Global pc electronics

Global Consumer Electronics:

Trends, Developments and Insights

June 2009

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© Euromonitor International >Consumer Electronics-Trends

Scope

Global Performance

Regional Trends

Regional Market Insights

Global Consumer Electronics Trends

Channel Analysis

Category Analysis

Competitive Landscape

Future Trends and Developments

http://www.euromonitor.com/

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This presentation on the world market for consumer electronics covers the following products:

Scope

Scope

*duplicate (desktops and laptops under computers are also included within personal computers and portable computers, respectively)

Disclaimer

Much of the information in this presentation is of a statistical nature and, while every attempt has been made to ensure accuracy

and reliability, Euromonitor International cannot be held responsible for omissions or errors

Figures in tables and analyses are calculated from unrounded data and may not sum

2008 Global Consumer Electronics

2.7 billion units

In-home

1.2 billion units

Televisions and Projectors

VCRs and DVD Players

TV and VCR/DVD Combinations

Home Audio and Cinema

Personal Computers

Portable

1.4 billion units

Cameras

Camcorders

Portable Media players

Mobile phones

Portable computers

In-car

144 million units

In-car media players

In-car speakers

Navigation systems

Other in-car electronics

Computers*192 million units

Desktops

Laptops


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Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




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© Euromonitor International >Consumer Electronics-TrendsGlobal Performance

Volume Performance

Volume sales for in-home consumer electronics were

highest in the Asia-Pacific region. At the end of the

review period, the region accounted for more than

44% of overall global volume sales.

Global volume sales of in-car consumer electronics

reached more than 144 million units in 2008,

reflecting robust demand in China (28% of total

sales), USA (17.4%), Japan (8.4%) and Germany

(6%).

Global volume sales for computers grew to nearly

193 million units in 2008, with heaviest sales (32%)

coming from the Asia-Pacific region.

Volume sales of consumer electronics products grew at

a CAGR of 11.3% between 2003 and 2008, reaching

2.7 billion units in 2008. Over the same period, value

sales increased at a CAGR of nearly 14%, reaching

more than US$739 billion in 2008.

Overall CE volume sales were boosted by strong sales

of portable consumer electronics and the increasing

popularity of miniaturization.

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CE Market in Volume (2003-2008)

Total Volume Volume Growth 41.6%

46.8%

4.9%

6.6%

2008 Volume Share by Sector

In-home consumer electronics

Portable consumer electronics

In-car consumer electronics (aftermarket)

Computers


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© Euromonitor International >Consumer Electronics-TrendsGlobal Performance

Value Performance

Regions with strong contributions to value sales

performance included Eastern Europe, Latin America,

Asia Pacific and Australasia. Growth sectors like mobile

phones, multimedia players and in-car consumer

electronics bolstered market performances in those

areas.

In-home consumer electronics was the best performer

with nearly 48% of global value sales in 2008. This

performance, however, represented a sales decrease

from prior year due mainly to declining unit prices of

major in-home consumer electronic products.

Countries with strong value sales growth during the

review period included Argentina (47% CAGR) for in-

home products, Poland (28% CAGR) for portable

products and South Africa (64% CAGR) for in-car

products.

While the global financial crisis did not affect overall value

performance in the sector in 2008, future performance is

uncertain as, inevitably, product distributors will be forced

to reduce unit prices in order to continue attracting

customers.

Consumer demand for sophisticated, compact and well-

designed products always drove sales in the global CE

market. Due to market setbacks, however, many

households are showing a degree of cautiousness and

many consumers are beginning to seek out the best

value for their money.

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CE Market in Value(2003-2008)

Total Value Value Growth

10.3

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Consumer Electronics CAGR Value Performance


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Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




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© Euromonitor International >Consumer Electronics-TrendsRegional Trends

Western Europe

Austria2% Belgium

2%

France14%

Germany18%

Greece2%

Italy10%

Nether-lands4%

Portugal2%

Spain10%

Sweden2%

Turkey4%

United Kingdom

20%

Others10%

Western Europe Volume Share (2008)

Volume sales in Western Europe grew at a CAGR of 7.2% over

the review period, reaching 530 million units in 2008.

United Kingdom made the biggest contribution to the region‟s

volume sales in 2008 with nearly 20% of the total. This was

followed closely by Germany with 18.3%.

Portable consumer electronics turned out to be the most

significant sector in the regional CE market. In 2008, volume

sales reached more than 280 million units, accounting for nearly

53% of overall volume sales in Western Europe.

2008 Highest Performing

Electronic Products in

Western Europe (volume)

% Share

Mobile phones 29.3

Personal computers 15.6

Televisions and

projectors12.7

Computer peripherals 12.4

Portable media

players9.5

There is increased demand

among Western European

consumers for portable

consumer electronics products

such as portable computers,

media players and mobile

phones. Mobile phones

emerged as the best-

performing product in terms of

volume sales with more than

155 million units sold in 2008.

Value sales in the Western

European consumer

electronics market reached

more than US$200 billion in

2008, reflecting a CAGR of

nearly 13% over the review

period.

France recorded the highest value sales with

US$37.4 billion, representing growth of more

than 25% over prior year. The impressive

performance was due in large part to sales of

high-priced televisions and projectors.


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Eastern Europe

Volume sales of consumer electronics in Eastern Europe

reached nearly 170 million units in 2008, representing a CAGR

of 16.2% during the review period.

Russia contributed the most to volume sales with nearly 82

million units sold in 2008. Russia was followed by Poland,

Romania and Hungary.

More than 55% of overall volume sales of consumer electronics

products in Eastern Europe came from the portable consumer

electronics sector in 2008.

Value sales in Eastern Europe reached more than US$46 billion

in 2008. Between 2003 and 2008, value sales grew at a CAGR

of nearly 25%.Hungary

6%

Poland19%

Romania8%

Russia48%

Others19%

2008 Eastern European Countries (volume share)

Mobile phones was the most significant consumer

electronics subsector in Eastern Europe in 2008. Mobile

phones represented 70% of overall volume sales of

portable electronics and nearly 50% of total portable value

sales.

Value sales for laptops reached more than US$6.2 billion

in Eastern Europe in 2008, followed closely by value sales

for desktops which came in at nearly US$5.7billion.

One factor influencing purchasing behaviour in Eastern

Europe is that CE products are regularly on sale not only

in specialist shops but also in consumer electronics

supermarkets. Overall declining unit prices also play an

important role in driving volume sales. .

2008 Top 10 Electronic Products in E Europe

% volume share

1 Mobile Phones 26.2

2 Laptops 13.5

3 Desktops 12.3

4 Digital TVs 9.9

5 HDTV (High Definition TV) 7.6

6 Computer peripherals 7.1

7 Digital cameras 5.7

8 Monitors 4.9

9 Digital camcorders 3.0

10 Portable media players 3.0


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North America

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2008 North America Volume Shares

Canada Volume USA Volume

Canada growth rate USA growth rate

Volume sales of CE products in North America reached

more than 515 million units in 2008, representing a

CAGR of just over 7% during the review period. Of that

2008 total, nearly 474 million units (92%) were sold in

the United States.

Value sales grew at a CAGR of 8.2% between 2003

and 2008, reaching US$147.3 billion in 2008. In the

US, value sales reached US$135 billion in 2008, a

slight decline over prior year.

Sales of digital electronics continued to dominate the

North American flat-panel market in 2008. Lower prices

and the wider range of screen sizes were among the

key factors spurring consumer demand for HDTVs.

