The upcoming holiday season is looking a bit merrier, as the Consumer Electronics Association (CEA) sees evidence that the economy is picking up after few years. In its annual holiday survey, the CEA (www.ce.org) reports that U.S. consumers predict total household spending for the 2010 holidays will be $1,412, up 3 percent from last year. This is still not back to the golden days of the 2007, when household spending hit $1,671, but it’s a marked improvement over the horrendous 15 percent drop suffered in the 2008 season.
Even more optimistically for the consumer electronics industry, the allocation of holiday gift spending on electronics has continued to rise even through the bad years, and now is at 31 percent of the gifts portion of the holiday budget.
Retailers this year are broadening the excitement and discounts of “Black Friday” sales on the day after Thanksgiving. We now have “pre-Black Friday,” “every Friday is Black Friday,” and “any day is Black Friday,” themes, expanding to Black Friday weeks and even months. This special day keyed to a once uniquely American holiday also has gone worldwide, so you’ll find Black Friday overseas as well.
To help understand the products that are popular this year, the CEA survey also reports top 10 lists of specific product categories on the holiday wish lists. These are the electronics gifts that consumers say they would like to receive, so let’s look at why this gear could be intriguing for you as well.
Convergence and Change. The most dramatic change in this year’s wish list is the appearance of the iPad tablet as a new category, displacing netbooks after their appearance just last year. The iPad is joined by the iPod and iPhone as the only specifically branded products on the list, showing Apple’s continued strength in defining entire categories.
The other strong trend is the continued reversal of convergence, the idea that we would want to collapse all our different gadgets and functions into one uber-device. Instead of a super-smartphone that could go everywhere and do everything, consumers still want to carry separate devices for specific functions, starting with a portable laptop computer plus now an in-between tablet PC. And consumers still see the need for more focused devices including media players, E-readers, digital cameras, and GPS navigators.
Notebooks and the iPad Tablet. Notebook PCs continue to be No. 1 on the adult wish list, and No. 4 on the teens’ list. The portable PC has clearly won favor, with desktop PCs appearing only at the end of the wish list for adults.
Meanwhile, the netbook appeared on the list last year for the first time, but now is gone, as consumers apparently did not like the tradeoff of an inexpensive and lightweight PC that promised the full functionality of a notebook, but with underwhelming performance and all the associated PC support hassles.
This year sees the Apple iPad tablet explode in its first year to No. 2 on the adult list and No. 6 on the teen list. The CEA expects a flood of new announcements (for more than 50 products) at the Consumer Electronics Show in January.
The tablet promises the best of both worlds — the capabilities you want on a larger screen with the comfort of a smartphone operating system, but without the nagging anti-virus updates and pop-up warnings you get on a full PC. A tablet can make real sense for replacing a notebook for casual use, as it’s immediately accessible at home in any room. It also is easy to pull out on the go without worrying about setting up at a table or finding a power outlet.
The CEA reports that the top tablet activities for consumers can replace a computer, including browsing the Internet and reading E-mail (including attachments), followed by watching video, reading books and magazines, and gaming. Tablets also replace a media player or PDA for listening to music and keeping your calendar and contacts.
These activities are even easier with downloadable applications, including ones for browsing clips on YouTube, reading the New York Times, editing office documents, keeping up with Facebook, and even editing videos.
These devices are still heavy (the iPad is 1.5 pounds) and expensive (the iPad starts at $499 with Wi-Fi networking and 16 GB of memory; $629 for the Wi-Fi+3G model with the addition of a monthly cellular data plan so you can continue to access the Internet away from Wi-Fi hot spots).
You also need to live with the limitations of the somewhat closed system compared to a laptop. For example, the virtual keyboard on the screen that’s not great for extensive typing.
iPods and Media Players. Holding the top of the teen wish list yet again are portable media players and iPods. Apple still defines and dominates this category, as shown by the iPod having its own entry on both lists.
This year’s update to the iPod line further focused on portable music playing, with the display-less iPod shuffle (for $49 with 2 GB of storage) and the shrunken iPod nano with tiny touch display (starting at $149 with 8 GB). Both now feature clip-on designs for use with headsets.
