Global Tech Trends from CES
January 9, 2012, CES, Las Vegas—Steve Bambridge, Global Business Director, GfK Boutique Research and Steve Koenig, Director of Industry Analysis, CEA talked about the changing shape of the global tech device markets. The changes are tabulated by region and category.
The developed regions of North America, Europe, Japan, and Korea are seeing signs of increasing consolidation. At the same time, the emerging markets like Brazil, Russia, China, and India are growing very fast. The valuations are greatly affected by exchange rates (all numbers are US $ equivalent) but ignore sales and VAT taxes and technology subsidies. The numbers do not include the very big 4th quarter, since the quarter just ended a week ago.
The trends for economic, consumer and technology areas vary by region and currency. The emerging markets are great opportunities as the sales channels grow and prices drop. Europe has many issues as consumers look for greater connectivity and mobility. The convergence of consumer, communications, and computing is leading to greater personalization. Technology is moving into embedded Web functions that take advantage of the connectivity and the availability of cloud computing. Consumers are looking or more built-in content in their devices.
Consumer electronics is projected to increase by 5 percent to exceed $1T this year. The economic issues facing the Continental areas are a huge factor that can make or break the forecast. The growth in the emerging markets may not be able to compensate for the financial malaise in Greece, Italy, and Spain.
Emerging markets are growing from the bottom up, meaning that pricing is a big issue. The emerging markets are forecast to grow by 46 percent from $370B to $482B. Even in the emerging sectors, there are regional differences. Latin America grew 34 percent in '10 but dropped to a negative 11 percent last year. In comparison, the emerging Asia-Pacific countries grew over 17 percent in '11. the emerging markets will grow much faster than the developed markets.
The European market is unusual. In '12, it is expected to drop about 3 percent or at best be flat. The pressures on the Euro will determine if the area grows or collapses. The currency and financial challenges in Italy, Spain, Greece, and even in the UK will be hard to overcome.
An accelerating trend is for the mature markets to become flatter, while the emerging markets are growing. India and China are experiencing very large growth year-year and account for 22 percents of the world-wide market. This is larger than North America which holds on to 21 percent of the market. The European Union countries have another 20 percent. The emerging countries are growing at a 20 -50 percent rate on an annual basis.
The growth areas for consumer electronics are in smart phones and tablets. Smart phones are expected to garner almost a quarter of the total market, and all mobile phones will be almost 30 percent of the total consumer market. Tablets are growing faster than the other computer systems but are only about 5 percent of the market at this time. LCD TVs and mobile PCs each hold about 15 percent of the market but are slowing in growth. Most of the other categories are shrinking and many are under 2 percent of the market.
Gaming consoles and printers are still in the mix. The high-end DSLR cameras are growing, but MP3 players and camcorders are dropping due to the encroachment from the smart phones. The emerging markets are starting to move to the bigger products like LCD TVs and smart phones. Mobile handsets are still growing at over 1 percent a year overall. The good news for the manufacturers is the average prices are going up for mobile handsets.