2008 Top 10 Electronic Products

in North America

% volume share

1 HDTV (High Definition TV) 20.6

2 Mobile phones 18.5

3 Laptops 15.6


5 Desktops 6.2


7 Monitors 5.0

8 Portable multimedia players 3.6

9 Printers 3.1

10 Navigation systems 2.8

Increased demand among busy consumers for portability drove

sales of mobile phones and laptops, positioning them as the

second and third hottest products (in terms of value sales) in

the North American consumer electronics market.

Depending on the severity of the recession and the possibility

of unexpected oil price spikes, the consumer electronics sector

in the region could face a bumpy road in the short term. At the

same time, the long-term economic outlook for the region is

risky due to high trade and budget deficits, historically low

household savings rates and mounting consumer debt, all of

which are expected to begin to affect performance in the sector.


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Volume sales for consumer electronics in Latin America reached

almost 202 million units in 2008, representing a CAGR of 14.8%

CAGR during the review period. Brazil emerged as the dominant

market, accounting for almost 47% of total Latin American

volume sales. Value sales reached US$64.5 billion in 2008.

Portable consumer electronics was the most dynamic CE

sector, recording volume sales growth of 18% in 2008. Mobile

phones dominated this sector, accounting for more than 78%

volume sales.

Personal computers was the leader in the in-home CE sector in

2008, accounting for 55% of total volume sales. Televisions and

projectors ranked second, accounting for nearly 21% of volume

sales..

Almost 79% of the portable consumer electronics sold in Latin

America were mobile phones, an indication of the popularity of

communicating on-the-go.

In-car media players was the leading subsector in the

Latin American in-car consumer electronics

subsector in 2008 with just over 59% of total volume

sales. In contrast to the dwindling popularity of in-car

CD players in markets like North America, in Latin

America these products continued to show

remarkable growth with volume sales increasing at a

CAGR of 18.4% during the review period. Demand

for in-car CD players was particularly high in Brazil.

Regional Trends

Latin America

Argentina13%

Brazil47%

Chile5%

Mexico17%

Others18%

2008 Latin America Volume Share

95.1 100.3

6.416.7

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2008 Latin America Consumer Electronics Volume Sales


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High Definition TVs (HDTVs) were one of the most

dynamic products in the in-home CE market in the Asia-

Pacific region. Volume sales of HDTVs grew at a CAGR

of more than 185% during the review period.

Portable media players showed robust sales

performance thanks to the popularity of mobile phones,

which raked in value sales of more than US$67 billion in

2008.

Strong sales of laptops and digital cameras reflected

the growing popularity of portability in the region.

Volume sales of consumer electronics in Asia-Pacific

reached more than 1.13 billion units in 2008,

representing a CAGR of more than 14% during the

review period. China emerged as the biggest market in

volume terms with 49% of the region‟s total volume

sales in 2008.

Value sales of consumer electronics products grew at a

CAGR of nearly 15% during the review period, reaching

more than US$232 billion in 2008.

In-home consumer electronics was the largest sector

accounting for 47% of total volume sales in 2008.

However, it‟s expected that portable consumer

electronics will replace in-home CE in the top position by

the end of 2009.

Regional Trends

Asia Pacific

China49%

India17%

Japan13%

Malaysia1%

South Korea

5%

Taiwan2%

Rest of Asia Pacific

13%

2008 Asia Pacific Volume Share

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Asia Pacific CE Value Sales

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Volume sales for consumer electronics in Australasia

reached more than 44 million units in 2008,

representing a CAGR of 10% between the 2003 and

2008. Portable consumer electronics emerged with the

highest volume sales in the sector with 47% of the total

in 2008. Value sales reached over US$14 billion in

2008.

In terms of value sales, HDTV was the best performer in

the in-home consumer electronics sector with sales of

nearly US$597 million in 2008. The demand for high

definition television coincides with the need for

consumers to replace their analogue TVs in preparation

for the shift to digital broadcasting in the region.

Sales of desktops continued to increase, reaching

volume sales of more than 2.2 million units and nearly

US$2.3 billion in 2008.

Portable CE products were the most popular among

consumers in Australasia. Mobile phones, laptops and

digital cameras continued to show consistent growth.

Consumers are demanding devices that enable them to

access whatever content they want, when they want it.

Portable computers, portable media players and devices

like personal video recorders (PVR) and Internet

Protocol TV (IPTV) are experiencing strong growth and

generating a great deal of consumer interest in

Australasia.

Consumers showed high interest in converged

electronics products as they address a number of

household and professional needs.

Regional Trends

Australasia

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2008 Australasia Market Performance

Volume Value

2008 Top 10 Electronic Products in Australasia

% value share


2 Desktops 16.2

3 Laptops 13.4



6 Printers 4.8

7 Monitors 4.3

8 HDTV (High Definition Television) 4.2

9 Portable media players 3.4

10 Projectors 2.9


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During the review period, value sales of consumer

electronics products in Middle East and Africa market

grew at a CAGR of 13.6%, reaching more than US$34.8

billion in 2008. Sales of portable consumer electronics

were the primary driver of growth, accounting for more

than 50% of value sales in 2008.

Over the same period, volume sales grew at a CAGR of

15.5%, reaching nearly 130 million units in 2008.

Volume sales of portable consumer electronics products

reached nearly 68 million units in 2008.

In the in-home consumer electronics sector, televisions

and projectors were the best performers with volume

sales of nearly 14 million units in 2008. Demand for high

definition television is slowly increasing among

consumers who are seeking to replace their analogue

products with digital formats. Among portable consumer electronics products, mobile

phones were the market leaders with more than 54 million

units sold in 2008. This represented a CAGR of 26.4%

between 2003 and 2008. Consumers in the Middle East

and Africa are increasingly demanding fashionable mobile

phones with high mobile content capabilities.

Consumers in the Middle East and Africa bought more

desktops than laptops in 2008. Desktops accounted for

nearly 56% of overall computer volume sales.

Sales of in-car speakers led the in-car consumer

electronics sector. In 2008, in-car speakers generated

sales of US$142.5 million.

Regional Trends

Middle East and Africa

Top Performing Electronic Products in Middle East

and Africa 2003-2008 (volume)2003-2008

CAGR

1 Projectors 32.5


3 Digital TVs 25.2

4 Printers 24.9

5 Portable multimedia players 21.3

6 HDTV (High Definition Television) 21.2

7 Laptops 21.1

8 Hand-held televisions 20.8

9 Converters, decoders and receivers 17.7


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2008 Middle East and Africa Market Performance

Volume Value


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Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




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The 19% decline in the consumer confidence index in

Western Europe in 2008 was a response to the onset

of the global economic downturn. Sales of expensive

products like in-home audio/video products and other

products related to entertainment will be the hardest hit

over the forecast period as consumers begin to rein in

their spending on non-essential items.

In the wake of the current credit crisis, banks in the UK

have implemented stricter rules regarding the provision

of consumer credit, resulting in a decline in automobile

sales. In turn, sales performance in the in-car

consumer electronics subsectors will be affected.

High prices of in-home consumer electronics products,

combined with the current high levels of personal debt,

slowed sales growth in the subsector. In contrast,

sales in the portable consumer electronics subsectors

remained relatively buoyant in Western Europe as

consumers continued to demand products that

informed and entertained them on-the-go. Spaniards are increasingly moving to single-family

houses located on the outskirts of major cities. The

average commuting time spent going to and coming

home from work (whether by public transport or by

private car) has increased considerably, driving

demand for portable media players and in-car media

players.


Western Europe

With fewer children, Italians tend to have more disposable income to spend on consumer goods in general and on consumer electronics in particular, especially in-home products.

