Monday, January 10, 2011

IPad clones to duke it out at Vegas gadget show

What do you call it when you have 120,000 people and an elephant in the room?
The International Consumer Electronics Show, which kicks off this week in Las Vegas.

The elephant is Apple Inc. It won't be at the show this year, but its tablet computer, the iPad, is the most important new product for an industry that needs to once again excite consumers. Sales of the iPad have been strong since its April debut, and the whole industry is trying to mimic Apple's success.

With the iPad, Apple single-handedly cracked the code for the tablet, a device that dozens of manufacturers have tried to take to the masses for two decades, with little success.

Apple itself doesn't do trade shows. When Apple has new products to reveal, such as iPads or iPhones, it stages its own events.

But nearly every other company in the industry will be there for CES, which runs Thursday to Sunday and is the largest trade show of any kind in the Americas. A good many of them will show off their tablets — computing slabs with touch-sensitive screens. Big names expected to do so include Motorola Inc. and Dell Inc.

DisplaySearch analyst Richard Semenza estimated that a hundred tablet models are in development, though not all of them will reach store shelves.

Competing tablets will have a hard time catching up to Apple's lead, at least this year. Certainly, no one managed to do so last year, even though a lot of manufacturers, including Dell, brought out tablets. Samsung did have some success with its Galaxy Tab, but sales didn't come close to the iPad's.

Apple sold 7.4 million iPads through September, in the device's first six months on sale. That means they're already outselling Apple's Mac computers, but not iPods or iPhones.

Analyst Shaw Wu at Kaufman Bros. believes Apple sold an additional 6.1 million iPads in the holiday quarter, and there's every indication it was a popular holiday gift. Even some retailers that don't normally sell electronics, including TJ Maxx, carried the iPad.

Apple's would-be competitors include Motorola, which has been hinting that it will show off its first tablet at the show. Dell and Acer Inc. are also expected to show tablets. Microsoft Corp. CEO Steve Ballmer probably will touch on tablets in his keynote speech Wednesday.

Sales boost needed

The electronics industry's need for a hot new product is especially strong this year. Overall, the recent holiday season was the best for retailers since 2007, but electronics sales were up just 1.2 percent from the previous year, according to MasterCard SpendingPulse, which tracks spending across all transactions, including cash. They're still down 10 percent from pre-recession levels.

For about five years, the industry has been bolstered by Americans rushing out to buy flat-panel TVs. Now, that rush is slowing, as 61 percent of households already have such sets, according to Leichtman Research Group.

Meanwhile, sales of other products that have driven growth, such as GPS units, picture frames and digital cameras, have tapered off. The people who really want them already have them, while the rest make do with their cell phones instead.

Other technologies promoted at CES in recent years have been met with tepid consumer interest.

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