Q Thoughts

CES 2011 Stuffed with New and Revised “i” Products

by Michael Chass

CES 2011 was an exciting show. Attendance was up, optimism was in the air and the manufacturers were out in full force with all of the latest and greatest “i” products. But I do not mean iPhone, iPod, or iPad. That’s yesterday’s news and boooring.

The “i” I’m referring to is “i”nternet connected devices. And I am not talking about just set top boxes. Integrated devices that connect a TV, Blu-Ray player, stereo, etc. to the internet is nothing new. What is new seems to be the marketing push put behind such features, as well as significant enhancements to the platforms.

The big trend was for every device to go wireless for connectivity. Only 53% of people who buy products in this category are actually connecting them to the internet, because it is difficult to run an Ethernet cable from your router to the device. Wireless solves this problem.

An even more significant trend was found on the user interface of the products. Many changes/evolutions have been unfolding, and there was a strong push for app-based functionality on these devices. Samsung and LG were clearly the class winners. The “home page” on the devices were full of content-rich application choices that went beyond the typical Vudu, Netflix, and Pandora (which everyone seems to have and adds little differentiation).

As someone who is in the advertising industry, it did strike me the CE companies were not finding a way to monetize the application home/control pages. These key areas are excellent places for content relevant advertising to provide revenue. It’s not as if these devices provide high margin – this type of revenue could double if not triple the gross profit per unit with very little additional work. There is content-relevant advertising within some of the apps, but why would a CE manufacturer give all of that revenue to the application company? CE companies should move quickly to rectify this deficit. Consumers find this type of interaction in every single piece of media they interact with, from cable to satellite to digital radio. So why not in this space as well?

CES was an action packed show with many new offerings. Connecting traditional CE devices to the internet is no longer a trend. It is the new “i.”

Categories:Posts from 2011


Leave a Reply

Your email address will not be published. Required fields are marked *