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Consumer Confidence Index in Europe January 2008 – January 2009

Germany France UK Eurozone


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The consumer electronics market in Eastern

Europe has been characterised by mergers among

major market players and the development of

franchises, resulting in more diversified product

ranges and in companies expanding into the

Russian market to increase their market shares.

Eastern European countries face the continuing prospect

of declining populations, declining birth rates, increased

death rates and negative net migration, all factors that are

expected to contribute to a negative impact on demand for

consumer electronic products.

FDI into Eastern Europe and CIS countries declined in

2008-2009, exacerbating unemployment rates in countries

like Bosnia, Ukraine and Kazakhstan, among others. This,

in turn, has led to a further decline in consumer

confidence, forcing many Eastern Europeans to focus on

priority expenditures rather than on consumer electronic

products.

A number of financial institutions in countries like Estonia,

Ukraine, Croatia and Latvia have been directly affected by

the US sub-prime mortgage crisis. CE companies linked

to these banks have had to consolidate unprofitable

channels and review existing product lines in order to

sustain profitable economies of scale.


Eastern Europe

“Grey” market activities are affecting the manufacturing of consumer electronics in Eastern European countries. Illegal market operators offer very low prices that domestic producers cannot match. Multinational companies that have built factories in Eastern Europe also feel the influence of the illegal market, particularly in sales of portable CE products.

Population

Decline

Decreasing

Foreign Direct

Investments

Shrinking CE

Market

Opportunities

Increasing

unemployment

Unstable

financial

institutions


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As a result of the credit crisis, access to consumer credit

declined as banks tightened lending requirements. As a

consequence, the number of consumers who can borrow

to buy homes has decreased, and this has led to lower

demand for in-home consumer electronics products.

The slowdown in the US housing sector led to large

increases in unemployment in 2008, and this is expected

to continue into 2009. This situation has contributed

greatly to the decline in consumer confidence and, in turn,

it is expected to have a negative impact on consumer

expenditure on durable goods and consumer electronic

products.

American Baby Boomers (those born between 1947 and

1966), considered to be the wealthiest generation, are

now approaching retirement. Their past interest in

consumer electronics is likely to decline as they pursue

other interests.

The growth of private label products in North America

changed the relationship between the larger retailers

and their supply base. When Best Buy and Wal-Mart

expanded their private label offerings, their influence

over suppliers increased. Power within the supply chain

gradually shifted from traditional original equipment

manufacturers (OEM) to electronics manufacturing

services (EMS) providers and original design

manufacturers (ODM), who work directly with retailers to

develop private labels.


North America

The Generation Y demographic in North America (those now between the ages 13 and 31) has emerged as an important driver of consumer electronics sales. This group represents varying life stages, and thus they seek a diverse range of consumer electronics products. Regardless, as a group their main focus has been on portable electronics, such as mobile phones and MP3 players.

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Sales of Exisiting Houses in the US January 2008 – January 2009


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Falling remittances from Latin American workers in the USA

had an impact on consumer spending in their home countries.

Remittances are a crucial source of funding for many in Latin

America. In particular, they often bolster household purchases

of consumer electronics products in the region.

Consumer demographics in Latin America are changing. The

increase in female employment has contributed to income

growth in many households, and this has resulted in more

disposable income being used to buy luxury items. Women

consumers are driving demand for portable laptops, mobile

phones and MP3 players with stylish designs.

The recession and the global concern regarding the mounting

difficulties in the world financial markets has affected Latin

American consumers. Many take more time to consider what

are now important spending decisions, and this puts many

consumer sectors at risk. The consumer electronics sector,

however, may avoid this, as most of the products they offer

deliver entertainment, communication or information, services

that often allow consumers to escape the discomfort of

uncertain and difficult times.


Latin America

Fashion and technology have combined to become a powerful force in driving the introduction of new consumer electronics products in Latin America.

Strong growth in credit cards, particularly

store credit cards, is shaping the Latin

American retail market. The financial

sector has government support in this

effort as using financial instruments helps

reduce the need and expense of printing

money.

Overseas remittances

and FDI

Product export

(services and raw

materials)


20


Economic growth in the Asia-Pacific region has turned

lethargic as a result of the global economic slowdown.

China's stock exchange lost more than 47% of its value

in 2008 due to concerns about declining export

demands and slower growth. This led to more caution

among consumer electronics manufacturers, many of

which considered postponing research and development

efforts (and costs) in order to focus on more pressing

business ventures.

An export-oriented economy, Japan has been

particularly affected by the global economic slowdown,

resulting in a decline of 12.1% in annual real GDP

growth in the fourth quarter of 2008. This drop caused

alarm among market players in Japan. Several

companies with global market presences in the

consumer electronics sector sought to redirect efforts

towards reviewing existing marketing strategies to

sustain economies of scale..

Demand from „tween‟ (preteen) and teenage population

groups in the Asia- Pacific region tend to influence the

direction of marketing and product development efforts

undertaken by major consumer electronics players.

Demand from consumers in the region is polarized

between premium products, which provide an edge in

computing and technology, and mass-based products

that cater to the lower end of market.


Asia Pacific

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Asia Pacific Equity Index Losses:July 2007 - December 2008

% decline

Source: 2009 Euromonitor from Bloomberg

In most countries in the Asia-Pacific region, economies are primarily cash-based. This provides growth opportunities for mobile payment support structures which could, in turn, drive increased demand for more sophisticated mobile phones.


21


While overall expenditure has been softening, anticipated strong employment figures may support increased

consumption. Labour markets in the region remain tight and job losses are still anticipated, but they are

expected to be low compared to other regions, which bodes well for the consumer electronics sector over the

forecast period.

Australasia is in a better position to weather

the global financial crisis than other

developed regions. Labour markets are

tighter there than in Europe and the USA,

and the region‟s main trading partners,

countries in the Asia-Pacific region, still

expect growth in 2009.This has bolstered

confidence among major consumer

electronics players operating in the region, all

of whom intend on continuing to provide

consumers with more formidable products

borne out of more confident marketing,

research and technology.

Many Australians perceive urban lifestyles to

be increasingly uncomfortable, and many

have decided to move to more affordable and

less stressful locations. Large population

shifts like these often drive new purchases

and replacement purchases of consumer

electronic products.


Australasia

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Employment Population in Australasia (2003-2008)

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Due to their relative insulation from the world's

financial system, countries in the

Middle East (except for UAE) and in Africa have

been among those least affected by current global

financial crisis. Because of this, major global

consumer electronics players are planning launches

in the region to offset losses from underperforming

flagship products in other markets.

Demographic features evident in most countries in

the region include rapid population growth and a

high proportion of young people in the total

population. The Africa and Middle East region has

the youngest population among all of the world's

regions, and this is a sales opportunity, particularly

for portable CE products. Demand for laptops,

mobile phones and portable multimedia players has

increased.



Many parts of Africa lack political security, and this has scared off many major consumer electronics players from entering markets in the region. There are a number of “conflict situations” and domestic and cross-border disputes, with the situation in Darfur, Sudan being the best known. Political turmoil threatens economic progress in Chad, Côte d'Ivoire, Eritrea, Ethiopia, Guinea, Lesotho, the Seychelles, Somalia and Zimbabwe, and this has had an effect on the consumer electronics markets in these countries.

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Consumer Confidence in Selected Economies: 2006-2008

South Africa Saudi Arabia UAE Egypt

Source: Mastercard


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Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




24

© Euromonitor International >Consumer Electronics-TrendsGlobal Consumer ElectronicsTrends

Western Europe: Hi-tech and Green

As of March 2008, all manufacturers are required by the

French government to offer only digital TVs. As an EU

member, Greece is required to shift to digital

broadcasting by 2012.

