MUNICH, Germany Ė The biennial Electronica exhibition and conference got off to a quiet start here on Tuesday (Nov. 13). While the "A" halls, that are home to the semiconductor exhibitors seemed busy enough, certain key indicators, such as the crowds on the subway and in the atrium area prior to the initial opening of the show, seemed smaller than in previous years.
In fact there were empty seats on my U-bahn train as I made my way toward the Messe fairground at about 9:00am on Tuesday. I have never experienced that and I have been coming to Munich for more years than I care to mention. In other years it has been standing room only and sometimes it was not physically possible to get on a train at the stops close to the Messe forcing would-be attendees to travel back into the city center to try and get "upstream" of the crowds and be able to board a train.
People tell me Wednesday and Thursday will be the busier. For now this Electronica feels similar to that of 2008 which came just two months after financial services company Lehman Brothers filed for Chapter 11 bankruptcy protection. That was the start of a bleak winter of discontent and a few more quarters besides.
Right now I only have anecdotal evidence but I have heard some exhibitors express satisfaction with the traffic on their booths. Official numbers will be issued by the Electronica organizers Messe Munchen at the end of the show.
So what is happening in 2012? The exhibitors are still there in force but how much longer will that be the case if the crowds do not also show up? Or perhaps the key attendees were always a relatively small percentage of the show traffic and are still here?
It has to be acknowledged that the electronics industry is changing and changing particularly in Europe. As a components-based exhibition Electronica was always one that was favored by design-in and manufacturing companies looking to find components, component ideas and to make buying decisions. There are large parts of the German manufacturing industry that still looks like that; industrial, automotive, embedded sectors continue to be strong here. The old-fashioned family-run businesses that remain privately held and see the virtue in making things have become a popular image here. They are also an explanation as to why the German economy continues to be the engine of Europe.
But it is now the case that the number of semiconductor companies attending Electronica has reduced over time and the biggest booths belong to the distributor companies that support chip sales to the mass of smaller companies. And globalization has taken a toll on Europe which also has its own austerity crises playing out in various countries from Ireland to Portugal to Greece. It may well be that engineers in the more far-flung parts of Europe just did not make the trip to Munich this time.
The hope remains that those engineers are still gainfully employed, but are "heads-down" trying to innovate their way out of the stagnation and hard times they find themselves confronted with. There is at least some anecdotal evidence of interest in R&D products at Electronics such as instruments, oscilloscopes and so on. The argument runs that R&D spending is an early indicator of more general production spending.
So perhaps it is a case of "quiet, engineers at work."
Like pretty much everything these days, trade shows could use a bit of re-inventing. I don't think the online "shows" are a threat to the in person shows. The formula just isn't there. But I think work load and tight budgets are competition.
Shows/conferences need to look for more activities that can only happen live and in person and are more valuable than the cost of plane, motel and a weeks engineering time.
I hear a lot about the aging of the engineering work force, and I think there's merit in that train of thought. But there are also plenty of younger engineers and they operate differently. Their sense of time is different. I can remember a time when contracts went back and forth by snail mail, parts orders took weeks to arrive and prototypes were built by hand.
Now "paperwork" goes back and forth instantly. An engineer can go from CAD file to finished prototype in just a few days. Everything is compressed for these folks and that needs to be accounted for.
I looked at several conferences this year and the price tag was significant when including a continental flight. At least for US travelers elevated travel costs may have crossed the breaking point? It definitely has for small businesses like the one I currently work for.
Isn't that the case for a lot of European tech shows? I remember when CEBIT used to be an important show.... but the last few years, it's been a tech graveyard. I don't feel like shows in the U.S. or Asia are getting any less busy though, so maybe Europe is the problem.