The word megatrends isn't listed in most dictionaries. But we usually know them when we see them, especially in the electronics industry. Predicting what technologies and issues are most likely to dominate the industry is a trick business. But it's the stuff CEOs, magazine editors, and market research organizations think about every day, particularly when it comes to the market and developing new products.
Or Anything Wireless
"Over the next several years, wireless with become massive in its pervasiveness," says Phil Asmundson, national managing partner for Deloitte & Touche US LLP's technology, Media & Telecommunications industry consulting practice.
"Wireless proliferation will impact virtually every aspect of our lives and will evolve well beyond mobile phones and PDAs to other devices, services, channels, and content," Asmundson says. At this connectivity becomes ubiquitous, we will face a range of threats and issues. But wireless will clearly change how we work, how we play, how we interact, how we learn, how we maintain our health, and, ultimately, how we live."
Where does that leave the Internet in the scheme of things? ComScore Networks conducted a survey in which it attempted to give a worldwide perspective on what it sees as a traditionally U.S.-centric Internet user measurement. It found that 152 million people in the United States and 22% of the world's population are Web users.
By contrast, just over 168 million users reside in four Asian countries—China, Japan, India, and Korea, or nearly 25% of the total online population. Worldwide, ComScore estimates 694 million people, age 15 and older, use the Internet. Those are pretty good numbers to hang a lot of applications on to.
Looking Ahead
The opportunities for new and emerging technologies, applications, and markets just keep growing. Consumers are spending at a rate that could easily surpass $125 billion this year. And the much-hyped digital home, pushed and prodded for years by the industry, home builders, and developers, may finally become a major trend.
At least 20% of broadband subscribers across the U.S. and Europe now use Wi-Fi to share their Internet connection between PCs and other devices, according to a survey by Strategy Analytics, a market research firm. The survey also reveals that 7% of all households now have a wireless network. In addition, U.S. sales of IP-enabled devices climbed by more than 500% in 2005, as consumers bought an estimated 16 million IP-enabled game consoles, entertainment PCs, and digital video recorders.
Consumer technology vendors who ignore the fundamental industry enabled devices will be left behind," says Peter King, home devices service at Strategy Analytics. King indicates that 7% of the digital consumer-electronics enabled in 2005 (Fig. 1). That's not a huge number, but it 2004, and he expects the trend to continue this year as add connectivity to flat-panel TVs, DVD players, digital-cell phones.
In another sign of the the strength within the consumer electronics sector, company Park Associates predicts that by 2010, worldwide-portable MP3 player shipments will total 106 million worldwide sales of portable multimedia players will jump to 21 million units.
The Federal Communications Commission-mandated deadline requiring analog to digital TV broadcasting is expected to create-S. pay TV providers. Millions of households served broadcasts are expected to finally sign up for multichannel-cable, satellite, and telecom companies by the February 2009 switch-off date.
Strategy Analytics expects the number of U.S. households using some form of digital TV to climb from 57 million today to 77 million by the end of 2008, just before the deadline. Moreover, penetration of digital service will grow from less than half of all cable customers today to nearly three-quarters by 2010.
The Consumer Electronics Association figures that 8.9 million HDTV sets were shipped last year, up from 6.1 million sets in 2004. As a result, CEA analysts estimate that 18 million to 19 million high-definition TV sets now sit in U.S. homes, about twice as many as a year ago.
This is very good news for chip manufacturers. Digital set-top box sales will boost both semiconductor unit sales and revenue, and total available markets (TAMs) will continue to increase at double-digit compound annual growth rates (CAGR). Semico Research forecasts the chip market to grow at a CAGR of 16.2% between 2004 and 2009, with units shipped increasing from 46 million to 97.4 million over the same period, largely on the back of consumer electronics.
The demand for digital living could finally drive the growth of home automation, some wired but most of it wireless, further extending the integration of portable devices into the home. Apple Computer is working with vendors so that consumers will be able to access Apple's iPod virtually anywhere in the home from home theaters. Eventually, consumers will have seamless access to information and personal entertainment from anywhere, inside or outside the home.
Forrester Research already sees this happening. At the end of 2005, 8% of U.S. households that already subscribe to mobile services dropped their landline phone service—up 3% from the end of 2004. Forrester projects that more users in the 35-44 age group will go completely wireless in the years to come.
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