Energy-saving and non-toxic products drove sales in

Germany as concerns about global climate change

heated up. “The Green Grid” initiative was introduced

by processor company AMD and it clients HP, IBM and

Sun.

The introduction of flat-screen digital TV in Belgium

drove increased sales of decoders that allowed

consumers to adapt to digital TV at lower prices. Spain

followed suit with the introduction of HDTV.

In Italy, mobile phones (3G handsets) drove sales the

consumer electronics market, especially handsets with

clamshell shapes, black design, high-resolution

cameras, MP3 players and Bluetooth connectivity. In

the UK, iPhones continued to see increased sales.


25


Eastern Europe: Go Digital

Poland intends to produce approximately 38 million TVs

for the European market by 2010 in factories in Nowa

Sola, Wroclaw, and Kobierzyce. With a focus on LCD

technology, industry analysts claim Poland can be the

„the counterpart of China‟ in Europe.

Left Inset: A Toshiba production plant in Kobierzyce

Photo courtesy of Toshiba Corp

Sales of in-car DVD players strengthened

the overall in-car consumer electronics

market in Romania.

Home theatre in a box (HTiB) continues to drive

sales in the overall home cinema and speaker

systems sector in Russia.


26


North America: Advancing Technology

Private label brands in North America are expanding

into portable consumer electronics. Wal-Mart offers

multimedia players under its iLO and Siren brands while

Best Buy offers its low-priced DVD and MP3 players

under its Insignia brand.

The availability of high-speed networks such as

3G (and potentially 4G) provides American

consumers with the ability to stream video and

access other advanced wireless features via

their mobile phones.

Canadians increasingly replace their old CRT

computer monitors with new LCD screens.

4G Samsung P9000


27


Latin America: Looking for Cheaper Alternatives

Flash drive memory, considered a cheaper alternative to

hard drive and micro hard drive units, emerged as the

preferred storage format in Argentina.

Brazil rallied behind the production and sale of

low-cost 3G mobile phones that offered internet

connectivity, email and video features.

Distributors in Chile and Mexico saw declines in

unit prices of consumer electronics products as

imported brands entered the market.


28


Asia Pacific: Getting the Best in Technology

Despite the introduction of several new competitive

brands in the market, Chinese consumers still consider

brand image (the combination of low price and high

technology) as the fundamental reason to buy a product.

Having launched its Next-Generation

Networks (NGN), Japan is now ready

for the introduction of a long list of new

electronic products. The government

has developed a strategy that

facilitates the entry of next-generation

network-capable consumer electronics.

India‟s multi-brand retail chains

Croma, Vijay Sales and Vasanth &

Co. gave consumers more options

by providing a wider array of

sophisticated electronic products.

NGN Process:

Courtesy of Ericsson Corporation


29


Asia Pacific: Getting the Best in Technology

Taiwanese consumers preferred large LCD TVs

screens, usually 37-inches or more. Local

manufacturers are able to develop advanced products

at lower material costs thanks to the ready supplies of

TFT LCD panels in the country.

The Malaysian government encouraged the adoption of the

Terrestrial Digital Video Broadcasting (DVB-T) standard for

broadcasting transmissions and rolled out digital

transmission in and around Kuala Lumpur in 2009. It‟s

hoped that it will expand nationwide by 2013.

Demand for premium consumer electronics products in

Singapore was bolstered by the launch of HD television

channels, as well as by the aggressive promotion of

HDTV content and services by the government and

industry players.

Demand in South Korea is for slim,

compact and colourful mobile phones,

reflecting the attractiveness of these

products among younger consumers.

A DVB-T receiver commonly used in Malaysia.


30


Australasia : Balancing Technology and Environment

The Australian government declared that all new TVs

must comply with its 10-point energy ratings scheme

that allows consumers to quickly see which television

screens are best for energy consumption.

The entry of LG Electronics into the New Zealand market in

2007has allowed consumers there to enjoy fully the digital

technology lifestyle.

Many environmentally conscious consumers are

putting off purchasing new televisions until

manufacturers demonstrate their environmental

credentials.

In 2009, the popular media device TiVo was launched

in New Zealand. TiVo promises to turbocharge free-to-

air digital TV and put viewers in control.

Logo courtesy of Tivo Inc


31


Middle East and Africa: New Opportunities

Lenovo‟s first attempt to enter the

Middle East market was with its Idea

Pad „Netbook‟ in 2008. The initiative

confirmed the region‟s appetite for

sophisticated technology.

Touch screen technology is catching on in the

Middle Eastern market. Sony Ericsson introduced

its Xperia X1 mobile phone which boasts a full

QWERTY keyboard and a three-inch touch

screen.

In South Africa, infrastructure development projects are

underway in preparation for the 2010 soccer World

Cup. These projects may pave the way for increased

demand for a wide range of consumer electronics

products over the next years.

Sony Ericsson Xperia X1 mobile phone

Idea Pad „Netbook‟


32


Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




33

© Euromonitor International >Consumer Electronics-TrendsChannel Analyses

Western Europe

Durable goods retailers remained popular in the higher

end of the market, where many consumers require

personalised service. Many customers remain loyal to

their local suppliers, especially those that provide

comprehensive after-sales service and offer free

product delivery and home service installation.

Grocery retailers have been focused on products

positioned in the lower and middle tiers of the sector.

However, they are slowly integrating premium products

into the mix in order to satisfy demand from the higher

end of the market.

A Tesco outlet in the UKPhoto courtesy: Tesco Corp

Despite the continued prevalence of durable goods retailers in

the region, hypermarkets have emerged as key distribution

channel. Western Europe is undergoing channel transition,

away from traditional mixed retailers and durable goods

retailers. Hypermarkets are able to cross-subsidize expansion

into non-traditional segments. They also wield increased

bargaining power over manufacturers, resulting in lower prices

and increased pressure of manufacturers‟ profit margins.

A durable good retailer outlet in Belgium

Photo courtesy: ADEG Österreich Handels AG

A hypermarket in Spain

Photo courtesy: Mondragon Corporation


34


Eastern Europe

Hypermarkets and supermarkets are becoming the

prevalent distribution channels in Eastern Europe.

These retailers offer a wider range of electronic

products, giving consumers more options and ensuring

they get the best value for their money.

Altex expanded its presence in Romania by

increasing to 14 the number of stores it

operates in the country.

Russian consumers increasingly preferred to buy CE products

in specialist shops. This has encouraged the development of

retail chains and has led to increased competition, which has

resulted in lower prices and improved customer service.

Rimi hypermarket in Latvia

Photo courtesy: Rimi Baltic

A computer electronics specialist store in

Russia

A retail chain store operated by Altex in Romania


35


North America

Kiosks revolutionized retail in the

US. Manufacturers and distributors

placed kiosks in high-traffic areas

and improved channel‟s image

among consumers.

Dell kiosk (above), Sony kiosk (below)

Best Buy, Circuit City and Wal-Mart are the big players

in the North American CE retail sector, offering

consumers the widest array of consumer electronics

brands.


36


Latin America

Brand loyalty is an influential factor in the

Latin American CE market. Gradiente,

Brazil‟s flagship brand, maintains traditional

distribution sites as well as online site that

offers consumers a wide range of consumer

electronic products.

In Latin America, consumers preferred

durable goods retailers, shopping in

chain stores directly operated by major

market players.

Right inset: One of the 200 Red Megatone

retail stores in Argentina.

