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2010 Consumer Electronics Show features less gloom than 2009's

By Mike Musgrove
Sunday, January 10, 2010; G04

It's nice to see the consumer electronics industry get its mojo back.

At last year's Consumer Electronics Show, even Microsoft essentially admitted to a droopy feeling, as chief executive Steve Ballmer acknowledged a sense of "reduced expectations" in his industry.

But this year, Ballmer's company, along with the rest of the 2,500 or so exhibitors, enthusiastically dived back into the business of trying to sell you stuff you never thought you needed. Tired from all that strenuous Xbox button-mashing? This fall, as Microsoft demonstrated from a Las Vegas stage, you'll be able to control the game console with a wave of your arm, thanks to technology that will be able to "see" your every movement.

Clearly, this is an industry hoping to get people reaching for their wallets again. Revenue for the consumer electronics industry dropped almost 8 percent in 2009, the first decline in 20 years. The head of the Consumer Electronics Association, Gary Shapiro, referred to it as "the most challenging year of our lives," in a keynote speech.

This just-begun year doesn't necessarily look much better. The Arlington-based trade group, which puts on the annual CES event, projects that revenue will crack the $165 billion mark this year, only slightly better than its 2009 performance.

The bright spots for this industry: netbooks and e-readers. Sales of the tiny Web-connected laptop devices doubled last year, and sales are expected to be strong again in 2010. With a wave of Kindle competitors hitting the market, sales for Amazon's reader and similar devices are expected to double again this year.

Digital cameras, on the other hand, continue to slump, largely thanks to market saturation. Sales for the cameras were down 3 percent in 2009, and the CEA expects a similar performance this year. Even so, that's a lot better than the numbers for GPS navigation devices, which have taken a huge hit, thanks to factors including slow car sales and smartphones with built-in mapping. Sales in this category were down 18 percent in 2009, and the organization expects a further 7 percent slip in the new year.

As for the waves of e-readers, tablet-shaped computers and 3-D television sets that were unleashed last week, it's too early to tell how they will fare, but many of the seasoned pros said that they were impressed by what they saw.

"There's a lot of excitement," said Robe Enderle, a tech industry analyst, speaking from the show's floor last week. "For so long, it seemed like every [CES] show had the same products but with different versions. This year, it's hard to pick 'the' hit product because there are so many wonderful ones."

It's a far cry from last year, he said, where some attendees were wondering whether they were seeing the last gasps of this show. "It felt like a wake," he said.

All that buzz coming from Las Vegas last week won't necessarily add up to consumer sales. Last year's hot-hot item on the CES show floor was the Palm Pre, a slick smartphone that was expected to brighten the gloomy fortunes of its parent company and give the iPhone a run for its money. Unfortunately for Palm, the device has faced disappointing sales and has failed to make a dent in BlackBerry or iPhone sales, despite generally favorable reviews.

For those of us who stayed close to home this year, it was easier than ever to experience the show, although without the long Vegas taxi lines, the Lady Gaga sightings and the gadget-lugging backache. Even before the show's doors opened, a fire-hose stream of tweets was declaring the show's winners and losers.

One winner, an iPhone-controlled helicopter device, was a surprising debut from an unknown French company; to steer the thing, you simply tilt your iPhone. The company says the device, which is technically a "quadricopter" because of its four propellers, will come with built-in cameras and "augmented reality" games that will allow owners to get into shoot-'em-up games with one another. A video showing off the device in flight became so popular among Web-surfing technophiles that the company's site temporarily crashed (fortunately, a copy pasted to YouTube has been more resilient to Web traffic). Zut alors, but the company hasn't disclosed a price for the thing yet.

On the other end of the spectrum, a TV tucked into a cutesy stuffed polar bear enjoyed a few days of fame as the butt of jokes from an impressive range of people, encompassing Jimmy Fallon's staff and mom bloggers alike.

But don't laugh: Chances are, there will probably be a 3-D version next year.

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