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You are here: Home / Personal Tech / CEA Predicts Healthy Gadget Market
CEA Predicts Healthy Gadget Market in 2009
CEA Predicts Healthy Gadget Market in 2009
By Jennifer LeClaire / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
The 2009 International Consumer Electronics Show is in full swing, and manufacturers are unveiling their latest innovations despite the down economy. What's more, consumer-electronics makers are expecting to sell plenty of them.

Indeed, in what marks refreshing news amid doom-and-gloom headlines, the industry forecast looks healthy. Specifically, the consumer-electronics industry is projected to generate $171 billion in U.S. shipment revenues in 2009. That's according to the Consumer Electronics Association's (CEA) semiannual industry forecast.

Gary Shapiro, CEA president and CEO, announced the forecast Thursday in his opening remarks at CES.

"The CE industry is resilient but not immune from the business cycle. In a tough economy, our products offer high value for entertainment and an entry point for entrepreneurs creating new businesses," Shapiro said. "Innovation will kick-start the economy. The 2009 International CES is a cause for optimism with some 20,000 new products and 300 new exhibitors."

Digital TVs Keep Selling

The CEA isn't just prophesying positive numbers to put a smile on the face of its members. The industry's statistics prove it held its own last year, despite credit crunches, slowdowns and recessions. In fact, the CEA's estimate of final shipment revenues for 2008 showed the industry reached a new high of $172 billion, an increase of 5.4 percent over 2007.

In 2009, overall, CEA projects that domestic-shipment revenues will essentially remain flat at $171 billion, a decrease of 0.6 percent over 2008. But "flat" is welcome news in an economy in which many other industries are seeing major losses.

Digital-TV displays are expected to be the primary driver in the consumer-electronics sector. Digital TVs make up 15 percent of total industry shipment dollars. Digital TVs, of course, are getting a boost from the nation's transition to digital broadcasting. Digital-TV sales are expected to approach 35 million in 2009, an increase of nearly six percent over 2008 shipments. LCD displays remain the top choice among consumers, representing 77 percent of total DTV units.

Betting on Blu-ray

The dust settled on the next-generation DVD format wars in 2008. That opens the door for dramatic growth in Blu-ray players in 2009. Indeed, Blu-ray players, which offer more content, more options and lower prices than just 12 months ago, could see revenues surpass $1.2 billion this year.

Beyond digital TVs and Blu-ray players, gaming is another major revenue driver in the consumer-electronics industry. The CEA predicts the overall video-game market should grow 11 percent, generating nearly $22 billion in revenue in 2009. That's a new high mark for the category. Meanwhile, software continues to drive the gaming market, buoyed by a growing installed base of next-generation consoles. Gaming software revenues are expected to grow 18 percent to nearly $15 billion.

"Consumers continue to seek the best picture, sound and entertainment experience available," said Steve Koenig, CEA's director of industry analysis. "With a majority of U.S. homes owning an HDTV, consumers are looking to add high-definition content through Blu-ray players, gaming devices, and home audio systems."

The CEA said more consumers are also choosing smartphones over feature phones. Smartphone revenues are expected to see 20 percent growth in 2009 to $13.6 billion. As carriers increase the speed of their networks and offer new services in addition to communication, the CEA predicts smartphones will account for more than 60 percent of total handset revenues.

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