The trouble with CES: too much electronics, not enough consumer

The trouble with CES: too much electronics, not enough consumer

Summary: What's the matter with CES? Part of the problem is that it hasn't really changed since 1981. Here's my analysis of what's wrong and what a truly competitive 21st Century show should offer.

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TOPICS: CES, Apple
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My colleague Jason Perlow is taking bets that CES will disappear by 2015. I think, in Vegas sports-book terms, that that's an even-money proposition. It's certainly not a good sign when the organization's Washington, D.C.-based Senior Vice President of Industry Affairs, a presumably well-paid executive with a staff of 40, shows up in my Talkback section to argue with my decision not to attend next year's show.

So what's the problem with CES?

The Consumer Electronics Association has put on the Consumer Electronics Show for decades. Of this I am sure, because I attended my first CES in 1979.

Back then, it was all about the gear. That word in the middle, electronics, accurately described what I remember seeing in aisle after aisle: TVs and car audio systems and amplifiers and monster hi-fi speakers and tape cassettes and laser discs and cables and connectors.

Those pieces of gear defined the experience. Bigger woofers, more watts, the more outputs the better.

And the show was also about distribution. Manufacturers had to find retail outlets for their gear, which had to be stocked and sold in brick-and-mortar stores.

I found this video clip, from a low-budget cable show, that accurately portrays what CES was like in 1981. It's like a time capsule of failed video formats. I've started the clip at about 3:17 in, where the host interviews a Sony representative who insists that the Beta format " has made a very strong comeback". (He also brags about Sony's arsenal of patents. Some things never change.)

Keep watching to see a demo of the truly craptastic RCA Selectavision player, which used grooved vinyl disks to play video:

(I actually had a review unit of that RCA player way back when. Frightening.)

The golden era of CES lasted until shortly after the turn of the century, when electronics began to get considerably simpler. It's no coincidence that Apple introduced the iPod right around that time.

The organization that runs CES hit the jackpot in 2004, when Comdex, the big computer trade show, suddenly folded. That gave computer manufacturers (many of whom were divisions of consumer electronics companies like Sony and Toshiba) a logical alternative. That sudden influx of exhibitors in turn gave CES a midlife kicker, which is only now beginning to fizzle.

The trouble with CES today is twofold:

First, all that hardware, the electronics, is only one piece in what has become a world of complex end-to-end experiences. You can't just buy a bunch of gear and hook it all together anymore to get a decent entertainment experience. You need software (an operating system and an apps ecosystem), services (which can be sabotaged by content owners), and network connectivity (which is under the control of cable and telephone companies and mobile carriers, who have business interests that are often out of alignment with their so-called partners).

Second, there's the retail chain, which is collapsing as businesses leverage the web to sell direct to consumers—or at least to cut out multiple layers of distribution.

Today, consumers can get most of the information about new gear from a company's website and from online reports. And if they choose to buy, they can do an end run around all those physical retailers and buy direct or from a large online retailer that doesn't have to stock inventory in a network of B&M stores.

This year, CES reported record attendance, its third up year in a row after hitting a disastrous low in 2009.

But I don't believe that upward trend will continue. Microsoft is pulling out of CES next year. Dell and HP and Acer, three of the world's largest PC makers, didn't have booths this year (HP had a small group of tables and some top execs at the independent ShowStoppers event). Amazon, which makes the phenomenally successful Kindle—a consumer electronics device if ever there was one—doesn't exhibit at CES. Apple has succeeded as a consumer electronics company despite never exhibiting at CES. [Update: A CES person points out that Apple Computer exhibited at CES long ago, most recently in 1994. But Apple the consumer electronics company, which removed the word Computer from its name years ago, has been conspicuously absent. The same spokesperson notes that Amazon had two meeting rooms this year. I don't consider those private meeting rooms, where the company was interviewing developers, to be "exhibits" in the sense that most people would use that word.]

Apple, Google, and Microsoft have developer focused events and product launches built around their own launch cycles, and many big companies have learned that staging launch events outside of the CES bubble is a better way to get publicity.

Frankly, CES is no longer a place where real innovation appears. Instead, it's become an aggregator of gadgets and hardware, with a smattering of other tech news in the mix. Its sheer size makes it economically worthwhile for sites like CNET and the Verge to send armies of correspondents to cover every device, no matter how small or repetitious. But don't mistake volume for news value.

I wish someone would step up and challenge CES with a new show that focuses on technology, the full ecosystem of hardware and software and services, instead of just gear. It would probably be smaller, but it could certainly be valuable.

And if they scheduled it in a charming city in May or September instead of the hellhole that is Vegas in January?

Hey, sign me up.

Topics: CES, Apple

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11 comments
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  • RE: The trouble with CES: too much electronics, not enough consumer

    [I]First, all that hardware, the electronics, is only one piece in what has become a world of complex end-to-end experiences. You can???t just buy a bunch of gear and hook it all together anymore to get a decent entertainment experience. You need software (an operating system and an apps ecosystem), services (which can be sabotaged by content owners), and network connectivity (which is under the control of cable and telephone companies and mobile carriers, who have business interests that are often out of alignment with their so-called partners.[/I]

    This I don't get. Why does every single tech device today need apps? Do people really need to be playing Angry Birds on their TV/Blu-Ray player? Do people really care about not having Words With Friends on their cameras?
    The one and only, Cylon Centurion
    • Perhaps not but those devices a Camera and Blu ray player