Bodega Aurrera in Mexico

Many Mexican consumers are attracted by

the less expensive options offered by

discounters such as Bodega Aurrera,

Tiendas ISSSTE, Bodega Comercial

Mexicana and Bodega Gigante.

A Gradiente webpage.


37


Asia Pacific

Many major players in the Asia-Pacific market

enthusiastically expanded their retail spaces in order to

broaden their offerings of consumer electronics products.

Labi Akihabara: a five-story computer store in

Akihabara, Tokyo Japan.

Gome and Suning became the biggest two specialist

multiples in mainland China.

Online retailing serve as an alternative

distribution channel for most Asian consumer

electronics retailers. The increasing popularity of

using credit cards online allows retailers to

improve sales in spite of intensifying market

competition and global economic setbacks.


38


Australasia

Dick Smith Electronics and Dick Smith

Powerhouse provide consumers with

budget electronics that are initially

launched by major manufacturers in the

Australian market.

Chains like 100% YES (Your Electronics Store),

which has 60 stores located all over New

Zealand, remain popular. Smaller family-

operated ventures are also popular among New

Zealand consumers.

Durable good retailers remain the most significant

distribution channel in the Australasian CE

market. The ability to provide customers with

expert advice has made Harvey Norman one of

the region‟s most popular chains.

Photo courtesy: Harvey Norman

FAV, a small in-car electronics shop in

New Zealand.


39



South African consumers have become

more open to internet retailers and online

shopping. Clemstone, e-dreams, Croma

and i-mate are among the numerous

popular online shops that offer varied

consumer electronic products catering to all

segments of the market.

Durable good retailers continue to be

the most popular distribution channel in

the Middle East CE market. The entry

of many big retail players contributed to

the increase in the channel‟s

distribution share over the review

period. In 2008, the Landmark Group

opened the Emax Big Box store, tagged

as the largest multi-brand consumer

electronics store in the Middle East.

Emax Big Box channel store in Dubai.


40


Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




41


There was strong demand for High

Definition televisions (HDTVs),

particularly those with LCD and plasma

flat panel displays, HD and Bluetooth

technology.

Plasma and LCD displays became the

most prevalent formats. Analogue

televisions disappeared from retail store

shelves.

The strong development of the LCD TV

panel market has resulted in massive

investments in new production facilities

by manufacturers, increasing the

availability and driving down the costs

and thus making the products more

attractive to consumers.

Brand-name sellers of consumer

electronics and PCs entering the LCD-TV

subsector intensified competition and

helped drive down prices.

Category Analysis

In Home-consumer Electronics: Televisions and Projectors

-4.9

61.4

74.8

39.6

8.8

17.3

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

TVs and Projectors Global Volume Performance

(2003-2008 CAGR)


42


Global sales of VCR players dwindled while sales of

DVD player peaked in 2008.

The growing popularity of digital broadcasting, cable

TV services and the increased ability to download

content from the internet drove global demand for

both VCRs and DVD players.

VCR/DVD combinations are disappearing from the

global market. Because of their "bridge" function

between VCR and DVD technologies, these

combinations have a slightly higher sales level than

solely VCRs, but they are also an old technology

that is simply outdated and has little role to play in

the modern digital age.

In 2008, Toshiba the primary company supporting

HD DVD, announced that it would no longer

develop, manufacture, or market HD DVD players

and recorders.

Category Analysis

In Home-consumer Electronics: VCRs and DVD Players

Competition between Blu-ray DVD and HD DVD formats was intense, as the winner would determine the direction of future new product launches. Blu-ray had backing from Sony Pictures, Buena Vista, 20th Century Fox, Lions Gate, Warner Bros, New Line Cinema and Studio Canal. HD was supported by Universal Studios, Paramount, MTV Films, DreamWorks, The Weinstein Company, Image Entertainment, Magnolia Pictures, Brentwood Home Video, Ryko, Koch Entertainment and Goldhill Entertainment.

7.1

3.0

-45.3

-50.0

-40.0

-30.0

-20.0

-10.0

0.0

10.0

DVD playersVCR and DVD combinations

Video cassette recorders

VCR and DVD Players Global Volume Performance (2003-2008 CAGR)


43


TV and VCR/DVD combinations are disappearing

from the global market. Earlier launches tied VCR

and DVD players to analogue televisions,

contributing to declining demand.

VCRs have become outdated, compelling

manufacturers to focus on other potential high-

growth areas.

TV combination products did not spark consumers‟

interest, especially when such new products as

HDTVs were introduced into the market.

Current demand for slim TV panels discourages

manufacturers from incorporating built-in players,

except for an HD and USB slot.

Category Analysis

In-home Consumer Electronics: TV and VCR/DVD Combo

8,908.48,279.6

7,756.77,408.6

6,430.25,868.0

0

2,000

4,000

6,000

8,000

10,000

2003 2004 2005 2006 2007 2008

„00

0 u

nits

TV and VCR/DVD Combo Global Volume Performance (2003-2008)

TV and VCR/DVD combinations

Leading manufacturers like Toshiba, Sharp, Westinghouse and Sylvania launched several sophisticated digital television and DVD combinations in the market in 2008, following the reasoning that some households continue to prefer these devices. In the final analysis, however, the only way to sell this these products in significant numbers is to improve design and technology.

Toshiba 22LV506


44


The most important factor influencing

performance in the home audio and cinema

sector has been the development of “home

cinema culture” in combination with advances

other sectors like television and projectors and

DVD players, all of which can be integrated into

home cinema systems.

The introduction of HDTVs allows households to enjoy

their LCD and plasma TVs in an almost cinematic

experience. This has bolstered demand for home

cinema and speaker systems, which had sales of more

than 22.2 million units in 2008.

The rise of home cinema complements DVD players.

Compact home cinema and speaker systems (Home

Theatre in a Box) allows consumers to maximize their

living space and achieve total home entertainment.

Home cinema and speaker systems have become

additions to modern-day interior, and manufacturers

are increasingly incorporating fashionable and

attractive designs into their products to attract

customers.

Category Analysis

In-home Consumer Electronics: Home Audio and Cinema

Philips’ recently launched Ambisound HTS8100 compact home cinema system does not require five speakers to allow users to enjoy the cinema experience, as it is contained within a 15cm box, known as Sound Bar. Onkyo TX-SR605 is the first AV receiver to include HDMI 1.3 and to read new sound formats such as DTS-HD and Dolby True HD.

0.00

20.00

40.00

60.00

80.00

100.00

120.00

2003 2004 2005 2006 2007 2008

US

$ b

illio

n

Cinema and Home Speakers Value Sales (2003-2008)


45


Global sales of personal computers have been

affected by increased demand for replacements,

particularly new products with higher memory

capacity, flat-panel monitors and a wider range of

hardware and software capabilities. Volume sales of

personal computers grew at a CAGR of nearly 10%

between 2003 and 2008.

Gender and age became factors among consumers

shopping for personal computers. Colourful

computers and peripherals attracted younger

consumers and women, while professionals and

older consumers tended to prefer classic and more

compact designs.

Larger LCD monitors bolstered volume sales of

personal computer peripherals. During the review

period, computer users increasingly used their PCs

not only to work and surf the internet but also for

personal movie viewing.

