The high-tech trade group Consumer Technology Association (CTA) has released their mid-year industry forecast and predicted that traditional tech is beginning to be overshadowed by emerging technology. According to the report, the US consumer technology industry will grow to $286.6 billion in 2016 largely due to expanding adoption of Internet of Things (IoT) connected devices and a growing enthusiasm for emergent technology. Sales of new tech products like drones, wearables, smart home devices and virtual reality headsets will lead to a 1.3% increase in industry revenue over 2015. The forecast examines factory sales to dealers and retailers of more than 300 different tech products.
Five of the largest and most established categories of the tech industry will account for 51% of tech industry revenue this year, including smartphones, tablets, televisions, laptops and desktop computers. These top five categories have been relatively stable industry leading products for nearly a decade now. They will account for more than $114 billion in annual sales, with smartphones and televisions pulling in the lion’s share. However CTA is predicting that in 2017 these categories will end up contributing less than 50% of industry revenue, which will be the first time that has happened in several years.
“We’re in the midst of a critical transition period, as more IoT products offer the anytime/anywhere access and seamless experiences that today’s consumers want and need. This is a pivotal point in consumer technology history, as emerging tech categories – virtual reality, voice-controlled digital assistants, drones – push the entire industry forward. And the value of these innovations goes far beyond entertainment – today’s technology is changing our lives for the better,” explained the president and CEO of CTA, Gary Shapiro.
Some of the emerging technologies that CTA is predicting will cause this shift in industry revenue sources will include 4K Ultra High-Definition (4K UHD) technology, fitness trackers and other wearables, cloud-based artificial intelligence-powered virtual assistants and smart home products. Additionally, drone sales are expected to reach records highs of 2.4 million, a 112% increase over 2015. In the US, drone sales for models below and above 250 grams, the FAA’s threshold for required drone registration, are expected to grow to 1.6 million units for drones below 250 grams and 825,000 units for drones over 250 grams in 2016.
3D printing technology will continue to expand over its previous model, as has been the trend for several years now. According to CTA, the 3D printing industry’s unit sales will increase by 56% over last year. They expect unit sales to reach up to 171,000 individual 3D printers sold. The continued refinement of 3D printing technology is expected to be the primary cause of this growth, as more industries and personal users purchase desktop 3D printers that continue to drop in price. The total revenue generated by the industry is expected to increase by 35% for a total of $148 million.
The real star of the tech industry sales will be Virtual Reality (VR) technology, including VR headsets and VR content. CTA expects that VR headsets being introduced by several companies in 2016 will be the overwhelming leader in year-to-year growth. Individual unit sales are expected to increase by 296% over 2015 and reach 800,000 units sold. The total revenues that are being projected will reach $432 million, a 332% increase over VR unit sales in 2016.
“Technology is constantly and continuously reinventing itself, often cannibalizing its own growth before anything else does. The swath of emerging categories hitting the market in 2016 and the exponential growth of IoT are indelibly shaping the way we live our lives. How we use the internet, and the new products coming to market today, are changing who we are becoming,” said, chief economist for CTA, Shawn DuBravac, PhD.
The U.S. Consumer Technology Sales and Forecasts report is published two times a year, in both January and in July. It was developed by CTA to forecast the surprising trends of high tech, emergent technology and the effect that it will have on the tech market as a whole. CTA’s DuBravac will be hosting a Facebook Live Q&A chat to discuss the surprising trends and predictions in the report on July 19th at 4PM ET. You can join the conversation on CTA’s Facebook Profile, as well as going over to the Emerging Technologies forum at 3DPB.com to discuss further.