Skyrocketing popularity of streaming services and wireless earbuds along with 5G connectivity and artificial intelligence (AI)-enabled devices will drive revenue growth for the U.S. consumer tech industry to a record $422 billion in retail revenues in 2020 – nearly 4% growth over last year, according to a new Consumer Technology Association (CTA) report.
CTA’s twice yearly U.S. Consumer Technology Sales and Forecasts report reflects U.S. factory sales-to-dealers for 300+ consumer tech products and related software and services. New for 2020, CTA’s forecast also provides an overall number for digital health devices including smartwatches, fitness trackers and connected health monitoring devices such as blood pressure monitors and smart scales. The digital health category is projected to sell 64 million devices and total $10 billion dollars this year.
“More and more consumers are embracing the faster connectivity, advanced intelligence and seemingly infinite content that technology offers today – pushing consumer technology industry revenues toward another record-setting year in 2020,” says Gary Shapiro, president and CEO, CTA. “We’ll see advancements in 5G connectivity and AI play out across the CES 2020 show floor this week – from digital health to self-driving vehicles and smart homes – vital technologies that are changing our lives for the better.
Spending on software and streaming services (including music, video and video gaming) is projected to reach a new high of $81.2 billion in 2020 (11% growth over last year)
° Video: Award-winning original content and more big entrants to the video streaming wars will push consumer spending to $24.1 billion in 2020, up 29%.
° Music: On-demand music services including Apple Music, Pandora and Spotify will total $9 billion in revenue, up 15%, with room to grow as more and more consumers adopt smart speakers and wireless earbuds.
° Video Gaming: Growing in-game spending and subscribers will push the video game software and services category to $38.3 billion in revenue this year, up 5%.
° Wireless Earbuds: Devices such as Apple AirPods and Samsung Galaxy Buds will help propel the category in 2020 to nearly 67 million units in 2020 (up 35%), earning $8.2 billion in revenue (up 31%), after a breakaway year of sales in 2019.
° Smart home: Safety is a key driving force in the smart home category. CTA expects smart home sales – including smart doorbells and locks, Wi-Fi cameras, smart thermostats, smart smoke and carbon monoxide detectors, and smart home security kits – to reach 35.2 million units (15% growth) and $4.3 billion (4% increase).
Smart speakers: Consumers are upgrading their smart speakers, such as Google Home, Amazon Echo or Apple HomePod, to voice-enabled devices with a display screen. Unit sales are projected to reach 39 million units sold (up 5% over last year) and $4.2 billion in revenue (14% increase) in 2020.
° Smartphones: After a dip in 2019, smartphones will recoup losses with an uptick in 5G-enabled smartphone shipments this year. Smartphones are projected to reach 166 million units (2% increase) and earn $79 billion dollars in revenue (up 3%) in 2020. 5G smartphones will hit their stride, with 20.3 million units sold (a 12x growth spurt over last year’s initial introduction) and generate $15.3 billion in revenue (10x percent jump), with the build out of U.S. 5G capabilities.
° Laptops: Maintaining their lead as the most popular personal computing device, nearly 53 million laptops will ship in 2020, up 1% over last year, and they will earn $33.3 billion in revenue (up 1%).
° Televisions: TVs continue their reign as the flagship technology in many U.S. homes. Overall, TV manufacturers will ship 40.8 million units in 2020 (2% increase) driving $23.4 billion in revenue (flat with 2019), as new TV features drive interest for consumers. Replacement upgrades will be driven by bigger screens and TVs featuring 4K Ultra High Definition (4K UHD) resolution and high dynamic range (HDR). In 2020, 4K UHD sets will account for 25 million units (12% increase) and $17.6 billion in revenue (2% increase). And 8K UHD TVs will cross the one billion-dollar milestone ($1.6 billion) in revenue, selling 504,000 units.
° In-vehicle tech: Factory-installed in-vehicle technology will grow by 6% to $18.5 billion in revenue in 2020 as autonomous safety and entertainment features in new car models pave the way toward more revenue growth. More manufacturers are including advanced driver-assistance systems (ADAS) features such as automatic emergency braking systems, active lane keeping and more.