Guess the Hot Item at Consumer Electronics Show--Good Old TV : Retailing: That and video games, PCs and small-dish satellite systems stole the spotlight from the more exotic products.
It wasn’t long ago that exotic digital products with names like Newton and 3DO and Mini Disc were being tabbed as saviors of the consumer electronics industry, gadgets that would draw consumers into stores and reignite stagnant sales.
At this year’s Consumer Electronics Show here, it’s clear that reignition has taken place. But the credit goes to a relatively prosaic group of products that have been around for a while: Sales of television sets, 16-bit video game machines and personal computers drove total sales of consumer electronics up 9.2% to $59.9 billion in 1994, according to figures released Friday.
For all the hype about the information superhighway, it seems that many people are mainly interested in bigger TVs. Sales of projection TVs soared 40% to 650,000 last year, while sales of big-screen color TVs jumped 25%--exceeding sales of those minuscule under-25-inch sets for the first time.
And if there was one new digital product that was living up to its billing, it was the single major TV-related one, namely the small-dish digital satellite system from Thomson Consumer Electronics. The so-called DSS system, which provides access to programming from Hughes Communications’ DirectTV and another broadcaster called USSB, has sold about 600,000 units at $700 apiece since it was introduced last June, and retailers are ecstatic.
“We love it,” enthused Barry Bradshaw, general manager of Sight & Sound Concepts in the City of Industry. “And it helps sales of big-screen TVs and surround-sound systems.”
As soon as Thomson hits the 1 million sales mark, other vendors will be licensed to build DSS units, with Sony Corp. scheduled to be the first on the bandwagon.
Sony Corp. of America Chief Executive Michael P. Schulhof, who gave the keynote speech at the show, could use a hot-seller; not only are Sony’s movie operations under siege, its Mini Disc audio format has yet to catch on, and revenue from its newest “revolutionary” product--a digital video disc player--are still a couple of years away.
And it will face a tough battle too with its upcoming Playstation game machine--the CES floor was littered with slow-selling game formats, including 3DO and Atari Jaguar.
Sega of America chief Tom Kalinske says his company’s outdated 8-bit player outsold 3DO by 10-to-1 last year.
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The other big news at this year’s CES, of course, is the personal computer. Sales of PCs, software and assorted add-ons like mice and sound cards grew 20% to $13.2 billion.
But even as the dozens of CD-ROM software publishers here celebrated a banner Christmas season, many of them were coping with the problems of success in the consumer market.
Walt Disney Co., for example, has found itself the focus of consumer wrath as thousands of parents who purchased the firm’s “The Lion King” CD-ROM for the holidays were unable to make it work on their home computers.
The company sold 200,000 of the discs in just the six weeks before the new year.
Designed to run on high-end personal computers, the software flashed error messages and “general protection fault” messages on many machines that didn’t have the specific equipment necessary to run the disc.
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Disney executives in Las Vegas said they have created an 800 number for customers to call, and are sending out new versions of the disc that will work with a lower-level sound card than the original program required.
The Disney product is getting much negative attention in part because it is one of the few hit CD-ROMs for children, who tend not to understand the complex “read me” files that are included in most computer software.
But the firm has the sympathy of other software publishers.
“We will expect the same Disney experience as we widen our market,” said Martin Alper, chief executive of Virgin Interactive.
“There’s a real danger if publishers are not ready to help consumers through the early learning process that the market will be hurt.”
