The Last CES: Gadget fatigue forebodes industry consolidation

The Last CES: Gadget fatigue forebodes industry consolidation

Summary: I'm going to put a stick in the ground with this prediction: By 2015, the Consumer Electronics Show will be no more.

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TOPICS: Hardware, CXO, Mobility
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This week, a number of my industry colleagues are in Las Vegas covering CES, which for the past 45 years, has been an annual showcase of products from all aspects of the consumer electronics industry.

However, plenty of other folks have chosen not to attend, essentially because the show over the past several years has been victim of MOTSS (More Of The Same Stuff) syndrome. There are too many players showing too many of the same exact things.

Much of which looked exactly like the stuff they showed us the year before.

See alsoCES 2012: ZDNet’s news and analysisCNET’s news and product coverage

Many of us in the media are simply content to be on vendor email press release lists and will arrange calls by remote if something crosses our path that legitimately piques our interest.

But the honest truth is that few truly interesting and disruptive products are being shown, and quite frankly with the economy being what it is, the annual expo for the consumer electronics industry has reduced itself to a race to the bottom for many of what were once traditionally very strong brands.

These brands which used to focus on a handful of particular market segments have now have been forced to spread themselves thin over a wide range of product segments and with cheap, low quality products in order to cast as wide a net as possible in order to maintain exposure.

Essentially, there's too many vendors chasing an increasingly narrow customer base for a product category or group of product types that have become heavily commoditized and are victims of convergence, such as point and shoot cameras, camcorders and GPS devices that are becoming incorporated into other products like smartphones.

There's only so much attention you can actually get if you're hawking such a wide range of junk that nobody really has the money to buy, and there's nothing really distinctive about what you make versus what your competitors make.

If your value add isn't easily discernible from whatever else is being shown on that big convention floor, then as a consumer electronics company you've got big problems.

It doesn't matter if it's interactive TV sets, set top boxes, smartphones, tablet computers, notebooks or what have you. The consumer electronics industry has now matured to a point where the established market leaders exist for the products that they are known for, and everyone else is now just a "Me Too."

Thus the loss of focus, and too much of the same.

And typically, when a market becomes heavily saturated with similar products, social Darwinism comes into play. The strong survive and the weak will die. And this almost always results in industry consolidation. Which is never good for trade shows like CES.

To quote the central Eternal Recurrence philosophy of the Cylons and the Colonials from Battlestar Galactica, "All of this has happened before and all of this will happen again."

This foretelling of industry consolidation when things go into MOTSS has happened with big trade shows before. And it will happen again.

COMDEX and New York City's PC EXPO went the way of the dodo bird because only a few players remained after the computer and PC industry got smaller (in terms of number of companies in the Tier 1 and Tier 2) and the margins got razor-thin.

Loss of focus and dilution of exhibitors was the death knell of these shows, especially once the larger exhibitors found better ways to reach out to their customer base.

And I suspect this is exactly why Microsoft decided it was time for it to end its involvement with the show. Other large participants are sure to follow.

Heck, in 2011, AVN, the technology expo for the pornography industry, decided that it might be better if they went a week after CES instead of holding their show across the street during the same week.

When the porn industry scrambles away from CES's spillover business you know things aren't so great in Sin City.

Shows like COMPUTEX Taipei (which is focused heavily on Asia's ODMs and component/manufacturing base) and CeBIT and Interop will hang on a bit longer, since they have much more of a narrow focus and tend to have more of an enterprise and vertical IT slant.

But CES? I'm going to put a stick in the ground with a prediction that by 2015, the show will have entirely lost all relevance and will close its doors, just like COMDEX and PC EXPO before it.

Is CES doomed to follow COMDEX and PC EXPO into trade show oblivion? Talk Back and Let Me Know.

Topics: Hardware, CXO, Mobility

About

Jason Perlow, Sr. Technology Editor at ZDNet, is a technologist with over two decades of experience integrating large heterogeneous multi-vendor computing environments in Fortune 500 companies. Jason is currently a Partner Technology Strategist with Microsoft Corp. His expressed views do not necessarily represent those of his employer.

