CES 2014: State of the CES Nation? Good, Blah, Chinese

Written by Lamont Wood

What’s the state of the CES 2014 nation? Good, blah … and overwhelmingly Chinese, says our Lamont Wood, who is reporting for aNewDomain this week from Las Vegas. Analysis.

aNewDomain.net — From CES 2014 in Las Vegas, our Lamont Wood reports that consumer electronics, as an industry, is moving into the realm of mass customization. Here’s more on what analysts say about the state of the CES nation …

As buyers await the next wave of innovation, the long-awaited moment when the Chinese market is bigger than the North American market has actually arrived.

Such were the finds laid out during the so-called CES 2014 Analyst Briefing, part of the opening event here at the International Consumer Electronics Show (CES 2014).

The rise of customization in consumer electronics may amount to a third industrial revolution, as more and more vendors — such as Motorola with the Moto X — let buyers specify every detail of their purchase, rather than shovel out mass production, noted Shawn DuBravac, chief economist for the Consumer Electronics Association, sponsor of CES.

As an indicator of customization’s popularity, 99,000 3D printers were sold in the U.S. last year and there was a waiting list for vendors wanting to be in the CES 3D printers’ pavilion, he added.

The industry is also seeing the dawning of a so-called Age of Autonomy, as sensors get cheaper and more and more are added to devices, leading to things like cars that can parallel park themselves. As the various industries solve more and more discrete problems, these solutions can be combined into “holistic experiences,” he predicted.

For instance, Netflix is able to predict what movies you will generally want to watch by combining basic demographic data with your buying history. But by combining knowledge of the temperature outside, how many people are in the room, your blood pressure and so on, it will inevitably be able to predict what you’d be in the mood for at a given moment, he said.

As for the resulting privacy and security issues, vendors are still sorting them out,  DuBravac said. (Meanwhile, the CES attendees’ badge this year includes an NFC circuit, leading to convention-wide rumors that the showgoers were being tracked. Is it true? No way, DuBravac said. The technology was not that good.)

As for what is being sold and where, CEA economist Steve Koenig said the global consumer electronics market amounted to $1.068 trillion (yes, trillion) in 2013, representing a three percent growth over 2012.

But Koenig expects the total to fall one percent in 2014 as vendors slash prices to keep customers coming back — there being no wave of innovation to keep their attention otherwise.

Indeed, the main new technology in the pipeline are the Ultra HD TV sets, but DuBravac said that 2013 sales in the U.S. amounted to only 60,000 units, and half a million are expected to sell next year — as compared to 40 million conventional TV sets. That said, a number of UHD TV accessories and services will be unveiled at the show, he added.

Meanwhile, about 43 percent of global consumer electronics spending is on smartphones and tablets. That segment continues to grow, but it is cannibalizing the markets of a range of devices that they replace, such as still cameras, MP3 players, GPS devices and portable game devices.

And the smartphone and tablet market is not growing as fast as the other cannibalized markets are shrinking, he complained.

Presumably, that’s because smartphones and tablets replace multiple devices.

But the big news, Koenig said, was that last year the North American consumer electronics market amounted to $257 billion and the Chinese market surpassed that figure at $282 billion. The North American market has apparently peaked, but the Chinese market is just getting warmed up, he said. Sales are just now starting to be seen in rural areas, where 75 percent of the population in China lives, he added.

And that’s the state of consumer electronics as CES 2014 sees it. Good, blah and Chinese.

For aNewDomain.net, I’m Lamont Wood.

Based in San Antonio, Texas, Lamont Wood is a senior editor at aNewDomain.net. He’s been covering tech trade and mainstream publications for almost three decades now, and he’s a household name in Hong Kong and China. His tech reporting has appeared in innumerable tech journals, including the original BYTE (est. 1975). Email Lamont at Lamont@anewdomain.net or follow him @LAMONTwood.

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