      @Cylon Centurion .... IN and of themselves don't generate interest and or need a show like CES. They are well toasters put them on the shelf like toasters and people will buy them without the need of a show.<br><br>Pagan jim
      James Quinn
    • RE: The trouble with CES: too much electronics, not enough consumer

      @Cylon Centurion Kind of like waaaaaaaaaaaaaaaay back in the '80's when they put small digital clocks on everything. (Ask your grandpa!) Thank goodness, the pet rock fad had died several years before or they would have put digital clocks on them as well.
      jayohem
  • RE: The trouble with CES: too much electronics, not enough consumer

    Sorry if this is a repost:
    How about also using CES as a way for Consumers (not exclusively Journalists and re-sellers) to provide feedback on what they want to see in Products. Although not timely enough for THIS year's electronics, it might provide an avenue for Consumers to provide feedback on what they might actually buy in the follow year(s) allowing companies to find out what tweaks/modifications users would like on current products (possibly in time for an update to be released) AND what they (companies) haven't thought of, but Consumers (i.e. the Customers) have thought of. Currently it seems consumers have to be satisfied with what Companies and Journalists/Bloggers/etc... have provided feedback on and decided.
    jkohut
  • RE: The trouble with CES: too much electronics, not enough consumer

    Ah, yes. SelectaVision. I looked at that one (I did not buy). Thanks for the memory.
    John Baxter
  • RE: The trouble with CES: too much electronics, not enough consumer

    I have to mostly agree with you Ed. The nature of consumer electronics have changed since the inception of CES. It makes no sense to have a January show to prep for potential products that fail to materialize in retail. Very few products are ready to ship in January & consumers aren't ready to buy new products. We need to make CES more relevant to the press & to audiences. What would make more sense?

    Two different shows.

    A much smaller Pre-CES show for businesses & retailers minus the press in June to discuss competed & ready to ship products. Then move the actual CES event in the last week of October when both retailers & manufacturers are ready to ship. Open this even not just to the press but open it to consumers. Make sales & pre-sales right on the CES showroom floor. Not only do you have products that will be on Black Friday? This will also create a way to engage customer interest ahead of Black Friday sales.
    Solid Jedi Knight
  • RE: The trouble with CES: too much electronics, not enough consumer

    Well Ed you miss the point of CES and what it's purpose is. Not surprising since they put the word consumer in the name. It is about showing off products to companies and not consumers. So maybe they should name it Company Electronics Show, they will not have to change the acronym
    mrlinux
    • RE: The trouble with CES: too much electronics, not enough consumer

      @mrlinux

      While I am not surprised that you had to call Ed out for what you think you know, I am surprised that you didn't just call him a Microsoft shill like most Linux fanatics would/do.
      hopp64
  • RE: The trouble with CES: too much electronics, not enough consumer

    The original Consumer Electronics Show was used by manufacturers to show and sell products to distributors and retail sales outlets. Secondarily, it was used by the same manufacturers to promote products to the media which would communicate to ... consumers. PR.

    Today it is PR only and very expensive, inconvenient and unpleasant at that.
    Airplane idiot
  • RE: The trouble with CES: too much electronics, not enough consumer

    From the article:
    "many big companies have learned that staging launch events outside of the CES bubble is a better way to get publicity

    HP - Staging their own marketing event made a world of difference for HP's TouchPad tablet. Oops! And WebOS was superior to Android. A lesson, perhaps? Not every company has a Steve Jobs at the helm.

    Apple - Steve Jobs was a master at staging marketing events for Apple's product and service launches. Thus, Apple's bypassing of CES. They did much better on their own. Even now without Steve Jobs. It's their shtick.

    Also from the article:
    "Amazon, which makes the phenomenally successful Kindle???a consumer electronics device if ever there was one???doesn???t exhibit at CES

    Have you ever noticed that you use a branded shopping cart or basket supplied by supermarkets while you shop for food? And that you get branded shopping bags upon checkout? These containers help customers carry purchased food items to the cash register as well as to their vehicles and, ultimately, their homes. Supermarkets are not in the shopping cart, basket and bag business. They contract with manufacturers to produce branded containers, presumably at a profit to the manufacturers, for use at their stores by their customers. These container items represent an expense to supermarkets, even the branded reusable shopping bags that are sold at a nominal cost. Supermarkets are in the retail food business. Shopping carts, baskets and bags merely make it easier for their customers to purchase food items in their stores. Would anyone expect Albertsons, Safeway, Trader Joe's or Whole Foods to display their branded containers at a trade show for shopping carts, baskets and shopping bags?

    Amazon contracted with the same manufacturer that produced RIM's PlayBook to produce their Kindle Fire tablet. A tablet that they sell to consumers at or near cost, an expense. The manufacturer of the Kindle Fire tablet, along with their suppliers, is in the consumer electronics business and, presumably, makes a profit on each device sold. As Amazon is an online retailer that also offers content services for books, music and movies, these tablets are merely vehicles for customers to make online purchases and use online services. They are analogous to shopping carts and shopping bags at supermarkets. And more directly analogous to branded reusable shopping bags purchased at a nominal cost.

    Amazon is not a consumer electronics company in the same sense as Samsung, HTC, Motorola Mobility, Apple and Nokia. These latter companies make the lion's share of their revenue through the sale of consumer electronics.
    Rabid Howler Monkey
  • RE: The trouble with CES: too much electronics, not enough consumer

    We lived in Las Vegas for four years while my husband was stationed at Nellis. You're right. January is the WORST month!
    MaryTN