CES 2009: CEA: Consumer Spending To Decrease In ’09

By Lisa Johnston -- TWICE, January 7, 2009

Las Vegas — Not surprisingly, it’s not looking like 2009 is going to be a banner year for consumer electronics.

That was the message given by Steve Koenig, industry analysis director, Consumer Electronics Association (CEA), and Shawn DuBravac, CEA economist, at the Venetian, here, prior to the start of International CES. However, the pair tempered the gloomy outlook by saying that CE is still faring better than other industries during the current recession.

Although consumers are cutting back on purchases that can be delayed, consumers view CE technology as something that is integral to their lives, they said.

Nevertheless, CEA is projecting consumer spending will decline 0.3 percent in 2009. “We’re projecting 2009 will be a bit worse [in consumer spending] than 2008, DuBravac said.

According to the CEA forecast, there will be a slight uptick in 2009 due to a federal stimulus program, but then consumer spending will decline again.

“2010 is when we get back on track,” DuBravac said.

“On the bright side,” he continued, “technology continues to outperform other industries. [Consumers] are continuing to allocate more dollars relative to what they’re spending on other categories … It’s becoming more of an integral part of their lives.”

The fastest-growing products for 2009 were forecast by Koenig and DuBravac as being OLED displays, e-readers, HD flash camcorders, netbooks/subnotebooks, climate systems communicating thermostats, next-generation DVD players, LCD TV with 120MHz-plus refresh rate, portable navigation (that are traffic compatible), MP3 players with wireless connectivity, and home theater in a box systems with Blu-ray.

Koenig and DuBravac also presented four trends they said that should be watched at this year’s CES. They included green electronics; evolving command, control and display products; the embedded Internet; and what they termed as “(No) Strings Attached.” Koenig described this last trend as “dichotomous”

“This trend really embodies the idea of cutting cords, but also we’re attaching strings in the form of services,” he said.