MP3s, flat TVs dominate

Gizmos land among CES 'mega-trends' as U.S. sales rocket

Darrell Proctor, Rocky Mountain News

Published January 5, 2006 at midnight

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LAS VEGAS - It's all about portable music players and flat-panel TVs.

One look around the floor of the Las Vegas Convention Center confirms that, with much of the space devoted to companies pitching all manner of MP3 devices and big- screen televisions.

And no wonder - U.S. shipping revenues of portable MP3 players in the first 11 months of last year were up 224 percent over 2004.

And sales of flat-panels - LCD and plasma sets - are expected to go from $6 million in 2005 to $10 million this year, helped by prices that are steadily, if still slowly, falling.

That's according to Sean Wargo, the director of industry analysis for the Consumer Electronics Association, sponsor of the International Consumer Electronics Show.

Wargo admits that overall growth in consumer electronics is likely to fall in 2006, after an 11.3 percent jump in U.S. shipments in 2005, with total revenues of $126 billion. Wargo said he expects growth to settle around 7.5 percent this year.

"Portable audio is the main growth sector," Wargo said during a presentation Tuesday at the Venetian Hotel.

"With iPod, Apple . . . we have a lot to thank them for."

Wargo, who spoke on "Mega- Trends at CES," said as the price of flat-panels comes down, purchases are going up.

He said the average price of a 27-inch LCD TV last year was $799.

"Wait until the end of the show," he said, talking about the CES event that runs today through Sunday here. "It will probably be less."

Wargo's words rang true during a tour of the Las Vegas Convention Center on Wednesday, as many of the 2,500 CES exhibitors continued to set up their displays in advance of today's opening. It's obvious that offerings of digital televisions and MP3 players dominate this show.

John Taylor, vice president of government relations and communications for LG Electronics USA Inc., said his company didn't want to miss an opportunity to reacquaint consumers with LG's "Life's Good" campaign - as well as show off its 50-inch wireless plasma HDTV, which won a CES "Best of Innovations" award.

"We're not unveiling anything really new at the show, but we do have several of our products that we've upgraded," Taylor said, as he stood in front of a 42-inch LCD HDTV, with a built-in high-definition digital video recorder, or DVR.

Wargo said the DVR market continues to evolve. He expects 6 million units to ship in the U.S. this year, with 23 percent of those recording in high definition, up from just 10 percent in 2005.

As for those MP3 players? Music is still king, but video is making an impact.

The CEA estimates 22.4 million portable music players shipped in the U.S. in 2005, with 15 percent of those video capable.

In 2004, just 7.1 million music players shipped. In 2006, the group predicts shipments to rise to 27.7 million - with 30 percent able to play video in addition to tunes.

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