Category Analysis

In-home Consumer Electronics: Personal Computers

50

150

250

350

450

550

650

750

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Personal Computer Volume Performance 2003-2008

Computer peripherals Desktops

0

20

40

60

80

100

120

140

160

2003 2004 2005 2006 2007 2008

US

$ m

illio

n

Personal Computer Value Performance (2003-2008)

Desktops Computer peripherals


46


There has been increasing demand for the new point-and-shoot cameras laden

with advanced technological features, such as face detection, wireless IR

technology, dust reduction, in-camera image stabilization and splash-proof

technology. Manufacturers are also ramping up the competition in terms of

megapixel sizes.

Digital single-lens reflex cameras (DSLR) were the

most dynamic products in the sector. In contrast,

analogue cameras disappeared, although there is

still slight demand from traditional photographers.

Compact and lightweight cameras with higher

memory capacities continue to drive digital camera

sales. Global volume sales of digital cameras

reached more than 124 million units in 2008.

The increased popularity of camera phones

continues to challenge camera sales, particularly at

the low end of the market.

Category Analysis

Portable Electronics: Cameras

Canon Power

Shot E1 was

launched as a

more compact

digital camera

than preceding

models.

5

25

45

65

85

105

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Volume Demands of Cameras (2003-2008)

Analogue cameras Digital cameras

0

10

20

2003 2004 2005 2006 2007 2008

mill

ion

s

Global Sales of Photo Printers (2003-2008)


47


The camcorder market has evolved from tape-based

analogue formats to DVD, hard disk drives and flash

memory.

DVD camcorders were popular among consumers

given their ease-of-use with DVD players and their

advanced videographic features and editing options.

Prices for DVD camcorders declined markedly

during the review period. Volume sales off

camcorders overall reached more than 26 million

units in 2008.

The capacity of flash memory cards is increasing,

and the format is being recognized as ideal for

storing hours of recorded video. Compared to other

formats, flash memory devices are more durable,

offer longer battery life, are typically smaller and

offer faster read and write speeds.

Category Analysis

Portable Electronics: Camcorders

Integrating new technologies into digital camcorders to produce hybrid camcorders became the latest trend in product development. New hybrid camcorders by DXG include a five-megapixel still camera, VGA-resolution video recorder, digital music player, voice recorder and a video game device. Disposable camcorder pioneer Pure Digital Technologies introduced its next-generation flash-based video recorder that facilitates easy uploading of video to YouTube. Hitachi introduced the world's first Blu-ray camcorder in 2007.

0

5

10

15

20

25

30

2003 2004 2005 2006 2007 2008

Mill

ion

un

its

Global Volume Sales of Digital Camcorders (2003-2008)


48


In 2008, the first-generation

Zune was created by Microsoft

in close cooperation

with Toshiba, which took the

design of the Gigabeat S and

redeveloped it under the

name Toshiba 1089.

The popularity of MP3, DVD and multimedia players drove

the impressive sales performance in the global portable

media players sector. Volume sales of portable multimedia

players reached more than 47 million units in 2008.

Hard drive-based multimedia players have become very

popular among consumers. These products can read

digital audio files from hard drives, allowing users to store a

greater number of songs (depending on storage capacity).

Portable multimedia players were the best-performing

product in the sector. Factor contributing to the product‟s

success include declining prices, portability, fashionable

designs and the availability of a range of options such as

wireless connectivity.

Flash memory MP3 devices are becoming more popular

than HDD models. Flash memory devices are typically

more compact and handy than their HDD counterparts.

Category Analysis

Portable Electronics: Portable Media Players

Easier access to mobile content (movies, music, photos and games) became the driving force among players seeking to gain significant market share in the portable multimedia player subsector. (Right inset: The new iPod Touch.

0

5

10

15

20

25

30

35

40

45

50

2003 2004 2005 2006 2007 2008

In m

illio

n u

nits

Global Volume Sales of Portable Multimedia Players (2003-2008)

The new Ipod Touch


49


Technological convergence became the key trend

influencing the mobile phone subsector, which saw the

introduction of many new models offering streaming

video, advanced camera features, MP3 capabilities

and global positioning systems (GPS). Global volume

sales reached nearly 886 million units in 2008.

Consumers' desire to listen to music, watch video,

play games and communicate anywhere and anytime

is transforming the global mobile phone sector. All-in-

one portable communication/ entertainment systems

complement to the growing consumer demand to be

connected and entertained on-the-go.

The heightened demand for mobile phones has been

stimulated in part by the continuing roll-out of

advanced telecommunications infrastructure, such as

Wi-Fi and 3G mobile phone technology.

The success of mobile phones continued to be

determined by the availability and accessibility of

online content, which in turn depends of the

sophistication of the underlying

telecommunications infrastructure.

Category Analysis

Portable Electronics: Mobile Phones

Mobile phones are now turned into a handheld computer that can be used as a media player, TV, Internet browser, GPS navigator, planner, digital camera

0

100

200

300

400

500

600

700

800

900

1,000

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Demands for Mobile Phones (2003-2008)

Nokia E75


50


All-time low prices, the convenience of portability,

growing wireless capabilities and increasing

processing speeds drove an increasing number of

consumers to portable computers. Volume sales

grew at CAGR of 23.4% between 2003 and 2008.

Laptops with brighter colours, eye-catching

structural features and artistic designs became

commonplace as computer makers tried new tricks

to attract consumer attention. In 2008, nearly 94

million laptops were sold worldwide. The introduction

of Netbooks in 2008 also contributed to strong

demand.

Laptops are used by young computer users not only

to complete school assignments but also as stereo

systems and DVD players. In response to this trend,

computer makers are launching new products with

funky designs and bright colours to attract young

consumers.

Category Analysis

Portable Electronics: Portable Computers

HP iPAQ 4150 Pocket PC

Lighter, thinner and higher capacity were the key features stressed by manufacturers as they launched their new lines of portable computers. As well, advanced technological features, such as WiMAX, high-definition optical drives, flash-based hard drives, encrypted hard drives and high-end graphics cards, were integrated into laptops.

0

10

20

30

40

50

60

70

80

90

100

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Global Volume Sales of Laptops(2003-2008)

Laptops


51


Players in the in-car consumer electronics sector

face strong competition from original equipment

manufacturers (OEM). Over the review period,

volume sales of in-car media players grew at a

CAGR of 2.7%, reaching more than 45 million units

in 2008.

In-car consumer electronics products provide auto

manufacturers with higher margins, and they are

increasingly incorporating these products in new

cars as either standard or optional equipment.

Due to the popularity of products like iPods, mobile

phones and video games, there is a little interest

among younger consumers for in-car media players.

Aftermarket sales of in-dash CD players displayed a

lethargic performance during the review period.

These are now considered to be standard equipment

in new cars.

Category Analysis

In-car Media Players (Aftermarket)

0

5

10

15

20

25

30

35

40

2003 2004 2005 2006 2007 2008

in m

illio

n u

nits

Comparative Volume Demands forIn-car Media Players (2003-2008)

In-car CD players

In-car DVD players

In-car radio casette players

In-car radio players

The concept of interconnectivity allows consumers to link one consumer electronics device to other devices through in-car navigation systems. Bluetooth-enabled products are an example. Stereos can be linked to mobile phones and other devices, including portable music players.


52


Sales of in-car speakers were buoyant in the Asia

Pacific region, accounting for more than 61% of

overall global sector volume sales in 2008. The

majority of sales, 18.5 million units, came from

China.

Despite competition from other in-car electronics

products, demand for in-car speakers increased

significantly, sustained by younger consumers who

want to be informed and entertained on-the-go.

In the more developed regions, there is an ongoing

challenge to players in the in-car aftermarket sector

from players in the OEM sector. This increased

competition has led to declining demand for a

number of aftermarket products, including speakers.

Most new cars today come with relatively high-

quality speakers as standard equipment.

