Technology consumers are expected to ease up on their purse strings a bit, but only if they’re in the market for a flat TV, a Blu-ray DVD player or a netbook.
“There are definitely some green shoots in our midst when it comes to consumer electronics,” said Shawn DuBravac, economist and research director at the Consumer Electronics Association, a trade group based in Arlington, Va. “It looks like consumer spending might have bottomed already. It’s been moving up since January or February and I think that bodes well for the rest of the year.”
It’s been a tough six months or so for makers of consumer electronics as shoppers have delayed discretionary purchases. A new TV or computer certainly falls within that category, but consumers have been reluctant to give up their new technology, DuBravac said.
“Technology spending as a percentage of all durable goods is actually on the rise,” he said. “Consumers are cutting back, but they are doing so relatively less on technology goods. Tech-nology appears to be less discretionary than in past recessions.”
Some have pointed to new gadgets as an escape for consumers who are bogged down with bad economic news. Some consumers are justifying new TVs and Blu-ray DVD players as ways to save money by staying in for entertainment. And the other star seller, netbooks,small, portable computers that are inexpensive cousins to higher-performance laptops,offer a savings to computer shoppers.
From the beginning of the year through May, flat panel TV sales are up 32% from the same period last year, the data showed.
“Even in the face of the recession, flat panels have done really well,” DuBravac said.
In North America, some 7 million liquid crystal display TVs were sold during the first quarter, up 23% from a year earlier, according to DisplaySearch, an Austin, Texas-based unit of market researcher NPD Group Inc.
Flat TV manufacturers, including Irvine’s Vizio Inc., got a boost recently as retailers kept the holiday spirit going by extending lower prices and promotions into January and February.
Consumers came out in droves to take advantage of historically low TV prices.
“TVs definitely have become more attractively priced,” DuBravac said.
Consumers have cut back on other things, such as going out to eat or to the movies, and are opting to be entertained at home.
“They are trying to maintain a quality of life, and they want something to feel good about by creating a theater-like experience in their home,” DuBravac said.
Same idea goes for Blu-ray DVD players.
The market is projected to double in 2009, according to CEA data.
“Blu-ray players have done phenomenally well,” DuBravac said.
Vizio is jumping on the bandwagon with a sleek Blu-ray player, priced at $200, set to debut next month.
Stamford, Conn.-based market research group Gartner Inc. forecasts some 9 million Blu-ray DVD players will be purchased this year, up from about 6 million sold in 2008.
Sales of netbooks, sometimes called mini-notebooks, are set to nearly double this year, according to Gartner’s data.
Gartner expects consumers worldwide to buy some 17 million netbooks, up from roughly 10 million sold in 2008.
Some industry watchers say the economic downturn could even drive demand for netbooks this year.
“Their low cost may lead buyers to extend the lifecycle of their standard notebooks and consider a mini-notebook as an additional device for on-the-road Web surfing and entertainment,” said Tracy Tsai, senior research analyst at Gartner.
A netbook is typically defined as being lightweight and portable, with a screen less than 12 inches, fewer features than a traditional laptop and a retail price of around $400 or less.
“Consumers have gravitated to them in a very big way,” CEA’s DuBravac said.
That’s especially true in Asia.
Gartner sees some 4 million netbooks being shipped to customers in China, Taiwan and South Korea, among other countries, up 82% from 2008.
Netbooks are seen as accounting for more than 10% of all notebook sales by 2010 or 2011, the data showed.
