Electronics Industry Is Evolving

On the eve of the Consumer Electronics Show (CES) in Las Vegas, we’ve been taking a look at changes that the consumer electronics industry is undergoing.

The research firm NPD Group sent us an interesting study over the weekend. They took a look at sales numbers from 2010 and 2011. They stripped out some of the new technologies, such as cell phones, tablets, and games, and focused on the old standbys: TVs, PCs, DVD, GPS and MP3 players.

The snapshot they got displays an industry in the midst of change, and in a struggling economy.

Stephen Baker, vice president of industry analysis at NPD, said in an email to NFS:

“2011 was the first year in quite awhile where the real drags on the core CE marketplace were not TVs and PCs. Revenue for those two segments outperformed while the rest of the market dropped by more than 7 percent. The accelerated rate of decline in older technology categories such as DVD, GPS and MP3 players put a ceiling on how well the industry could perform during the holiday.”

And indeed the study showed exactly that. Holiday sales of GPS devices fail 31.6% in 2010 and another 32.6% in 2011. MP3 players were down 2.5% in 2010, and 20.5% in 2011. Blue-ray players were up 3% in 2010, but down 17% in 2011. Interestingly enough, even camcorders and cameras are taking a hit. Camcorders were down 15.2% in 2010, and 42.5% in 2011. Point-and-shoot cameras were down 13.2% in 2010, and 20.8% in 2011.

Apparently our appetite for bigger TVs remains strong though. Sales of TVs with screens over 50 inches were up 32% in 2011, and the share of TVs over 60 inches more than tripled. But the most common size, 32 inches, saw a decrease in sales of almost 9%. Sales of 3-D TVs grew by over hundred percent, and the study found that $1 out of every $5 spent on TVs were spent on 3-D TVs.

The sales revenue on home theaters was up as well, by 10%. Streaming devices were up by 65%.

“It was truly a mixed bag this year,” said Baker. “Many newer technologies posted strong gains, although most of those products, such as streaming devices, still generate volumes too small to impact the overall market trend. These newer technologies are likely to be the ones to watch in 2012 as the industry continues to search for high growth opportunities to replace aging product segments.”

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Faroh Sauder has spent more than 30 years working as a journalist and educator. He has written on politics, international affairs, civil rights, and consumer education. Now mostly retired, Faroh continues to stay current on tech and consumer issues and reports on his interests here at News For Shoppers.