CES 2014 Tech Market Update: Here Comes China

CEA’s Director of Industry Analysis, Steve Koenig, led a press event on the state of consumer electronics titled “Around The World In 60 Minutes: Global Technology Market Update.” Heavy emphasis was placed on the rise of China and how the phrase “developing markets” is now a misnomer when used to describe the Asian market–  with $282 bn spent on consumer technology in China in 2013, it now outpaces North America. “Has North America’s share peaked?” he asked the audience rhetorically. “Yes it has.”

Currently growth in China is driven by urban centers, but Koenig points out that the country still has vast, untapped rural markets that will likely follow suit.  He was quick to point out that while Us and Chinese consumers are largely excited about the same range of products, consumer sentiment studies indicate the Chinese population is significantly more enthusiastic about spending its hard earned dollars on electronics.

Overall 2014 is projected to post a 1% decrease in overall spending on consumer electronics.  While smartphone and tablet purchases are likely to stay strong, spend will slow as unit growth shifts to low-end products aimed at volume penetration in emerging markets.

Lower-priced tablets also means smaller screen sizes– in fact, 66% of US tablet shipments in 2014 are projected to be less than 9”. That said, when it comes to TVs, the global community seems to rally around a “bigger is better” philosophy as average screen sizes continue to grow. Koening posits that global TV sales are returning to slow growth, driven in part for a desire for bigger screens and SmartTV functionality.  Ultra HD sales will increase significantly as well in 2014, but he cautions against great expectations quite yet.

Koenig ended on a positive note, mentioning that the next big home electronics boom may be on the horizon with technologies like 3D printing and wearable computing. That said, he was quick to point out that 2014 won’t be a year when those segments find popularity on the level of tablets and smartphones.





CES 2014: Trends To Watch

Shawn G. DuBravac, the Chief Economist and Senior Director of Research for the Consumer Electronics Association (CEA), kicked off CES 2014’s press events today by outlining four key trends he expects to see at this year’s conference:

1. Mass Customization

If the second Industrial Revolution (1860-1945) focused on mass production, we are now entering a third Industrial Revolution emphasizing “mass customization.” This started with websites like Café Press, custom stamps, and customizable sneakers from Nike, Puma, and Chuck Taylor. More recently Google’s Motorola X and the Kindle Fire’s mayday video platform pushed the envelope on customizable features and services.

DuBravac says 3D printing will be a “tremendous story this year” that extends the customization trend.  Similarly the low cost of sensors is poised to herald mass adoption of internet connected devices this year and beyond that enable personalized experiences based on our individual behavior and environments.

2. Age of Autonomy

With the advent of abundant cheap sensors and radios for every range, we’re entering an era of constant monitoring, feedback, and ability to make adjustments based on data coming in. That dynamic feedback will revolutionize not only our home and mobile technology, but also brick and mortar retail locations where changing demand and inventory levels can be constantly measured to improve operations and consumer experience.

3. Multidimensional Screen Expansion

2014 will see us expanding and enhancing the spectrum of screens.  This means not only a variety of screen sizes, but also factors like color, resolution, and curvature. “The wearable category will explode,” says DuBravac.  Smartwatches are projected to reach 1.5M shipped units in 2014 in U.S., but it remains a nascent market that’s “still looking for that killer application.”

In terms of form factor there’s a move toward flexible and bendable screens, but don’t expect big sales there quite yet. For now manufacturers will primarily use CES 2014 to show what’s physically and technologically possible. “It may be another 5 or 10 years until they’re commercially viable,” he concluded.

Ultra HD TV unit shipments should increase dramatically this year as well, but aren’t yet poised for a hug explosion.  That said, expect a few big announcements about content and services partnerships along the lines of the Netflix UHD streaming deal.

4. Curation & Context: Services Meet Systems

Right now algorithm like those employed by Netflix are based solely on your behavior on that platform– but DuBravac envisions a future where platforms can access information from your other connected devices to improve recommendations.  What if Netflix had access to your Basis watch and could determine how stressed you are? Or if could interface with a camera sensor to know how many people are in the room? What if Netflix was linked to your thermostat and could make movie recommendations based on the temperature outside or in your home?