Manufacturers in the in-car aftermarket sector are

continually seeking to improve the technology and

the raw materials needed for the production of next-

generation in-car speakers.

Category Analysis

In-car Speakers (Aftermarket)

13%

9%

6%

4%

61%

2%5%

Comparative Volume Sales of In-car Speakers by Region 2008

Western Europe Eastern Europe

North America Latin America

Asia Pacific Australasia


“Consumers are always driven towards a high performance speaker system with rich well-balanced sound.” – G Audio


53


The in-car navigation system subsector is one of the

fastest-growing segments in in-car consumer

electronics. Global volume sales grew at a CAGR of

nearly 56% during the review period, reaching 36.5

million units in 2008.

Manufacturers are now introducing navigation

systems with hard drives. These products are key to

growing sales in the sector as they accommodate

much larger volumes of information.

Declining prices have had an impact on sales of the

more expensive fixed navigation units, helping to

attract new consumers to these products.

New integrated GPS navigation systems come with

several new features, such as city guides, restaurant

reviews and information for walkers and hikers, and

they now include location-specific advertising.

Category Analysis

In-car Navigation Systems (Aftermarket)

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Global Volume Sales of In-car Navigation Systems (2003-2008)

The entry of new players in the in-car

navigation market resulted in

increased competition, which led to

price reductions on a large scale. In

turn, increased volume sales led to an

expansion in distribution networks in

all regions.

In 2008, Pioneer launched a hybrid portable GPS device that is a cross between a personal navigation device and an in-dash navigational system.


54


The growing popularity of in-car MP3

players has created a good

opportunity for leading multimedia

player manufacturers to establish a

niche in this subsector.

Growth in the “other” in-car consumer electronics

subsector came primarily from increased demand for

MP3 players, minidisc players, satellite digital radio

modulators, equalizers, amplifiers, sound processors

and car televisions. Overall, volume sales reached

more than 22 million units in 2008, representing a

CAGR of nearly 19% during the review period.

As in other in-car segments, Original Equipment

Manufacturers (OEM) present a growing threat to

aftermarket players in this market, as car

manufactureres increasingly offer electronics in their

new cars.

Global sales of in-car multimedia players and in-car

DVD players complemented the increased demand

for in-car television sets during the review period.

Generally, this will be considered by many industry

players to be a growth opportunity.

Category Analysis

Other in-car Consumer Electronics

A TomTom GO in-car MP3 player allows drivers to listen to all of their favourite tunes while on the move. The unit has a built-in 20 GB HD. Photo courtesy: TomTom

0.0

5.0

10.0

15.0

20.0

25.0

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Global Volume Sales of Other In-car Electronics (2003-2008)


55


Volume sales for computers grew at a CAGR of

nearly 15% during the review period, reaching 192.5

million units in 2008.

Volume sales of laptops grew at a dramatic pace

during the review period, with a CAGR of nearly

29% compared to desktops with a CAGR of 7%.

Portability was considered to be the laptop‟s

competitive advantage.

It is expected that volume sales of laptops will

surpass volume sales of desktops for the first time in

2009. Value sales of laptops passed those of

desktops in 2007.

Increased consumer demand for design, capability and

convergence technology drove new sales in the sector.

Distributors intend to maintain profitability in the midst

of the global financial crisis by generating the research

resources necessary to launch new products.

Companies will also buy the expertise needed to offer

customers complete computer solutions.

Category Analysis

Computers: desktops and laptops

“The Bookshelf”, the next-generation of

computers. Photo courtesy: Purdue University.

0

50

100

150

200

250

2003 2004 2005 2006 2007 2008

mill

ion

un

its

Global Volume Sales of Computers (2003-2008)


56


Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




57


In 2008, Hewlett-Packard continued to be the global

market leader in the distribution of in-home

consumer electronics products, specifically personal

computers, printers and computer peripherals. The

company‟s contract manufacturing (CM) and original

design manufacturing (ODM) strategies paid off,

providing cost-efficient and delivery-efficient

products. In 2008, HP reported net revenue of

US$118.3 billion.

Sony closely followed HP‟s lead in the consumer

electronics sector, selling more than 70 million units

worldwide. In addition to successfully launching Blu-

ray as the new industry standard DVD format, the

company‟s Bravia television brand reported a

remarkable global sales performance. In 2008, Sony

reported consolidated net sales of more than

US$88.4 billion.

South Korea-based Samsung reported volume sales

of nearly 45 million units in 2008. These included

televisions and projectors, home cinema and

speaker systems, personal computers and

peripherals and printers.


In-home Consumer Electronics

HP12%

Sony11%

Samsung7%

Logitech5%

Panasonic 5%

LG5%Microsoft

3%

Dell3%

JVC2%

Epson2%

Others45%

In-home Consumer Electronics: Top Global Brands by Volume Share 2008

Other top brands include Sharp, Toshiba, Lenovo, Canon, Pioneer, Acer, Lexmark, Fujitsu, Apple, Hitachi, Bose and Daewoo.


58


In 2008, LG reported volume sales of

portable consumer electronics products of

more than 52 million units. The largest

proportion of sales (14%) came from the

Indian market, consisting mostly of sales of

mobile phones.

Approaching volume sales of more than 156 million units in 2008,

Nokia was the market leader in the global portable consumer

electronics sector. The biggest sales came from the Indian market,

where Nokia recorded a market share of more than 21% in 2008.

In the same year, Nokia posted total revenues of US$66.6 billion.

Motorola ranked second in the worldwide list thanks to

considerable sales of mobile phones in the US market. The

company maintained a volume share in the US market of more

than 42% in 2008. In the same year, Motorola reported revenue

sales of more than US$30 billion.

Samsung focused its efforts on developing smartphones, devices

with open operating systems that allows users to run a wide range

of applications. In 2008, Samsung reported nearly 100 million

portable units in worldwide distribution.

Sony maintained its edge over other global players in the portable

CE sector in 2008 with volume sales of nearly 67 million units

worldwide. Its distribution channels in China, which focused on

cameras, camcorders, portable media players, laptops and palm

and pocket PCs, accounted for 34% of the company‟s worldwide

sales.


Portable Consumer Electronics

Top 10 Global Brands 2008

(Portable electronics volume share)

Brand % Share

1 Nokia 14.6

2 Motorola 10.7

3 Samsung 9.2

4 Sony 6.3

5 LG 4.9

6 Apple 4.3

7 Panasonic 2.8

8 Hewlett-Packard 2.7

9 Canon 2.0

10 Sony Ericsson 1.9

Global demand for mobile phones, laptops, MP3 players and portable multimedia players drove increased sales in the portable consumer electronics sector.


59


Pioneer Corp was the global market leader in the in-car

consumer electronics sector in 2008, due to increased sales

in China, Russia and South Korea. The company reported

worldwide volume sales of more than 26 million units in

2008.

Sony ranked second worldwide in volume sales in 2008,

with sales in the Chinese and US markets accounting for

more than 60% of the company‟s worldwide total. In 2008,

the company reported volume sales of nearly 25 million

units.

Japan-based Alpine Electronics found itself in third place in

2008 by distributing more than 10 million units worldwide.

Most sales came from the Chinese and US markets.

Panasonic ranked fourth among top global brands

by registering volume sales of nearly nine million

units in 2008. In the same year, both Kenwood and

JVC registered volume sales of nearly eight million

units.


