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IFA Celebrates The Good, And Some Bad

BERLIN – There was some good news and some bad news for the global consumer electronics industry on the first day of IFA.

For the industry, it seems the recession has returned. According to GfK, global sales of consumer electronics goods enjoyed a peak last year of 765 billion euro ($1.06 trillion) in total sales. But GfK expects worldwide CE sales to dip to 746 million euro ($967 million) this year and a projected drop to 737 million euro ($955 million) next year.

An increasingly uncomfortable share of this sales value rest in one product: smartphones. Last year, smartphones accounted for 34 percent of the total monetary value of CE sales, according to GfK, projected to rise to 39 percent this year.

That’s good news for smartphone sellers, bad news for LCD TV retailers.

This year will be a record year for unit sales of LCD TVs, reaching 299 million units sold worldwide. But according to Hans-Joachim Kamp, chairman of the supervisory board of GFU, which organizes and runs IFA, pricing is “a race to the bottom.” According to GfK, the average sales price of LCD TVs has dropped from 473 euro ($613) in 2011 to 417 euro ($542) this year.

The story is sadly the same for major appliances. Worldwide sales are down slightly worldwide for the first half of the year, and would be down more if not for the 10 percent to 15 percent growth in the booming Indian market.

Slightly more encouraging are majap sales in the U.S., up between 3 to 5 percent but still not yet back to pre-recession sales levels. But, “we anticipate growth for the year as a whole,” forecasted Reinhard Zinkann, chairman of the home appliance division of the German Consumer Electronics Trade Association ZVEI.

While sales of consumer electronics and appliances aren’t exactly encouraging, IFA itself is thriving.

This year’s show is the biggest ever, with a record 149,500 square meters (1.61 million square feet) of exhibit space, up 2 percent over last year, and a record 1,538 exhibitors, up 3 percent from last year’s show.

IFA executives kept referring to IFA as the No. 1 “consumer and home electronics show,” but this boast is based largely on its inclusion of appliances (the “home” part of the description), which makes it a slightly different animal than International CES. CES, however, still rents nearly twice the exhibit space (2.06 million square feet) to more than twice as many exhibitors (3,673), although the gap between the two shows has been closing in recent years.

This year’s show is also presenting a more impressive list of keynoters than in the past, including Samsung CEO Boon-keun Yoon, and Matt Rogers, co-founder of Nest, which was bought by Google last January for $3.2 billion.

IFA also finally opened its long-awaited new City-Cube facility, which is where this year’s keynotes will be held and which will be occupied by Samsung. This gleaming facility accounts for most of IFA’s increased amount of exhibit space.