CES Outlines Electronics and Videogame Outlook

The Consumer Electronics Association (CEA) has released its hald-year report for the U.S. Consumer Electronics Sales and Forecasts. The consumer electronics industry is expected to bring in $140 billion this year, which is up 8 percent over 2005. That's on top of an 11 percent climb from 2004 to 2005. According to the report, the videogame industry will take in $12.5 billion this year, thanks to the introduction of two new next generation consoles this fall with Nintendo's Wii and Sony's PlayStation 3 and the continued rollout of Microsoft's Xbox 360.

The videogame industry is expected to see a 16 percent spike in hardware, software and accessories sales from 2006 to 2007, according to the report, as more next generation hardware enters the market place and more gamers jump on the current generation and portable gaming bandwagons. By 2007, gaming is expected to generate $15 billion in revenue in the U.S. alone. Next generation gaming consoles will have a direct impact on many consumer electronics purchases. As more gamers upgrade to HD gaming devices like Xbox 360 and PS3, more households will buy HD TVs to get the most out of their gaming technology. Digital display devices, which includes HD TVs, are expected to climb from $19 billion in sales in 2005 to $22 billion this year. The sale of surround sound systems and other home theater devices is also directly connected to next generation gaming sales. The Blu-Ray Disc capabilities of PS3 will also play a role in the rollout of HD-DVD and BR-D next generation DVDs. Many of the Hollywood studios (five of the six majors) have committed to BR-D in large part due to Sony's PS3 plans. For 2007, BR-D and HD-DVD stand-alone players are expected to ship over 1 million units. More consumers are also upgrading to recordable DVD players, which are expected to top sales of 7 million units this year. "The mid-year numbers show continued robust growth in the CE industry, category to category," said CEA President and CEO Gary Shapiro. "Consumers are embracing new technologies in this digital age, as they make new or upgrade purchases for the home, the car, the office or anywhere."