The Last CES: Gadget fatigue forebodes industry consolidation

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 also: CES 2012: ZDNet’s news and analysis | CNET’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.