Growth in Digital Media Offers CES Hints

Regular suspects like TV make the list of fastest-growing consumer technologies, but digital video recorders and portable MP3 players hint at what's to come.

LAS VEGAS—Soothsayers attempting to divine the hot trends at this years International Consumer Electronics Show need to look no further than TiVo and the iPod.

Those products represent two of the fastest growing categories in consumer electronics—digital video recorders and digital music players. And they are helping to drive an expected 50,000 product launches during the four-day CES here, said Sean Wargo, director of industry analysis the Consumer Electronics Association, during a media preview event on Tuesday.

"Were talking about a product explosion and products for everything," Wargo said. "Everybodys bringing out new products for this [consumer] market."

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Digital video recorders like TiVo Inc.s namesake product were expected to grow 204 percent for 2004 and exceed 1 million U.S. shipments, while portable MP3 players like Apple Computer Inc.s iPod were expected to grow 184 percent, Wargo said.

Neither topped the fastest-growing list for 2004, but both were key up-and-comers. DVD Media actually was expected to record the highest gain with 212 percent. Falling in second was LCD televisions, projected to have risen 205 percent.

The overall U.S. consumer electronics market was expected to grow 11 percent in 2004 to $113.5 billion in shipment revenues and to expand another 11 percent in 2005 to reach $125.7 billion, according to the CEA.

But the rapid rise in consumer interest for digital video recorders and MP3 players points to a larger trend: greater creation, storage and sharing of digital content. That trend is most evident in digital imaging, Wargo said.

"In 2004, we saw a breakaway for digital imaging," he said. "Were talking about a digital imaging market of over 20 million units per year, and this is TV size and is a huge market."

Digital cameras, for example, were the second most sought-after item among consumers in CEAs 2004 holiday wish-list survey.

As consumers create more digital images, the more they desire to take those images and other digital content with them, Wargo said.

In a survey the CEA conducted last year, the average consumer maintained a library of 600 photos consuming 1.26GB of storage. In five years, that consumer is projected to keep an average of 3,420 images using 7.2GB of storage, Wargo said.

One storage technology that appears ready to meet the need is the flash media drive. The flash drives already are reaching heights of 1GB of storage, and Wargo said they soon should hit 4GB of storage.

"It becomes a more attractive alternative to disks and hard drives," he said. "Its a great technology for consumers looking to move content around."

Also on the horizon, and likely to be on display during CES, are Wi-Fi-enabled cameras and printers. They will allow consumers to share images and download photos for printing without touching a PC, Wargo said.

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Exhibits at CES, the worlds largest consumer technology show, open on Thursday and will display much more than digital recorders, MP3 players and cameras. Organizers are expecting more than 2,400 exhibitors filling 1.5 million square feet of space.

The show, which runs through Sunday, is projected to draw 120,000 attendees from 110 countries.

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