Tech demand to defy economic headwinds says Deloitte

Tech demand to defy economic headwinds says Deloitte

FMCG SUPPLIER NEWS

Business Live - Jan 19th, 12:28

Demand for consumer technology will continue to grow in 2012 with demand from emerging markets for lower-cost televisions and computers boosting volumes, says Deloitte 

Sales of smartphones and tablets will spiral upwards, reaching record levels, Deloitte added.

Sharoda Rapeti of the Technology, Media and Telecommunications (TMT) practice at Deloitte found that the tablet 'explosion' had shown little sign of slowing down since the format hit consumer markets in 2010.

"The tablet is set to take the mantle of the most rapid 'multi-anything' market penetration in history. About five million tablets will be sold in 2012 to people who already own one, generating about US $2 billion in revenue," Rapeti noted.

"In stark contrast, it took several decades for one household to have more than one car, phone, radio or television. It took ten years for a similar landmark to be reached in the computing and mobile phone markets."

However, the tablet market will diversify around size, processing power, price and operating systems in 2012 as was the case with smart phones.

Corporations are also likely to require tablets with greater security and ruggedness.

"That presents a challenge for content owners, network operators and retailers that need to prepare to respond to the rise in the multi-tablet household."

Rapeti said that although sales of smartphones, tablets and lower-cost televisions and computers were predicted to climb, the dollar value of the market might prove to be flat as lower prices and the "bang for your buck" value of technology became more paramount.

The cost of technology has plummeted over the past three decades and the use of a tablet and a television, compared to a car, overseas holiday or sporting event, proved that consumer electronics fared well in terms of value.

Compared to the cost of buying a car or a house, the traditional rite of passage for families, an investment in consumer electronics could become an alternative status symbol for consumers with constrained budgets.

"Buyers may even sacrifice holidays and rather upgrade to a new computer and television."

Big data projects had a total industry revenue of only US$100 million in 2009. However, 2012 was expected to see 90% of Fortune 500 companies kick off a big data initiative which would trigger industry revenue of between US$1 billion and US$1.5 billion.

"Big data is still in its infancy, mostly used for meteorology and physics simulations, but interest is gaining pace as data warehouses start to overflow and the need for 'real-time' analysis puts strain on traditional analytics tools.

"Internet companies have led the way with exploring big data but fast follower sectors are likely to include the public sector, financial services, retail, entertainment and media," Rapeti said.

This could trigger a talent shortage with up to 190,000 skilled professionals needed to cope with demand in the US alone over the next five years. Meanwhile companies launching initiatives needed to take a disciplined and targeted approach to big data.

Rapeti pointed out that the storage technology used for the world's consumer devices was mostly taken for granted by consumers by the increasing desire for smaller, lighter gadgets and the advent of the cloud could provide a boost for the solid-state drive providers.

By the end of 2012, solid state storage for small devices such as MP3 players, smartphones and tablets would likely account for 90% of the market, compared to 20% in 2006, and a sixth of the laptop segment.

"Even data-centred markets could turn to smaller, cooler, power-sipping solid state drives as an alternative to more traditional hard drives."

The technology, which built storage onto silicon chips, should benefit from the more discerning consumer, who will begin to pay more attention to how much storage they actually needed on specific devices, particularly as more cloud-based storage services became available.

Wireless power transmission - where TV towers and mobile phone masts could be used to create a sea of ambient Radio Frequency energy to power devices - has been a dream since the age of Nikola Tesla.

"However, power harvesting products based on RF will remain a niche market during 2012 due to significant technical challenges," Rapeti said.

One issue was the scarcity of ambient RF energy with solar a much more plentiful resource.

Another problem was that the amount of power density from a RF source varied dramatically depending on the distance and location of the user.

"Interference from other environmental factors and the conversion process also adds hurdles. Charging a tablet in this manner would be like filling a swimming pool with a shot glass. There are a few applications - such as ceiling sensors and remote controls - that may be tuned to RF but the sector will remain niche with moderate growth potential in 2012."

Rapeti added that 3D printing had caught the attention of the public but the hype around the technology did not recognise the severe limitations of the concept.