Consumer Electronics Gets Ready for Change

Consumer Electronics Gets Ready for Change

New business models are emerging to better reward those innovators that make the  convergence dream a reality.

Client: Qualcomm/Economist Intelligence Unit
Assignment: White paper

Commissioned by the Economist Intelligence Unit for Qualcomm. Read the original here.

Executive Summary

eiu_slanted

Two of the top-five items on the wish list for US consumers for Christmas in 2007 were electronic devices. For teenagers, the figure was even higher: four out of five.

Thanks to these  free-spending consumers, global sales of consumer electronics were forecast to reach US$600bn in 2007, with mobile phones, televisions and personal computers (PCs) accounting for nearly one-half of that figure.

However, this boom masks uneasiness at the heart of the consumer electronics business.

Traditional economics no longer make sense.
Commoditisation of products has eroded revenue and forced companies to rethink their business model.
At the same time, digital convergence is providing opportunities for new products and services.

Making any content available over any network on  any device is immensely appealing, and new service offerings seeking to straddle these boundaries are starting to appear. New business models are emerging to better reward those innovators that make the  convergence dream a reality.

As the communications and media industries converge, opportunities for consumer electronics
firms to serve the digital home will expand. This is part of a broader trend towards a digital lifestyle,  characterised by media on the move, digital delivery of media to the home and accessible media storage within the home.

Nevertheless, there remain big technical, commercial and legal barriers for the industries that stand to make the most from digital convergence—consumer electronics, telecommunications, content providers and software houses—and it will be some years before all players embrace the far-sweeping business implications of this enormous commercial opportunity.

Comments are closed