Meanwhile, the iPod touch (starting at $229 with 8 GB) has become an almost full-fledged iPhone without the phone (or think of it as an iPad mini).
It has dual cameras and downloadable apps for web, E-mail, entertainment, and gaming. In comparison, the iPhone 4 is available from AT&T (with a service plan) starting at $199 with 16 GB of memory.
E-Readers. Another strong category for this year is E-readers. This is a great example of the counter-convergence story, as paper books are about the most convenient content delivery media you could imagine, and you already can read digital books on devices ranging from notebooks to smartphones to tablets.
But the electronic E-reader still makes great sense for people who just like to read. You can easily preview and download a huge variety of books and magazines from the associated bookstore (e.g., Amazon or Barnes & Noble), as well as public domain material (e.g., from Google Books), and audiobooks (e.g., from Audible.com). And you can download and view your own documents.
You also can access and read your E-book store purchases on other platforms, including PCs and smartphones and tablets with the associated apps. E-readers also add some limited convergence functions, including serving as a media player and even an (albeit limited) Internet browser. You can go online with built-in Wi-Fi to browse the bookstores, or some E-readers have built-in cellular data connections — and without any additional monthly service plans.
E-readers also are much less expensive than tablets: the Amazon Kindle starts at $149 for the Wi-Fi version, and $189 with 3G+Wi-Fi cellular, and the similarly sized Barnes & Noble Nook is $10 more, with the addition of a 3.5 inch color touchscreen navigation strip below the grayscale E-ink screen. Amazon also offers the larger Kindle DX with 9.7-inch screen and 3G+Wi-Fi for $379, and the new Nook Color with 7-inch color touchscreen is $249.
The advantage of E-readers versus multi-function tablets is again the focused design — these devices are lighter, thinner, and easier to hold comfortably for extended periods (the Apple iPad tablet with 9.7 inch diagonal display is four times the weight of the 6-inch Amazon Kindle (24 vs. 8.5 ounces), and the larger 9.7-inch Kindle DX is also lighter and significantly thinner than the iPad (19 ounces, and 1/3 vs. 1/2 inch thin).
In addition, the typically grayscale E-ink screens are crisper for extended reading, and easier to read outdoors, even in direct sunlight. The batteries also run for multiple weeks without wireless, or at least a week even with wireless running.
Video Games. Video game systems and accessories continue to be strong, appearing at No.3 on teen wish lists and No. 5 on adult lists. The Nintendo Wii has revitalized the console market by broadening the audience with casual games and sports activities. Kids can play with their parents, couples can play together, and retirees can get some fun exercise in the retirement home.
This holiday the gaming focus is on competing motion control systems with the Microsoft Xbox 360 Kinect and Sony PlayStation 3 Move systems. You can just move in front of the camera to control the action with gestures, for more accurate and realistic control of the game and your virtual character.
The Sony PlayStation Move adds a motion controller and associated camera to track your movements with the controller, to control the game or even bring a virtual character into the room with you. It’s available as a $99 accessory, or bundled with new PlayStation 3 systems.
The Microsoft Kinect uses a stereo camera system for controller-free gaming that does full-body tracking to follow gestures and your skeletal position, as well as providing face and voice recognition. It’s available as a $149 accessory, or bundled with new Xbox systems.
HD-TV and 3D. The CEA holiday wish lists show the success of the digital TV transition and the movement to high definition, as big screen TVs have lost some appeal. Similarly, the DVD player was No.6 in 2008, followed by the Blu-ray Disc player at No. 8 in 2009, and now is out of the top 10 for 2010.
In response, the consumer electronics industry is rolling out its next big step in technology — 3D TV. According to the CEA, 27 percent of U.S. adults saw a 3D movie in 2009, and so consumers are ready to also enjoy 3D in their homes. This year saw companies roll out entire lines of 3D HD-TVs, complete with the associated 3D glasses. Just add a 3D Blu-ray player and you can experience 3D movies in your own living room. (Unlike the deployment of high-definition, 3D is not being led by broadcasters and cable systems.)
