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CE Spending To Drop 17%: Report

9/16/2010 02:32:40 PM Eastern

Framingham, Mass. - U.S. consumers will spend 17 percent less on
CE this year than last, a new report projects.

But despite the decline - the largest among 20 large,
industrialized nations - important opportunities still exist within key product
categories like netbooks, smartphones and HDTV, and across specific consumer
segments.

And even though U.S. consumers are spending less on CE, they tend
to buy higher-end devices with more features and functions than consumers in
other markets, according to the report's author, International Data Corp.
(IDC).

"The survey found U.S. consumers to be extremely price sensitive,
a clear sign that the economic downturn has had an impact not only on spending
habits, but also on consumer psychology," observed IDC consumer primary
research director Michael DeHart. "At the same time, U.S. consumers are far
less likely to buy simple, basic devices, which is indicative of the
population's strong affinity for consumer electronics."

IDC believes long-term growth opportunities exist in netbooks and
peripherals as PCs become increasingly viewed as personal CE devices. In
addition, with smartphone penetration at only 28 percent of U.S. households,
category growth is a "sure thing," the research group said, along with a range
of features, data plans and apps to suit different budgets.

Similarly, HDTV ownership has only now crossed the 50-percent
mark among U.S. households, promising a continuation of the category's
"dramatic growth trajectory," IDC said.

The report, U.S. Consumer Insights - Beyond Early Adopters, the second
in a series from the group's ConsumerScape 360 service, further divides the U.S
marketplace into six distinct consumer segments:

·        
Engaged Hipsters (young and trendy, likely to
buy the latest and coolest devices);

·        
Tech Evangelists (the most adept and influential
technology users);

·        
 Savvy
Sale Shoppers (moderate interest levels but will buy if the price is right);

·        
Impulse Buyers (high income buyers that purchase
whatever new products catch their eye);

·        
 Socially
Conscious Basic Buyers (family- and environmentally-focused, unlikely to buy
what they don't need), and;

·        
 Disengaged Functionalists (low income buyers
with little interest in CE).

IDC found that more than half of the U.S. population can be
characterized as basic buyers (disengaged functionalists and savvy sale
shoppers), reflecting the current state of the U.S. economy. Moreover, the
number of disengaged functionalists is significantly higher in the U.S. (34 percent)
than in the other countries surveyed (16 percent worldwide).