In-car Consumer Electronics

Top 10 Global Brands 2008 In-car electronics

(aftermarket) volume share

Brand %Share

1 Pioneer 14.6

2 Sony 13.6

3 Alpine 5.7

4 Panasonic 4.9

5 Kenwood 4.4

6 JVC 4.4

7 Garmin 3.2

8 Clarion 3.1

9 TomTom 2.8

10 Navigon 2.2

15%

14%

6%

5%

4%4%3%3%3%

2%

41%

In-car Consumer Electronics: Global Brands by Volume Share 2008

Pioneer

Sony

Alpine

Panasonic

Kenwood

JVC

Garmin

Clarion

TomTom

Navigon

Others


60


Toshiba ranked fourth in

global volume sales in 2008

with sales of nearly five

million units. Apple followed

with sales of four million

units while Sony ranked sixth

with three million units.

Netbooks began to flood the market in

2008, paving the way for ultra-slim and

portable computers at affordable prices.

Hewlett-Packard was the market leader in

both the desktop and laptop subsectors in

2008, with combined volume sales of more

than 18 million units. Maintaining the HP

umbrella brand, in 2008 the company

launched a number of new brands,

including HP Pavilion, Compaq Presario,

HP Pavilion Elite desktops, HP HPDX

Premium and Touchsmart PCs.

Dell successfully invigorated its brand

image in 2008, producing a wide range of

new sophisticated computers. As a result,

the company ranked second globally,

selling more than 17 million units in 2008,

up from 15 million in 2007.

Lenovo sold more than six million

computers in 2008, ranking it third in global

distribution. Most of the company‟s sales

(US$3.6 billion or 44.2% of overall value

sales) came from the Chinese market in

2008.


Computers

2008 Top 10 Global

Computer Brands,

Volume share

Brand % Share

1 HP 9.4

2 Dell 8.9

3 Lenovo 3.3

4 Toshiba 2.5

5 Apple 1.8

6 Sony 1.6

7 Fujitsu 1.6

8 Compaq 1.3

9 Samsung 1.0

10 ASUSTeK 0.9

2008 Top 10 Global Netbook

Brands, Volume share

Brand % Share

1 Acer 38.3

2 ASUSTeK 30.3

3 HP 5.8

4 MSI 5.7

5 Dell 2.8

6

OLPC (One

Laptop Per

Child) 2.3

7 Medion 2.3

8 Kohjinsha 1.0

9

Intel (Classmate

reference

design) 1.0

10 Lenovo 0.7

Acer Aspire One Netbook


61


Scope

Global Performance

Regional Trends



Channel Analysis

Category Analysis




62


It‟s expected that the global financial crisis will force

market players to revise prospects and review existing

conditions necessary to sustain profitable economies of

scale.

Future trends in the industry will include a further

expansion in the number of high-definition televisions that

support full HD 1080p resolution and as well as thinner

flat-panel screens. Technology advances will include self-

luminous organic light-emitting diode (OLED) televisions,

which offer brighter images and wider viewing angles.

Manufacturers are expected to continue to integrate Blu-

ray DVD technology into their new products over the

forecast period.

The shift by consumers to accessing music from online

sources, whether it be through downloading songs or by

listening to internet radio stations, will continue to have a

significant impact on the home audio industry.

Consumers will continue to demand thinner

television panels and higher screen resolution

capabilities. Next-generation televisions will

also provide embedded content that will allow

consumers to connect directly online or

connect to other electronics devices via their

units.

Sales of home cinema and speaker systems

will grow based on integrated Wi-Fi and

Bluetooth capabilities.

In addition to introducing new technologies,

new product launches over the forecast

period will be based on consumer demand for

products that are energy-efficient ,

environmentally friendly and hazard-free.


In-home Consumer Electronics

Environmental stewardship is increasingly held up as a competitive marker among computer manufacturers. Leading players like Hewlett-Packard and Dell have realized that there are significant public relations benefits in endorsing a green policy. This has also led companies to promote computer recycling programs and to introduce product modifications that facilitate recycling efforts.

From Digital to 3D Broadcasting: the next major leap in home entertainment. Future in-home consumer electronics products will capture 3D-generated content, convert captured content via broadcast and transmit real 3D images to viewers.


63


Miniaturised portable electronics products will continue to

attract more consumers over the forecast period. This trend

will affect future formats of video cameras and printers.

Ultra-portable consumer electronics are expected to

become significant products in the sector.

Newly launched smartphones will continue to accommodate

a wide range of content applications and offer seamless

connectivity. By packing wireless internet connectivity, a

camera, a gaming platform and a navigation system into a

single device, the iPhone will continue to offer consumers

an attractive value proposition in spite of its hefty price tag

and bundled mobile telephony network contract.

While consumers go for slimmer and sleeker flat-panel

screens, players will continue to explore the introduction of

embedded content and connectivity via 3G networks in

future product launches. Hard times are likely to make the

synergies provided by combining different technologies into

a single, miniaturised unit even more compelling to

consumers.

Sales of ZUNE are expected to increase

over the forecast period, but Microsoft

must do more than just simply compete

with other multimedia players. It must

work to redefine its market to sustain

long-term demand. Netbooks will

continue to sell well due to their design

and low-power consumption.


Portable Consumer Electronics

Portable electronic

Affordability

Seamless content /

connectivity

Convergent technology

Salient Features of Portable

Electronics Products

Devices like the Flip (dubbed the iPhone of camcorders) and the Kodak Zi6 Pocket Video Camera will continue to be prevalent products in the market over the forecast period as video tape and optical disks with solid state memory are phased out, allowing new products to be substantially smaller than their predecessors.

Flip camcorder


64


“Infotainment” will continue to shape future demand

for in-car consumer electronics. In addition to digital

video, radio and music , new products will also

provide drivers with information about their vehicle‟s

performance as well as GPS navigation.

Market players are expected to introduce navigation

systems with hard drives, as they are keys to

expanding the sector's sales since they

accommodate larger volumes of information.

In-car consumer electronics remain a likely area for

technological convergence, combining such features

as satellite radio, Bluetooth-ready car-stereo head

units and receivers, video and audio connections

through MP3 players, MP3-compatible head units

and HD.

In the future, manufacturers are expected to

introduce hybrid in-car consumer electronics, such

as GPS navigation devices that are a cross between

personal navigation devices and in-dash

navigational systems.


In-car Consumer Electronics

Streaming video to cars is considered the next big feature in in-car entertainment, although widespread adoption is still several years away. Nevertheless, manufacturers are currently debating which medium will offer consumers the best in-car viewing.

Design courtesy: Motortrend


65


Netbook launches will continue over the forecast

period, paving the way for more ultra-portable and

powerful high-end computers. It‟s projected that

value sales of netbooks will reach US$ 34.7 billion in

2013.

A wide range of consumer electronics market

players, including Dell and Sony, are expected to

jump on the netbook bandwagon over the forecast

period.

Affordability, portability and convenience are the

features that will continue to drive computer sales

over the forecast period. In the laptop subsector,

customisation and personalisation are expected to

play roles in the purchasing decision, as well.

In the current global financial crisis, the R&D

budgets of leading multinational computer

manufacturers could be squeezed, affecting the

rate of their new product launches and the

development of new technologies. This could

level the playing field in the market a bit and be

an advantage for lesser-known brands, which

never had large R&D budgets to begin with.


Computers

0

50

100

150

200

250

300

2009 2010 2011 2012 2013

US

$ b

illio

n

Projected ComputersMarket Value Sales

Aside from being more compact and slimmer, newly launched computers in coming years will also accommodate digital broadcasting technology and enhanced connectivity with other consumer electronics devices, including mobile phones, digital cameras, camcorders and portable multimedia players.


66


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