CE's Changes Seen At CES

International CES celebrated its 40th anniversary in Las Vegas earlier this month with many of its old friends — established consumer electronics manufacturers, retailers and distributors — and possible new ones — members of the content community.

Yes the "content community." Great phrase, since it covers a multitude of industries such as the music labels and movie studios, broadcast TV networks, cable and satellite TV providers, game companies, Web sites — you name it. As Consumer Electronics Association president/CEO Gary Shapiro once said, CES probably attracts more executives from some of these industries than their own main conventions do. This year his observation seemed right on the money.

Among the keynote speakers, Industry Insiders and Supersessions during the show there were the heads of Disney and CBS, Microsoft, Dell and Cisco, Motorola and Nokia, not to mention a laundry list of satellite and cable TV executives.

But there were precious few traditional CE manufacturers in the mix. Not that I'm complaining. "Traditional CE manufacturers," whoever they are nowadays, had tons of opportunities to interact with the 140,000 or so attendees during the show and pitch their wares. It's just an illustration as to how the industry has changed dramatically just in the past year or two.

Not that I remember the first CES back in 1967, but not so long ago a consumer electronics company could, in the words of a now-retired CE executive, "Develop a technology, make a product based on it and bring it to market without worrying about what the hell the movie and record people had to say about it."

That's so 20th century, isn't it? No, I'm not going to get into the merits of the 1984 Betamax case, but the content guys hanging around and participating at CES only goes to show that they have begun to learn that for their future business models to succeed they will have to try and work with the CE industry rather to fight it in court and in Congress.

As Shapiro and others have pointed out over the past few years, the CE industry's ability to create new technologies often results in disrupting old business models and creating new ones. For instance, the ability to quickly (and hopefully inexpensively) download movies, hit TV series and the like via the Web onto your computer or on your cellphone will create new markets for everyone.

The key is networking — both between industries and between the devices that carry the content — so that everyone involved in the transaction is a winner. That includes the consumer, who some always seem to either forget or take for granted.

Let's hope that the 2007 International CES is one that is remembered for a real change in the working relationship between content providers and the CE industry. At least at the beginning of this new year we can hope for change.