Will CES 2013 turn into the Consumer Experience Show?
Next week in Las Vegas tens of thousands of technology and mobile executives, professionals and enthusiasts will gather for the 2013 Consumer Electronics Show. As in recent years, the wireless industry will have a significant presence at the show, but from what I'm hearing from analysts and insiders there may be less of a bang at this show than in years past.
There will certainly still be plenty of gadget unveilings and network demonstrations, but the nature of the show seems to be evolving. I think the industry should expect less of a hardware-centric show and one more focused on the somewhat amorphous term of "consumer experience." Handset makers, chipset firms, network vendors and carriers are all trying to get their arms around, explain and promote the idea that their hardware and networks are more than feeds, speeds and specs, and that they actually enable experiences that are meaningful for the people who use them.
Granted, they have been trying to do this for years, with middling success, but a confluence of factors has me convinced this may be the year that CES actually focuses more on the consumer experience than actual consumer electronics.
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First, from a mobile device perspective, it looks like this show will be light on major announcements. Samsung Electronics is likely to focus on its TV business and other parts of its electronics empire--according to a December CNET report, we shouldn't expect a major announcement like the Galaxy S IV. And In the absence of major launches from established players like HTC, LG Electronics and Nokia (NYSE:NOK), Chinese vendors ZTE and Huawei appear poised to steal some of the spotlight. ZTE is expected to announce the 5-inch Grand S Android while Huawei will probably announce the massive 6.1-inch Ascend Mate. For its part, Sony Mobile Communications will probably unveil new Xperia Android phones. Research In Motion (NASDAQ:RIMM) is obviously keeping its powder dry for its Jan. 30 unveiling of BlackBerry 10, and many companies appear to either be waiting for Mobile World Congress in late February to make major device announcements or are planning to host their own events to kickoff new products.
If there are fewer device announcements at CES, what will fill the void? I think it will be a focus by vendors and carriers on user experiences. I've been getting indications from multiple sources that Qualcomm (NASDAQ:QCOM) CEO Paul Jacobs will use his "Born Mobile" keynote Monday to make some news. The announcement will likely be less about specific smartphone platforms or even chipsets, and more along the lines of the company's Vuforia augmented reality platform or Gimbal SDK, which provides context-aware services to applications for Android and iOS. Jacobs' keynote may presage many talks by executives about the user experience.
AT&T Mobility (NYSE:T) usually makes news at its developer summit that is held right before CES. This year the company will likely do the same. Yet the company used its annual investor conference in November to make news about its network plans, including expanding LTE coverage to 300 million POPs by the end of 2014. Without a lot of new ground to break on the network front, AT&T could use the summit to tout its "Digital Life" unit, which focuses on home automation and security services. In New Orleans in May AT&T offered the press and analysts a view of how this will work in practice, but the company may try and put some more meat on the bones of its efforts, and could also talk about cloud services.
T-Mobile USA will likely use its own event Tuesday evening to expand on the themes CEO John Legere laid out in December at parent Deutsche Telekom's investor conference. Those include doing away with device subsidies for its plans rate in 2013, the benefits of its combination with MetroPCS (NYSE:PCS), an aggressive marketing strategy, and its plans to finally offer Apple (NASDAQ:AAPL) products. Since the carrier's invitation promises "an evening of amazing 4G experiences," T-Mobile could detail its plans for its LTE network, which it has said it will launch this year.
Not to be outdone, Verizon Communications (NYSE:VZ) CEO Lowell McAdam will have a keynote address at the show on Tuesday. In 2011, McAdam used an appearance at CES to announce that Verizon would open an application innovation center so that developers can build apps specifically designed for its then-new LTE network. This time around, I would expect McAdam to talk about Verizon's Viewdini video portal, and how it ties together with Verizon's partnership with Comcast and other cable companies. McAdam talked a lot about the idea of subscribers being able to access cable content on mobile devices last year; it will be interesting to see if Verizon is willing to divulge any more details.
The emerging theme I see at this CES is one in which carriers, OEMs and vendors are all hyping services and experiences. This isn't a new thought, but I think it has taken on greater urgency as Apple and Samsung gobble up more market share and profit. Location-based services, intelligent mapping technology, flexible video services, augmented reality and other experiences will rule the day.
"Hardware for hardware's sake seems to be taking a backseat at not just these shows but what creates value in the marketplace," said IDC analyst John Jackson. Next week, we'll find out if companies at the show have embraced the alternative and turn CES into the Consumer Experience Show. --Phil
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