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  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    You are right, sir: too many gadgets that do the same thing and what is more, even when they were a novelty, those things they did were completely deprived of any utility. Just explain me for what a normal person need to "connect" to Internet in a bus or in a cab or in the loo.
    ferdinanvd@...
    • RE: The Last CES: Gadget fatigue forebodes industry consolidation

      @ferdinanvd@... Yes, and on top of that, the way technology news is distributed has changed drastically. When CES started, magazines were how most people got their technology news. The massive costs and lead times for magazine publishing made a one-stop technology show pretty useful and cost-effective. These days, people hear about new products the day they appear. In fact, a lot of us know about them long before they appear. CES is a holdover from a time when getting the word out about your products was a lot more difficult and costly. Apple and Microsoft have the right idea. Just go straight to your customers with product introductions at the moment they're ready, rather than waiting for some arbitrary show date. I'm not even sure CES will last until 2015.
      BillDem
    • RE: The Last CES: Gadget fatigue forebodes industry consolidation

      @ferdinanvd@... The best gadgets that I saw at ces is that one: http://www.technologyfazer.com/lenovo-k800-intel-with-intel-processor-smartphone.html
      nomikhokher
      • RE: The Last CES: Gadget fatigue forebodes industry consolidation

        @nomikhokher
        From the linked page "Another thing that there is no access to Android Market."

        I agree, this is the best gadget.
        ryanmc
    • You really don't think...

      @ferdinanvd@... some people may need to connect to the internet while in public?

      Come on. Just "think" a little more.
      godsfault
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    All shows eventually must come to an end; less victims of themselves and more victims of changes in the market they serve. Being boring is a crime and spending millions of dollars to shown your increasingly boring products at a show filled with lookalikes isn't interesting. In my experience, once a show encounters its natural limits nothing can revive it. I'd add the grand old NCC to your list,too, Jason.

    It's a lot easier to sit in my office and read about what's being announced/shown and then ask for more about the few interesting things than to trek to Las Vegas and brave the crowds. It's also much more productive.
    amywohl
  • It will happen before 2015

    Its boring and it restricts companies somewhat from when they intro new products. I think its why Apple jumped off the Macworld train too. I always wondered why have CES just after the holidays? Why not have it before the holidays? To spur on sales?
    When I look at what has been shown through the media on CES 2012. I find it more of what's already out there and pretty boring. I watched Microsoft's big opening and never finished it.
    jscott418-22447200638980614791982928182376
    • RE: The Last CES: Gadget fatigue forebodes industry consolidation

      @jscott418 It's after the Holidays because the devices being showcased are limited quantities of NEXT YEARS MODEL!!! They won't be ready for shipment for at least 6 months.

      It's precisely because it's just after the Holidays that they want the store buyers (who are the only people who matter at CES) to see their wares and place advanced orders.

      Pundits, Reporters, Technogeeks and other attendees like them are just the detritus of the industry. For what CES is intended to be, it will go on just fine if Jason and his peers don't go. But, the stores will continue to go and try to figure what they want to actually buy. Often the buyers want to be able to actually try the devices before they order $30,000,000.00 worth. Given the scope of the orders, that is why there is so much swag there.

      CES won't end, but the general public attendance just might.

      Microsoft and Apple are not going because they are not a good fit for that show. Apple because it isn't for general sales. Microsoft on the other hand is a software vendor primarily. It's niche is computers and video games. Only a small subset of the offerings that CES is looking at.

      Their attendance is not required for the success of the show.
      YetAnotherBob
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    This is funny. CES is a TRADE SHOW! Its become fashionable amongst gadget obsessed people and the bloggers that feed them, but in reality, its a showcase for retailers that buy stock and vendors that sell them. All trade show are.

    Every industry has and needs trade shows. I dont see what the problem is?
    ofoedu@...
    • Smaller numbers of larger buyers

      I think the problem is the consolidation of distribution. Today a handful of purchasing agents at WalMart/Sams, Amazon, Costco, BestBuy, Fry's, etc., represent 90% or more of the retail distribution of consumer electronics. The old days when every city had two or three "TV and appliance" stores, two or three "car stereo" stores, some upscale audiophile stores -- all of them locally owned -- are gone. So the whole purpose of having a trade show has pretty much disspated. The 'little guys' are still out there, but they're so little that it's not worth your trouble to go to Las Vegas and put up a booth and pull your sales force out of the field for a week to go see them.
      Robert Hahn
      • RE: The Last CES: Gadget fatigue forebodes industry consolidation

        @Robert Hahn I agree. Especially when we have the greatest advertising machine ever developed right at our fingertips, and you're staring at it right now. The internet.

