Consumer Electronics Revenue Expected Down, But 20,000 New Products Introduced
CEA executives described the current period as a transitional one between the growth spurt produced by the introduction of smartphones and tablets in the last few years and the next big wave of innovation. Koenig said “… we are waiting for the next cycle of innovation to lift us again… “
Smartphones and tablets will account for about 43% of all spending in 2014, says the report. Unit sales of tablets and smartphones will still be strong and overall spending in those categories will grow, but manufacturers are pushing less expensive products, which will slow the rate of revenue growth at a time when no new “must-have” category of devices has emerged.
Only eight product categories make up 79% of global spending in the consumer electronics categories. In 2013, smaller, less expensive 9-inch tablets accounted for about 66% of all tablet spending. In addition, global smartphone prices have fallen from about $444 in 2010 to $297 for 2014. Still, sales of both items will be strong, and the CEA is predicting that tablet penetration in the U.S. will cross the 50% penetration level in the next few months.
TV sales are expected to slightly rebound globally by 2% in 2014 to about $247 million, and the group is expecting that the market will stabilize at around 260 million to 275 million sets per year. Newer, UltraHD sets will see major increases in sales this year, to about 8.7 million units, says the report, but most of that action will occur outside the U.S. The CEA is predicting that about half a million UltraHD sets will be sold in the U.S. in 2014, up from just under 60,000 in 2013. Sales will increase to around 2.9 million in 2017.
Shawn DuBravac, chief economist and senior director of research at the CEA, notes that “… we are very early in the rollout of UltraHD… with under 60,000 units sold in 2013 growing to half a million in 2014, it is still an emerging market… ” but, the CEA expects that about 20,000 new products would debut at this year’s CES.
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