Promising Trends for Startups at CES

CE Manufacturers Open Up to Third Party Content Publishers and Technologies

Each year, the Consumer Electronics Show kicks off the year with a bang and sets the stage for technology trends for the year. With so many consumer electronic innovations (smart phones, tablets, and now ultrabooks), we’re heading into the second decade with a digital transition. 2012 will be the year of the interface; the user experience is now the focus for increasingly connected devices. 

We're already seeing the cycle: from birth to complexity to simplicity. Remotes, for example, went from having 5 buttons to 50. Now, we need to think about simplicity once again. Apple is a perfect example. It appeals to consumers because of its clean, simple design, which was quite a departure from most of the technology at the time it was first released. Despite the return to simplicity, many new features are still being added. Most new features, such as voice and gesture control, are designed to create a frictionless experience for the user.

It’s no surprise that smart phones and tablets drove growth numbers in 2011 and are expected to be the two biggest CE spending categories globally in 2012. The average American household has 25 CE products in their home. Expectations for new product launches include:

• 30-50 ultra books to launch this year
• Another 50 or so tablets to launch this year
• Significant growth in new “smart,” connected TV’s

All of these devices are increasingly integrated and have more computing power than ever before. Traditional non-core devices (phones, tablets, TV’s) are now behaving like computers with cloud connectivity, apps, and browsers built in. In 2010, 12% of all TV units shipped were Internet capable, and by 2012 we expect that nearly half of all TV’s that ship globally will be connected TV’s.

So what does all of this mean for the startup landscape?  A tremendous amount of opportunity to develop user experiences across multiple screens, devices, and OS.

Key takeaways for startups:

• Consumer electronics are becoming increasingly about the user experience and less about the actual technology. If faced with a decision between two electronics, today’s consumers are going to choose the one that is the best looking and that gives them the best user experience.
• Cloud connectivity is accelerating the growth and demand of app creation and marketplaces.
• With all of the data that comes with new apps and information from multiple digital assets, universal search will ultimately be a necessity.  
• It’s getting personal- users want to personalize their devices, which customizes their experience.

As this year’s CES showed, functional value now slips behind sleek product design and slick interfaces. The consumer electronics industry will now need to embrace extended relationships with content providers, third-party technologies, developers, and brands, providing an open door for startups to enter.