2017 CTA Report Projects Record Revenues, Growing Emerging Tech Demand The Consumer Technology Association reports that consumer enthusiasm for both emerging technology and resilient mature categories is exceeding expectations.By RS Staff Published: July 20, 2017 ⋅ Updated: April 15, 2019 The Consumer Technology Association reports that consumer enthusiasm for both emerging technology and resilient mature categories is exceeding expectations. The CTA’s research suggests the U.S. consumer technology industry will see an estimated 3.2 percent revenue growth in 2017, earning $321 billion in retail revenues ($251 billion wholesale). The latest edition of CTA’s semi-annual industry report, U.S. Consumer Technology Sales and Forecasts, also projects drones, OLED TV and virtual reality (VR) technology will each cross the $1 billion revenue milestone for the first time this year. “Driven by consumer demand for the products we already know and love, as well as new, innovative technologies, revenue growth in the consumer technology industry is exceeding expectations,” said Gary Shapiro, president and CEO, CTA. “Not only are breakthrough technologies changing our lives for the better – such as drones delivering medical supplies to remote areas or the use of VR in patient care – tech is also a key driver of the U.S. economy, outpacing GDP growth, and reinforcing America’s role as a global leader in innovation.” CTA’s semi-annual report serves as a benchmark for the consumer technology industry, charting the size and growth of underlying product categories. The CTA consensus forecast reflects U.S. factory sales-to-dealers for more than 300 consumer tech products. Among categories tracked by CTA’s forecasts, U.S. sales of connected devices are projected to reach 635 million units in 2017 – a record high total and six percent year-over-year increase from 2016. The total wearables market – including fitness activity trackers, other health and fitness devices, “hearables”, over-the-counter hearing devices and smartwatches – is expected to reach sales of 48 million units in 2017 (nine percent increase) and earn $5.6 billion. Harnessing the Internet of Things (IoT) to provide personalized home automation experiences, smart home tech is one of the most popular emerging tech categories. The CTA projects sales in the category—including smart thermostats, smart smoke and carbon monoxide detectors, IP/Wi-Fi cameras, smart locks and doorbells, smart home systems, and smart switches, dimmers and outlets—to reach 27 million units in 2017 (a 50 percent increase over 2016), earning $3.3 billion (a 48 percent increase). 4K UHD TVs are one of the industry’s fastest growing segments, the transition to which is far outpacing the transition to HDTV, with unit sales forecast to hit 16.7 million units (59 percent increase) generating $14.6 billion in revenue (a 45 percent increase). Voice recognition technology is one of the defining trends of 2017 and these devices continue to gain popularity. 2017 unit sales projections for voice-controlled digital assistant devices – including Amazon’s Echo, Google Home, and expected new market entrants like the Apple HomePod – are projected to reach 11 million units (53 percent increase) and generate $1.3 billion in revenue (a 22 percent increase). Shipments of VR headsets are projected to grow to 5.3 million units (79 percent increase) and $1.3 billion in revenues (a 43 percent increase). Total drone sales are expected to reach 3.4 million units (40 percent increase) and $1.1 billion in revenue (44 percent increase) for the first time in 2017. CTA’s forecast delineates U.S. drone sales for units below and above 250 grams, the FAA’s division for mandatory drone registration: Shipments of drones below 250 grams are expected to reach just over two million units, while drones above 250 grams will surpass 1.3 million units shipped. “More and more consumers are adopting connected products at a rapid pace, with several categories such as drones, VR and OLED TVs surpassing significant revenue milestones just a few years since their market entry,” said Steve Koenig, senior director of market research, CTA. “At the same time, core categories, such as smartphones and laptops, continue to experience unit and revenue growth, demonstrating resilience in mature technologies. We believe the anytime/anywhere access to information and each other that connectivity enables is a driving trend of our time.” The top five revenue categories continue to contribute just over half of total industry revenue (53 percent) in 2017. Despite some slight revenue declines, unit shipment increases demonstrate continued growth in these categories. Smartphone unit volume is projected to grow three percent to reach 185 million smartphones shipping in 2017, with revenues expected to reach $55.6 billion (a two percent increase). In 2016, LCD television enjoyed record unit shipments but 2017 will initiate a period of slight declines with unit volume at 40 million units (a one percent decrease) and $18 billion in revenue (also a one percent decrease). The CTA projects that the future category growth will be driven by 4K UHD, high dynamic range, and OLED display technology. Adoption of tablets has leveled off and replacement cycles have slowed. CTA expects sales of Tablets will decline in 2017 to 59 million units (five percent decrease) and revenues of $16 billion (an eight percent decrease). In 2017, the laptop market, including commercial and consumer channels, is expected to sell 48 million units, up two percent over last year, and earn $28 billion in revenue (a one percent decrease). Convertible models represent a possible area of growth. Joining the top five largest revenue hardware categories for the first time, factory-installed automotive technology, from driver-assist features to entertainment systems, is projected to contribute $15 billion (a 12 percent increase) in revenue. This is likely a result of overall automotive sales performing well, a rising tide of tech integrated into all vehicles, and the increasing density of tech installed in each vehicle. CTA publishes the U.S. Consumer Technology Sales and Forecasts twice a year, in January and July, reporting U.S. factory sales-to-dealers. It was designed and formulated by CTA to be a comprehensive source of sales data, forecasts, consumer research and historical trends for the consumer technology industry. Multi-year projections cannot account for unpredictable factors such as changes in trade laws, interest rates and federal policy. SubscribeFor more stories like this, and to keep up to date with all our market leading news, features and analysis, sign up to our newsletter here.