People buying more technology than ever before

LCD TV sales grew 160 per cent in 2006 in the US, as consumers continue to buy more and more technology devices for their homes.

Despite concerns of a general slowdown in sales of consumer electronics products, sales were up just over 13 per cent last year, bringing in $145.7bn wholesale for manufacturers.

But this year, sales growth is expected to halve. The market is predicted to still be worth $155bn and the Consumer Electronics Association said a growth of 6.5 per cent in 2007 was still high. "At 6.5 per cent, that's still twice GDP," said Sean Wargo, director of industry analysis for the Consumer Electronics Association (CEA).
Although these figures are for the US, trends in the UK tend to reflect what is happening in America.

Homes in the US now have 25 pieces of consumer electronics product, compared to just 1.3 in 1975. And people are setting more money aside to buy devices than ever before. Households were on average spending $1,500 in 2006 on new gadgets, and this is expected to rise to $2,000 this year.

"Consumers are adopting new technology faster than ever," said Wargo. This in part is down to cost reductions, a trend also apparent in the UK. The price for DVD players last year fell 54 per cent, 50in plasma TVs dropped 32 per cent and sub four mega pixel cameras fell by 40 per cent.

High definition take up in the US is now accelerating, getting closer to the point where sales of HDTVs outstrip those of standard definition sets. "As consumers look for high definition, one reason they can do that is because of flat panels - these are pushing the TV market towards unprecedented heights." It is expect it to be a $26bn market in 2007.

Sales of HD players though were slow last year, partly caused by delays to Blu-ray and partly because of the standards battles between that and the HD DVD camp.

These are likely to diminish with the release of hybrid players, although onl y one million HD players are expected to sell into US home in 2007. Growth is predicted to kick in the following year, with 4.2 million homes buying either a Blu-ray or HD DVD player, rising to 11.6 million in 2009.