Spending on consumer electronics devices worldwide is expected to top $1 trillion in 2012, driven in large part by tablets and smartphones, according to research released Sunday by the Consumer Electronics Assn.
Televisions, long a robust category, are losing momentum. Sales of TVs were up 2% in 2011 and are expected to be up another 1% in 2012, to 262 million units. However, that growth is concentrated in emerging markets; the developed markets of North America, Western Europe, Japan and Korea are nearly saturated.
Tablet sales, however, are projected for explosive growth: 96 million-100 million units worldwide. That’s a growth rate of 65% year-on-year, and they’re expected to be a full 5% of the worldwide CE market. “Because (tablet sales have) grown so rapidly in North America, it’s practically peaked already,” said Steve Bambridge of GfK Boutique Research, which worked with CEA to compile the data. “But there’s a lot of other growth to come in other markets.”
The driver of the CE market in 2012 is expected to be the smartphone, repping 22% of all CE spending, up from 18% in 2011.
In fact, most other product categories are leveling off or actually beginning to contract.
Home audio, digital still camera and LCD TV sales showed small increases in 2011, but the energy is all in smartphones and tablets. Western Europe in particular is a strong market for high-end smartphones.
In fact, said Bambridge, “The rush into smartphones has squeezed other portable device categories: car navigation, camcorders, portable media players… All of these are losing their relevance as the smartphone takes over their functionalities.” In the camera market, he noted, compact cameras are declining, but high-end digital SLRs are holding their ground.
Consumer spending on consumer electronics continued to rebound from the 2008-09 economic crash, but Western European figures continue to be depressed as several economies there remain on shaky ground. Meanwhile, the emerging markets — Central and Eastern Europe, developing Asia Pacific (including India and China), Latin America and Middle East/Africa have grown to 46% of the world market and are the most important center of growth. Demand for LCD TVs is especially strong in the emerging markets.
CEA presenters described emerging markets roaring ahead while developed markets are plateauing. The BRIC markets (Brazil, Russia, India, China) are leading this trend, with growth rates around 50%. “These emerging economies really are the focus of growth,” said Steve Koenig, director of industry analysis for CEA.
Overall consumer spending on CE products was up 8% in 2011 worldwide, and was up in every region: In developed markets North America 10%, Western Europe 2%, and developed APAC 2%. In emerging markets, Central/Eastern Europe was up 18%, emerging APAC 17%, Latin America 11%, Mideast/Africa 8%.
LCD TV purchases grew 5% in 2011 but were down 3% in Eastern Europe. 3D TV is doing better than some reports have indicated, Koenig and Bambridge said, with steady growth in the U.S. market.
To date, they said, that growth is linear, instead of the usual “S” curve of slow initial sales, rapid adoption and then leveling off.
However, the market with the greatest 3D TV penetration is China, where passive glasses were applied to inexpensive sets. “What are they doing with those 3D TVs?,” said Bambridge. “Because there’s not a lot of 3D content in China, which goes to show if you drive the price low enough, people will take the product.”