LAS VEGAS—Mobile devices continued to push the consumer electronics industry forward as the weakening euro took its toll on Western European spending, said analysts from the Consumer Electronics Association (CEA) on Sunday (Jan. 8), just ahead of CES' official opening in Las Vegas on Tuesday.
Briefing the media on the state of the consumer industry and market trends, Steve Koenig, the CEA's director of industry analysis, and Shawn Dubravac, the CEA's chief economist, said trends impacting consumer electronics growth could be divided along economic, consumer and technology boundaries, with much of the growth currently being driven by emerging markets.
Global tech device spending in 2012 is predicted to exceed $1 trillion, with much credit for that going to smartphones and tablets, which have promoted growth even during times of economic uncertainty.
"There has clearly been a shift towards mobile devices, towards convergence and personalization," said Koenig, adding that emerging markets had added to the global market opportunity and broadened sales channels.Meanwhile, technology itself is pushing forward with ever-advanced embedded internet connectivity, miniaturization and the trend of built-in content, he said.
Despite the technological advances, however, the analysts noted that the success of the consumer electronics industry in 2012 hinged strongly on the survival of the euro. Both analysts noted that the single European currency's slide had badly affected electronics sales in Western European markets over the last months and that the situation could degenerate further.
"Retail spending is taking a real hammering," said Dubravac, noting that if the euro continued to weaken, spending would decrease massively.
"Developed markets will be the main drag on 2012," Dubravac predicted, though he admitted mobile computing would continue to see strong sales well into the year and possibly beyond.
"The global tablet market could top 100 million units in 2012," Dubravac said, declaring that netbooks and notebooks looked relatively strong moving into the following year. Notebooks, said Koenig, had mostly been cushioned from tablet cannibalization by netbooks, which had borne the brunt of the consumer ultra-portable craze.
Handset prices also continue to increase for the second year running, due to the continued increases in smartphone penetration.
"If you think everybody has a smartphone, that's not true, or at least, it's not true yet," Dubravac said. He acknowledged that price increases would not go on forever and would eventually come down.
Consumer demand will also continue to squeeze older technologies in 2012, creating significant shifts in spending patterns from traditional computing to more mobile computing, with prices for PCs set to sink even lower, "because they have to come down," said Koenig.
Desktop PCs have been reduced to a niche, said the CEA, seeing just 3 percent growth worldwide in 2011, while mobile computers saw a 10 percent global increase.
Asked whether Intel's Ultrabooks could change that, Dubravac said it was still "very early days" for the platform, which currently made up just 1 percent of the overall market, mainly from sales in Japan."Ultrabooks have plenty of potential, but it will take time," he said.
Meanwhile, emerging markets are leapfrogging technologies at an astounding rate, said Koenig, with countries like China transitioning directly from feature phones to high-end smartphones rapidly.
"In emerging APAC, the feature phone is really slowing," said Koenig, pointing out that China was seeing 21 percent year-on-year growth in the smartphone space. Chinese mobile companies like Huawei, too, were also managing to expand globally into places like Latin America, where they were establishing strong brands.
In terms of TVs, the CEA said the humble living room screen continued to play "a very significant part of the whole CE picture" despite slowed growth which saw TV unit sales up just two percent in 2011, with a projected one percent in 2012.
The real growth driver in TVs, however, is the shift to LCD technology, which Koenig said was pushing out other technologies at a rapid pace.
The CEA also said it expected to see a 56 percent growth in connected TVs, a 122 percent growth in 3D TVs and a 33 percent growth in LED TVs.