Tuesday, January 6, 2009

CES First Post: Breaking the Duck with the Numbers Guys

Great stuff in the first two CES sessions, hosted by Steve Koenig (Director, Industry Analysis), Shawn DuBravac (Chief Economist), and Tim Herbert (Senior Director, Market Research). If you read no further, here's what you need to know:
  • Worst two-year consumer electronics economic period since the early 80's
  • Still, global CE spending will top $700 billion in 2009, with BRIC (Brazil, Russia, India, China) as a major growth driver
  • Consumer spending on technology continues to outperform total durable goods spending
  • Netbooks grew 2000% last year, from 300k-400k units to 10 million, with a further 80% growth expected in 2009--in Koenig's words, the market "materialized overnight"
  • 120 Hz LCD TVs grew a staggering 810% last year, with e-readers (265%) and 1080p plasmas (215%) as the top three U.S. growth areas; nine total product categories more than doubled year-over-year, but we can say sayonara to that for this year...
  • OLED (149% growth), e-readers (110%), and HD flash camcorders (106%) are the only categories projected to double year-over-year in the U.S. in 2009
The CEA’s guys identified four key consumer electronics trends for 2009: Green as a purchase factor; embedded Internet; evolving command, control, and display; and (no) strings attached.

Green is becoming more recognized and more of a consideration in the purchasing process. However, 38% of consumers say they’re confused about green claims; 59% say they want to know the specific attributes that make a product green; and 65% believe that some companies overstate their green credentials to sell more product.

Hallelujah. So many companies have identified and latched onto green marketing that it’s almost impossible for even educated consumers (a group in which I consider myself) to figure out just what the heck "green" connotes. Various entities have attempted to define what “green” actually means; the USGBC’s green building efforts (in the form of LEED) are very well-recognized, and the IEEE’s EPEAT efforts in conjunction with EPA and many industry stakeholders (including IEEE 1680.3’s work on environmental assessment of televisions, in which I’m involved) should yield great benefits in terms of defining green. But right now, it’s a freakin’ mess, as evidence by the pissing match between Dell and Apple a few weeks ago. I’m not sure that I’m advocating for the world’s advertising bureaux to step up and establish some ground rules. Then again, I’m not sure I’m not. If the CEA is able to provide guidance to its members on how to classify and clarify “green”, it’ll be a win-win all around--assuming the CEA team can actually convince members to adhere to said guidance.

One other area of note is that green features could very well end up trumping brand in the purchasing decision. They didn’t say it, but the caution to manufacturers is, ignore green at your peril, particularly in this day and age of waning brand loyalty.

Trend #2 is embedded Internet--basically, making devices smarter and more valuable by providing Internet connectivity as a feature, rather than as an add-on. Since these are CE guys, I didn’t expect to hear them mention Metcalfe’s Law (they didn’t), but the net-net (pun intended) is that Internet connectivity is coming to a broader range of devices, enabling manufacturers to deliver consumers the promise of a connected lifestyle--as one of the economists noted, consumer technology bridges the personal and professional lives of more and more people each year. As a huge fan of the promise of DLNA, I want all the devices in my home to connect, seamlessly. I want devices to be easily discovered. I want to be able to come home and sync my camera without needing to plug it into anything. Cable replacement is interesting; more on that in a moment. But, give consumers an easy network capability, combined with the ability to cut the physical connectivity cord, and you have a clear winner.

Trend #3 is embedded command, control, and display. Thankfully, they referred to the category by all three names most of the time; every time they just said “command and control”, I thought I was in a C2 briefing. Next door, a C4ISR briefing. No, no, no...their point was, input is a whole new ballgame--haptics, accelerometers, and more. They showed statistics on the evolution of the user interface, in terms of how consumers are looking to interact with the PC over the next 5 years. Sadly, the MacBook Wheel wasn't mentioned as a viable option, but one can always hope. (Thanks, TL)

I've never been a big believer in tablet computing, since I can't read my own handwriting. But, as much as I'm a fan of the trackball on my BlackBerry Curve, I'll admit that touch-screen capabilities certainly have a place, whether you're a fan of entirely virtual keyboards (e.g., the iPhone or BlackBerry Storm) or physical keyboards mixed with touch screens (e.g., my old Treo 650). One of the coolest new devices I'm looking forward to checking out is the LG Wrist Phone. Ergonomics and usability are as important as packaging; hopefully they've gotten it right, at least as a first attempt.

Trend #4 is the one that hits home for me--(no) strings attached. Lots of devices have cut the cord over the last couple of years, leading to a plethora of standalone wireless devices. As holiday gifts, I bought a few digital photo frames for various folks. But, their inability to be easily (and using the metric of my wallet, cost-effectively) updated over the Internet somewhat limits their functionality at this point. Sync services from Microsoft, Google, Apple, and others will provide significant added value to what are today wireless but disconnected devices. Thankfully, the CEA guys didn't use the term "cloud computing", but that's one of the key capabilities sitting behind these devices which will make for a much better consumer experience.

One other trend that didn't make the top 4 (but that I guess you'd call #5) is the growth of netbooks, validating my immediate previous post. (Thanks, CEA)

The final trend they mentioned was 3D TV. While still in its early days, TV manufacturers are looking to 3D TV as the next wave of TV innovation. CES Unveiled had demos of 3D technology using both colored glasses and shutter glasses. I didn't check out either, but that's a goal for tomorrow.

And, coming tomorrow, thoughts on what could be my new favorite Bluetooth headset. You heard that right--is this my death knell for the Jawbone 2? We'll see...stay tuned.

1 comment:

  1. I thought "green" meant "low power". Hey, isn't that the whole POINT of CE?

    Check out the display glasses. Last year's CES had several new products that made for reasonable substitutes for full-size displays. When I can watch a movie on my phone from some heads-up glasses, I'll know I've arrived.