Since adding 3D to TVs and Blu-ray players is not a major change (some Blu-ray players like the Sony PlayStation 3 can be upgraded in firmware), the technology likely will be built in as a standard part of more and more new products. Indeed, some TVs are already being sold as “3D ready” (i.e., buy the glasses separately).
The other continued push in TV is Internet integration, with web access and widgets built directly in to some TVs. Or you can add these features with set-top boxes like the Apple TV, Roku, and Google TV that provide access to a broad variety of streaming content beyond your cable system, including services like Netflix, as well as Internet sources including Hulu and YouTube.
Digital Cameras. The digital camera continues in the middle of the adult wish list, as in previous years. Yes, it’s trivial to shoot photos and videos with your cell phone or smartphone, and you even get the instant satisfaction of being able to text , E-mail, or upload your photos directly from the phone. But dedicated cameras provide clearly better pictures with higher-quality sensors and lenses, with extensive automated assists plus the option of manual controls.
Today’s cameras have plenty of resolution, so the focus is no longer on competing on the basis of raw megapixels. It’s now about more subtle details of the sensor quality and image processing, with features like automated face detection and exposure settings.
The other consideration is size and style. Do you want a camera that will fit in your pocket, or the higher quality and flexibility of a larger model, for example with a better lens that telescopes from the body? At the higher end you get more control, with a viewfinder (instead of just the back display) and interchangeable lenses.
So the SLR (single lens reflex), with the flip-up mirror between the viewfinder and sensor, evolved to the DSLR (digital SLR), and now is going to the “mirrorless” DSLR, with the same style of camera, but without the clunky mirror.
While digital cameras also shoot video, it also can make sense to have a dedicated video camcorder, particularly if you will be shooting for longer periods, or want more control of shooting features like zoom and mics. And simple pocket camcorders like the Cisco Flip make it easy to shoot spontaneous fun and more formal events, with great HD quality.
For high-end photographers, digital cameras are pushing back with the “hybrid” DSLR, explicitly designed to shoot HD video. These bring camera looks including interchangeable lenses and precise control over depth of field to video. And they let you shoot video less obtrusively than lugging around a camcorder.
Phones and Smartphones. So what about the ultimate convergence device? This year’s teen wish list adds smartphones at No. 8, the iPhone at No. 10, and cell phones at No. 5. The adult list does not have them at all this year.
The iPhone has defined the smartphone category, starting as an iPod phone and expanding to an app phone, but is now facing significant competition from Google Android, the RIM Blackberry for business, the reinvented Palm now part of HP, and Microsoft’s totally reborn Windows Phone 7.
This results in clear choices for consumers, depending on your needs and interests. In particular, Apple is echoing its long-time strategy on the desktop with the iPhone: premium products that inspire user fanaticism, with limited product models and tight control of the software environment for a consistent experience. In comparison, Android, like Windows, is available from a plethora of manufacturers, on a huge variety of models with different feature options (e.g., physical keyboard, larger screen, removable battery, removable memory cards), and with an open development environment for applications.
Yet even more than before, smartphones are living up to their promise as convergence devices, including nearly HD displays, multi-megapixel cameras, and GPS for live maps with directions. As a portable computer, you get full-up Internet browsing, E-mail, office document viewing and editing, and synchronized contacts and calendars.
As a media device, you also get streaming Internet music and video, and photo and audio and video recording, albums, and playback — plus new features like voice input and photo analysis, including text and bar code recognition. And downloadable apps further extend smartphones capabilities, including as an E-reader and handheld gaming system.
And, yes, these smartphones even do phone calls. This communications part is why it does make sense to off-load some of these tasks to other dedicated devices if you’re going to use them for an extended period, like GPS navigation for a long trip or shooting video of an entire event.
So whatever your needs this holiday season, the consumer electronics industry offers amazing products — converged or dedicated, for the home or on the go, large or small screen, pocketable or luggable, Wi-Fi or cellular. The choice is yours, whether you justify it as for personal entertainment or for business productivity — or both.