        Every single individual with an investment in technology sales can even (to a certain degree of course) compete with giants like the actual chain stores such as Best Buy, Fry's Electronics, or even Staples. Just as an example, we can see Newegg and Tiger Direct to be prime for that.

        The internet IS the CES of today. The actual show is nothing more than a hold out and a presentation showcase for large companies, who in reality would be better off investing the money they'd spend to present there figuring out how to put real value back in their niche products.
        Tora1337
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    Great post and really says it all. Plus with Microsoft announcing they would stop doing CES I knew it was doomed. CES doesn't have many years left. While CES will be gone, some other new show will take its place for the next 10 years and it too will go and be replaced by something else.
    Loverock Davidson-
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    What? There was a CES?
    mveljkov@...
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    Sounds like the authors are getting jaded. Why not point out this is the best time ever for consumer electronic devices. We're all walking around with near super-computers in our pockets with gigabytes of storage that are receving signals from a constellation of satellites along with data from high-speed internet connected networks for god's sake! Would you rather have a Sony walkman from 1980? Sheesh.
    msides@...
    • RE: The Last CES: Gadget fatigue forebodes industry consolidation

      @msides@...

      I agree that many tech writers have become jaded about technology itself. They have so much now that they just can't get excited about anything anymore. Even stuff that is exciting for the consumer the tech writers are very blase about.

      When you live and breath something for years, or decades, you can become jaded. That doesn't mean that the very people you're writing for aren't excited about the stuff you're saying is "more of the same".
      Ididar
      • RE: The Last CES: Gadget fatigue forebodes industry consolidation

        @Ididar While I agree with you, and msides, I will have to say that if you do quick searches, we find that it really is more of the same. The iphone has gained greater processing power and more memory, more storage even, the ipod has gone touch, and androids are everywhere. We carry cylons in our pockets... But when it comes down to it, it really is all the same when you break it down to its base components. They are all portable communications devices with largely the same functionality and nothing truly differentiates one from the other, save some exclusivity or price points, and that's not a value add, honestly.

        I'm not even in the tech-industry (Graphic Design) and I can see it. However, I will say that we do live in a wondrous time for technology, and it astounds me how far we've come since just 1984 when the first cell-phones hit the market. Or somewhere around then.

        But ultimately, if you want to get excited, all you have to do is surf the net for new tech, the point of the article is there really is no need to go all the way to Las Vegas to see a show about gadgets you've already seen. Simply put, just because the people they write for are excited about it, doesn't make it any less 'more of the same stuff'.
        Tora1337
    • RE: The Last CES: Gadget fatigue forebodes industry consolidation

      @msides@...
      Isn't that sort of the problem though, we've finally gotten devices that are on the scale that the words "need" and "upgrade" no longer have anything to do with each other. There's really nothing flashy they can show at a show, because the folks wandering around are muttering to themselves, "he, that's neat, but my phone/tablet did that last year too."
      rwwff
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    As consumers we are over-saturated with "new" products, that indeed do the same thing. Many of these products are made because they can be. They do not add value to my personal or professional life.
    djsullik
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    You're so right on!! Spot on, as the Brits put it. I said this very same thing 3 years ago at the last CES I attended mainly due to the repetitiveness of products offering very little in the way of inovation and leaps forward technologically.
    tsete7@...
  • RE: The Last CES: Gadget fatigue forebodes industry consolidation

    Having attended more than 30 CES shows during the 80's and early 90's, back when there was both a vibrant annual Las Vegas winter CES and Chicago summer CES, it is with some nostalgic sadness I read this article. Back then, consumer audio and video products were the mainstay of the shows, but as that market matured and declined, as the author points out, they scrambled to fill the booths with all sorts of cheap electronic gadgets and trinkets making the retailer's trek a less productive and cost effective way to do business. One thing not mentioned to any degree is the fact the the exhibitor's costs have also risen dramatically for staff acomodations, exhibit space, along with exhibit hall move-in and support staff. When you are forced to hire union electricians to do something as simple as plugging in your display products, it gets awfully expensive.
    MBRIANT@...