January 2, 2011 / 11:06 PM / in 7 years

CES gadget fest sizzle fizzles

<p>A visitor interacts at the Microsoft booth during the 2010 International Consumer Electronics Show (CES) in Las Vegas January 7, 2010. REUTERS/Mario Anzuoni</p>

SAN FRANCISCO (Reuters) - Some 125,000 attendees descending on the annual tech gadget confab in Las Vegas this week can be forgiven for feeling as if they have traveled back in time.

Once the premier showcase of consumer technology’s cutting edge, in recent years the Consumer Electronics Show has wallowed in the shadow of the one company that never attends: Apple Inc. The iPad maker famously snatched the spotlight from the show in 2007 when it unveiled the first iPhone at a rival convention. This year, the specter of a new iPad awaits.

Still, legions of executives, journalists and geeks will make the annual pilgrimage to the Nevada desert’s glittering oasis to pore over what they did last year: fancier televisions and tablets.

“The more things change, the more they stay the same,” said NPD analyst Stephen Baker. “We’re in more of an incremental world than a monumental world, moving ahead a bit at a time.”

Last year, a slew of electronic books and periodicals readers took center stage. Prototypes of more full-featured tablet devices were shown off, but companies were waiting to see how Apple would fare with the iPad, which was unveiled a few weeks after last year’s CES.

The blockbuster sales of the iPad has inspired an explosion of me-too devices at this year’s trade show. The tablet market is expected to surge to more than 50 million units in 2011, and analysts expect companies like Motorola Inc, Lenovo and Toshiba Corp, among many others, to use CES to show off their iPad killers.

Longtime tech analyst Roger Kay of Endpoint Technologies said most companies are fearful of spending research dollars on a unproven market.

“Businesses by nature tend to be cautious, and they’ve been cautious this year; they’re spending less. They’re less willing to take chances than they were in 2007. But that has a downside,” he said.

TV INNOVATION CHALLENGE

A procession of global technology chiefs declared 2010 as the year of 3D televisions, only to cut prices and retrench by the end of the year.

This week, they are expected to talk up Internet connectivity on the small screen and attempt to address the decade-old unfulfilled promise of connecting your television to Web shows and software stored in the cloud and on your personal computers.

Unlike tablets, the fight over the connected living room lacks a dominant player -- or even a common method for delivering content. But it does not lack for aspirants.

“It’s going to be the Wild West for a while,” Baker said.

The battle will pit heavyweights including Samsung, Sony Corp and LG Electronics, but also companies like Google Inc, Netflix and Apple, all fighting to make their technology the standard.

Jason Oxman, senior vice president of the Consumer Electronics Association, the trade group that runs CES, said every TV maker is now looking to incorporate Web connectivity.

“TV manufacturers see the opportunity to provide that content built in. I think you’ll be hard pressed to find a TV on the show floor that doesn’t have these kind of apps built in,” he said.

KEYNOTES KEY

Products like tablets and connected TVs, which scarcely existed five years ago, now command outsized attention from heavyweights like Sony, Microsoft Corp, Intel Corp and Samsung Electronics, all of which will have a major presence at CES.

With a show floor of more than 1.5 million square feet, CES will feature the usual crush of gadgets: from cameras to home theater equipment to PCs.

Consumers are spending again on technology, following the contraction from the global financial crisis in 2008. The CEA expects consumer electronics revenue in the United States to rise 3 percent in 2010 to $174.9 billion, and climb another 4 percent in 2011.

CES officially kicks off on Thursday, but the activity starts a day earlier, as product launches and keynotes begin.

The major keynotes at CES will include Microsoft CEO Steve Ballmer, Verizon CEO Ivan Seidenberg, Ford Motor Co CEO Alan Mulally and Audi AG Chairman Rupert Stadler.

There will be particular interest in Ballmer’s address, following reports that Microsoft will unveil a version of its software that runs for the first time on processors designed by UK-based ARM Holdings. ARM’s chips dominate the tablet and handheld device market.

Verizon has said it would use CES as a platform to talk about its first phones for services based on Long Term Evolution (LTE), a technology standard with which Verizon is currently upgrading its network.

AT&T and T-Mobile USA are also expected to show off gadgets that run on faster data networks.

Reporting by Gabriel Madway; Additional reporting by Sinead Carew; Editing by Kenneth Li and Richard Chang

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