Distributors Debate Impact Of New Technologies On Dealers

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NEW YORK — In Part II of our Distributors Roundtable, leading A/V and IT distributors discuss the impact that new high profile technologies and product launches could have on retail sales this year.

TWICE:

What effect will 3D TV, mobile TV, e-book readers, iPad accessories and other exciting new categories have at retail?

Jeff Davis, senior sales VP, D&H Distributing:

It will be interesting to see how 3D plays out. The continued demonstration of the technology will be key to its adoption. As more 3D movies hit the theaters, the category will gain momentum. When the message gets out that consumers can enjoy that same 3D experience at home, the market will see a swell. Broadcast availability will also be a driving factor: The consumer will need content in order for 3D TV to be ready for widespread use.

In mobile TV there are a number of different formats in development, including free, paid and localized versions, and this influx could help drive adoption. We predict this will become a healthy category within a short period of time.

E-readers and the iPad will have an uphill battle against Kindle. However, the diversity of the iPad [and] slate computing will drive sales. Content capability and pricing will be the decisionmakers as to which formats thrive.

Stephen Bodnarchuk, national sales associate VP, M. Rothman and Co.

: The continued increased acceptance and mass market appeal of these products will be a nice shot in the arm for the consumer electronics industry.

E-readers and mobile TV have the potential for the greatest upside in the short term. The anticipated increased performance and lower price points of the next generation of these products will positively impact sales going forward. The larger install base for products such as e-readers and iPads will also once again lead to increased accessory sales and offerings.

3D TV generated great interest as it has the newness factor, but appears to be a little early with regard to actual sales and consumer acceptance. There are also still a lot of questions revolving around the format and the performance, not to mention the content.

Benjy Goldstein, CEO, Fesco Distributors:

3D TV is a great enhancement to home theater. It brings the real, life-like imagery that you would see in the movies to the comfort of your home. Some of the best reactions have been with children’s programming since this has such a huge “wow” factor. It will drive revenue, not just for the TV but for the BD players, and other content.

Warren Chaiken, president/COO, Almo:

Our feeling is that while exciting, none of these categories will drive huge revenues in retail this year. This is because all of these product categories are in the early adopter phase, particularly 3D TV. As a result, the impact will not be felt until they become more mass-market user-friendly.

Doretta Raffio, residential and commercial A/V senior product manager, ADI:

True 3D is still in an early-adopter phase, and consumers are considering 3D-ready products as an extra to the features they are already receiving. We will begin to see a real push for 3D TV once there are more consistent sources.

Jeff Kussard, strategic development director, Capitol Sales:

3D is getting tons of attention, but there is one aspect that has not been mentioned very often, even though it has relevance to our dealers. With 3D television comes the need for 3D glasses — replacements, upgrades, limited editions and so on. I can’t overstate the importance of add-on accessory sales to 3D TVs.

As far as iPads are concerned, we’re all optimistic that it will be Apple’s next great product, but I wouldn’t call it a slam dunk just yet.

Fred Towns, sales and marketing senior VP, New Age Electronics:

With 3D feature films increasing in popularity it’s no wonder that 3D TV is the latest “must have” technology with early adopters. Major television manufacturers began developing 3D home television technology in 2009 and although movie studios don’t really produce movies in 3D, consumers will be able to get a 3D experience from a 2D high-definition TV.

Executives and business travelers are paying close attention to the e-reader technology as it evolves. Although the electronic briefcase concept is very appealing, the e-readers of today, sized 8.5 by 11 inches, are more than what people want to carry. People are trying to figure out the best way to access content and whether there is really a need for it when the netbook and iPhone are satisfying business executives on the go.

Mark A. Gustavson, marketing and communications executive director, WYNIT:

3D TV may gain traction during the tax refund and “dads and grads” buying season, and the success of e-readers other than the Nook and Kindle will be driven by the growing availability of free, non-proprietary content.

The jury is still out on whether the iPad will generate demand for accessories at even a fraction of the levels of other “iLifestyle” products. Mobile TV looks promising, but its success will be determined by how consumers embrace mobile phone apps as opposed to an additional piece of hardware to carry around.

Bill Stewart, president/CEO, Petra Industries:

The great thing about our industry is that amazing innovations always provide new opportunities. All these categories will have a positive impact on our dealers.

With the major movie studios coming out with films in 3D, sports networks beginning to explore ways to record and broadcast in 3D, and manufacturers creating new and improved products every day, it’s only a matter of time before the demand begins to increase. However, like the adoption of HDTV, it might be a few years before it becomes common to find 3D in every household.

E-readers have such a huge potential for application in schools and leisure reading. Add functionality like Wi-Fi, a PDF reader, games and social networking like the iPad has, and Apple could be leading the way in how our children learn and our companies run in the future.

Our dealers need to be on the forefront of offering all of the accessories that go along with these products to be able to reap the benefits of these innovations.

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