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Gift Giving Becomes Largest Digital Frame Growth Factor

8/17/2009 02:57:15 PM Eastern

Scottsdale,
Ariz. - Gift giving will be the largest motivator of future digital photo frame
purchases, according to a new study by In-Stat.

The study,
entitled "Wi-Fi
Represents Strongest Opportunity in Global Connected Digital Photo Frame Market" (IN0904506ID), found that 38
percent of consumers, who said they plan to purchase a digital photo frame in
the next 12 months, said they would do so as for a gift item.

"As a result, the coming holiday season will be crucial for
competitors in the digital photo frame market such as HP, Kodak, Pandigital,
Philips, Samsung and Sony," the market research firm said.

As popularity
increases in proportion to lowered price points, overall global shipments of
wireless and wired digital photo frames are on the rise, the company said. In-Stat
expects worldwide unit shipments of digital photo frames to reach 50 million by
2013.

"The weak economy is certainly
slowing growth in this market, as consumers cut back their discretionary
spending,"
stated Stephanie Ethier, In-Stat analyst. "However, pricing continues to fall and awareness is growing. In
addition, competitors are introducing next generation digital photo frames that
support advanced functions, such as multimedia playback of movie clips and
audio files, and include support for Wi-Fi or bluetooth connectivity."

Other findings
in the study include the following:

·        
Nearly
60 percent of U.S. respondents identified integrated wireless connectivity as a
desired feature on their next digital photo frame purchase.

·        
Growth
in digital photo frames creates a silicon opportunity that will exceed $550
million by 2013. Microcontrollers comprise the largest opportunity in
non-wireless enabled devices.

·        
The
bill of materials for a wireless 8-inch digital photo frame will fall below $36
by 2013. The LCD, the wireless module and the enclosure are the dominant cost
items.

Other findings
covered in the report include forecasts of digital photo frame unit sales and
revenue (connected and non-connected) by functionality segment through 2013, forecasts
of average selling prices and bill of materials for digital photo frames
through 2013, and- the total available market forecast for components and
silicon through 2013.