Shoppers will snatch up consumer electronics in droves this holiday season, but the small increase won't exactly shatter records. Market researcher IHS has dashed its high hopes of a 6.4 percent growth in CE revenue, adjusting its expectations to a much more modest 1.5 percent growth.
A poor economy and lackluster TV sales were cited as key factors for the group's revised forecast.
"Black Friday is prime time for consumer electronics manufacturers, when they can count on huge sales to achieve profitability for the entire year," said Jordan Selburn, principal analyst for consumer platforms at IHS. "However, as the year draws to a close, it's becoming apparent that sales in 2011 will fall well short of expectations, as economic issues take their toll."
Global CE revenue in 2010 hit nearly $351.9 billion, said the group, with the market expected to earn just over $357 billion this year. Selburn noted that the three-month holiday sales period would help considerably, but aren't enough to come close to last year's nearly 8 percent annual growth.
IHS found specific CE devices - LCD TVs and MP3 players - fared especially poorly, though for different reasons.
"While the LCD TV space is enduring a reduction in growth, the MP3 market is experiencing an accelerating fall in prospects, as the once ultra-hot systems are now being cast aside in favor of high-profile devices like smartphones and tablets," wrote Selburn.
To wit, the analyst revealed Apple shipped 2.5 million less iPods last quarter than it did the year prior. However, it's not all doom and gloom.
One bright spot is Blu-ray. Considerable across-the-board price drops on dedicated BD players in the past two years have helped the format immensely - growth expected to continue, said IHS. By 2015, the firm believes 80 million BD players will ship to retailers.
Sony's myriad price cuts to its game console/BD player PlayStation 3 have also paid off. A price cut this summer brought the system's price down to $250 and its sales up. (via IHS)
Plan on buying any new CE this holiday? Let us know in the comment section.
