Searching for a Star Product : Electronics: Personal organizers, home fax machines and “smart houses” have potential. The industry will check out consumer items at its Las Vegas show.
The 1980s brought us videocassette recorders, cordless telephones, compact disc players and, to the horror of many a parent, a resurrection of the video game industry.
But as the 1990s dawn, the consumer electronics industry finds itself in search of the next blockbuster product capable of rekindling the explosive growth manufacturers enjoyed at the height of the last decade.
“The industry is looking for a new technology and a hot product, but so far, there’s nothing on the horizon,” says Ron Rotter, a consumer electronics specialist and money manager in Calabasas.
However, as the industry’s huge Consumer Electronics Show, which opens Saturday in Las Vegas, will clearly demonstrate, there are still many products with ample growth opportunities, and perhaps, a future as a superstar.
Among the odds-on favorites of some experts to reach blockbuster status this decade are hand-held personal organizers and computers, home fax machines, camcorders and miniature cellular telephones.
Others look to the introduction of digital audio tape players later this year to spark a consumer buying spree sometime in the 1990s, once initial prices drop.
And still other analysts say the industry may have to wait even longer, until high definition television sets--still very much a research laboratory device--are introduced in the mid- to late 1990s.
Still, for the time being, there is no “gotta have” product. And there’s no consensus what it will be, or when it will appear.
The situation has forced manufacturers to “soup up” existing products with new features, such as the “screen within a screen” television, and to compete as they traditionally have: by dropping their prices.
“There is no agreement now on what the single hot product will be,” says Jim Wilcox, senior editor of Consumer Electronics Monthly, a magazine published in New York. “Right now, there’s nothing that people are going to want to have like they wanted a VCR or a microwave.”
Where does that leave the industry?
Actually, not in as bad a shape as one might think. The industry just completed a record year, posting nearly $33 billion in sales, up about 6% from 1988. Although the growth rate is lower than it was at the beginning of the decade, analysts note that the growth was spread among many more products last year. And they note the success in 1989 of such “old time” products as the television, which benefited from larger screens and the addition of stereo sound in top-of-the-line models, and the telephone answering device, which has been dressed up with new bells and whistles.
Further, analysts say, there are several well-recognized emerging trends in society that could keep the cash registers humming at the nation’s electronics emporiums.
Most often cited is the rising number of home offices and at-home workers. According to recent studies, an estimated 25 million Americans currently work at home, and one-quarter of those contain two home-based professionals. With advancing telephone and computer technology erasing the boundaries between home and office, and stricter air pollution standards aimed at getting commuters off the freeways, working at home has become increasingly popular.
Products these workers are expected to buy include desktop facsimile machines, sophisticated telephone devices, personal copiers, electronic typewriters, computers and hand-held organizers.
“You are going to see a lot of items that can be used in the home office such as translators, computers, and hand-held items you can take on the go,” said Cynthia Upson, a spokeswoman for the Electronics Industry Assn., sponsor of the semi-annual Consumer Electronics Show. “You can take a fax machine and cellular phone with you, and can fax something back to your office.”
Another evolving trend is the growing merger of audio and video products to create what promoters like to call “total home theater environments.” These products include wrap-around stereo sound equipment, laser video discs, disc players that can handle both audio and video platters, stereo television, and the long-awaited digital audio tape players.
The introduction of DAT players--which provide high-quality sound in a low-cost format--had been held up by the recording industry, which feared that the technology would promote unlicensed copying of compact discs. However, an agreement reached between manufacturers and the recording industry provides for the inclusion of an anti-copying device in each DAT player. The first of these products, already available in Japan, is expected to be introduced into the United States later this year.
Yet another potential source of new products is in the field of home automation. So-called “smart houses” have been on the drawing boards, in laboratories and in selected field sites for years, but retrofitting the nation’s existing housing stock with networked appliances and computer-directed systems has long baffled engineers.
On Saturday, the Electronics Industry Assn. will unveil its standards and prototypes for how existing homes can be outfitted with electronic appliances that work together. For example, the new system envisions that a homeowner could telephone instructions to an oven to start warming a casserole left there in the morning, or direct a dishwasher to turn itself on. Security systems could be armed and disarmed by telephone and utilities could be triggered by remote.
The show, which will be spread over some 800,000 square feet at the Las Vegas Convention Center and four nearby hotels, is expected to draw 70,000 attendees from the United States and 80 foreign countries.
SNAPPING UP THE GADGETS
Gadgets Around the House
Table below lists popular consumer electronics devices and the percentage of U.S. households that own one or more.
Television: 98 %
Videocassette recorder: 64
Phone answering machine: 28
Cordless phone: 23
Home computer: 22
Compact disc player: 16
Camcorder: 8
Source: Electronics Industry Assn./Consumer Electronics Group
