Television sales in the United States are expected to “taper off” in 2019, with LCD TVs showing declines as 4K Ultra HD, 8K and OLED-based displays register growth, according to mid-year forecasts released Monday by the Consumer Technology Association (CTA).

According to the CTA’s mid-year edition of its biannual U.S. Consumer Technology Sales and Forecasts report, overall television sales, which enjoyed two years of record revenue and unit sales growth, will decline somewhat this year, although the category remains “the centerpiece technology in many American homes.”

Overall, factory shipments for the total TV category are forecasted by the CTA to decline 1% to 38.8 million units while registering a 9% decrease to $21.4 billion in factory dollar revenue, the report said.

“Upgrades will be driven by big screen models and sets featuring 4K UHD resolution and HDR technology. This year 4K UHD sets will account for 17 million units (7% increase) and almost $15 billion in revenue (9% decrease),” the CTA said.

Just keep in mind that sales for 2018 were unexpectedly higher than were originally forecasted, and could very well do the same again in 2019.

Looking ahead, inaugural shipments of 8K UHD TVs in 2019 will reach $734 million in revenue and 175,000 units, the association predicted. At the same time televisions based on Organic Light Emitting Diode (OLED) display technology “will surpass 1 million units this year, rising 30% from 2018 numbers. The CTA said the OLED TV category should see “double-digit growth through CTA’s forecast horizon of 2023.”

The big winners among related categories this year will be the rising demand for streaming services, artificial intelligence (AI)-enabled emerging devices and in-vehicle technology. The CTA said these areas “will help drive the U.S. consumer tech industry to a record-breaking $401 billion in retail revenues in 2019 – 2.2% growth year over year.”

“Enthusiasm for AI-powered technologies is skyrocketing – more consumers are discovering for themselves how tech innovation can change their daily lives for the better,” stated Gary Shapiro, president and CEO, CTA. “And with 5G delivering the faster connectivity we’ll need for anytime/anywhere streaming, smarter home robotics and more advanced vehicles, consumer excitement will only grow, but unnecessary tariffs – taxes paid by American consumers and businesses – threaten to slow down our nation’s economic momentum.”

The CTA expects consumer spending on software and services (including music, video and gaming services) to grow 14% in 2019 reaching a new high of $75.6 billion. This is being driven by cloud-based subscription services supported across a range of devices.

Live TV streaming and exclusive content through subscriptions will push consumer spending on video streaming services to $17.7 billion in 2019, up 25%. Meanwhile, on-demand music streaming services including Apple Music, Pandora and Spotify will cross $8 billion in revenue, up 33% as increased adoption of products such as wireless earbuds and smart speakers drive more music subscriptions, the CTA said.

Video gaming, too, is expected to see a revolutionary shift toward cloud-based streaming models, subscriptions and growing in-game purchases. Combined this will push year on year growth of 11% for the gaming software and services category to $38.9 billion in revenue in 2019, CTA market research said.

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The CTA picked out factory-installed, in-vehicle technology to see the largest revenue increase of any tech category in 2019. This segment should increase “over $1 billion dollars year-over-year to reach $17.6 billion (8% increase over 2018),” the CTA said.

Advanced driver-assist safety features such as blind spot detection, adaptive cruise control, lane keeping assist and collision avoidance systems will continue to drive sales of both factory-installed and aftermarket vehicle technology alike, the CTA believes.

Among newly emerging technologies, the CTA identified the smart home as a significant driver of new review. The CTA said home safety and monitoring products are driving growth in the category.

“CTA expects smart home sales – including Wi-Fi cameras, smart thermostats, smart smoke and carbon monoxide detectors, smart locks and doorbells, and smart switches, dimmers and outlets – to reach 28.6 million units (19% growth) and $4.5 billion (16% increase),” the association said.

Another big area will be smart speakers, which will be helped by the continued rapid adoption of AI-enabled, voice-controlled smart speakers including Amazon Echo and Google Home, and increased voice integration in other devices such as TVs, soundbars and smart home devices, smart speaker sales will level off in 2019.

The CTA said smart speakers remain a category to watch, forecasting 35.2 million units to sell, up 1% over 2018, and $3 billion in review, also up 1% for 2019.

Other areas of interest include: home robots that perform chores such as vacuuming, lawn mowing and floor cleaning. These represent another AI-enabled category that should see double digit year-over-year growth. CTA said it expects the category to sell 3.6 million units, a 12% annual increase, and earn $1.2 billion in revenue, up 19% from the prior year.

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Wireless earbud sales will also spike from the emergence of Apple AirPods and Beats by Dre Powerbeats Pro, selling nearly 16 million units in 2019, up 45% from 2018 to approach $2 billion in revenue, for a 46% increase. CTA said it is projecting double-digit growth for the category over the next few years, as consumers pick premium audio experiences featuring true wireless technology.

Smartwatches will see revenue increase 19% in 2019, reaching $5.4 billion. The CTA expects smartwatches to sell 20.1 million units, up 7% over last year to lead the wearables category.

As for laptops, the CTA said the category will enjoy a spike from the growing demand for cloud-based and convertible models. The U.S. laptop market is forecasted to sell 51 million units, up 2% over 2018, and earn $32 billion in revenue (up 3%) this year.

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Among the industry’s revenue drivers will again be smartphones, the largest tech category. The CTA said smartphones are now owned by 91% of U.S. households. As a result, the replacement cycle is lengthening and smartphone units are expected to decline for the first time in 2019, reaching 165.5 million units—a 2% drop–and earn $77.5 billion dollars in revenue, down 2% decrease. 

Looking ahead, 2019 marks the launch of the first 5G smartphones. This year, CTA said it expects the 5G-enabled devices to reach 2.1 million units sold and generate $1.9 billion in revenue.

By Greg Tarr

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