of smartphones and tablets, other industries such as health, automotive and home entertainment are embracing the technology with open arms.
Attachable health readers and fitness meters that wirelessly synch with your iPhone, through to iPad and Android integration into car engineering systems (such as to run diagnostics) are appearing at the show. For the more mainstream – multiscreen viewing and remote control of home theatre systems are rapidly becoming the norm. Microsoft has been pushing its SmartGlass technology, which means users watching films of music on one device can seamlessly ‘pass’ it to the next device. For example, Dad can watch a movie on his tablet sitting on the tube, then when he walks in the door at home, it will start playing on the big screen TV as soon as he walks in the door – from the same position he left it.
Much of this is this kind of innovation is occurring through software, namely, apps – a market that now makes or breaks new products. This, combined with Cloud technology, is opening up whole new marketplaces.
DuBravac describes what CES has become quite simply: “It is now the largest app event in the world.”
This is a far cry from the stereos, fridges and even Playstations of years gone by.