Fueled by strong demand for products such as smartphones and streaming services, consumer tech industry revenues are poised to eclipse the $500 billion mark for the first time in 2022, the Consumer Technology Association (CTA) forecasted in its twice-yearly technology trends study.
That projection of $505 billion would represent a 2.8% increase over 2021's totals, according to the study, released Monday in concert with this week's CES in Las Vegas.
"Growth and momentum is still in place" in the consumer electronics industry despite a pandemic that continues to wreak havoc on the supply chain, Steve Koenig, the CTA's VP of research, said in a presentation given Monday night.
While the CTA expects 2022 to be another growth year for consumer tech and hit new revenue heights, the association projects that the rate of growth will taper well below the 9.6% growth rate seen in 2021. "We can't hit these historical highs forever, of course," Koenig allowed.
Drilling a level deeper, the CTA expects hardware revenues to reach $292.9 billion in 2022, up from an estimated $287.8 billion in 2021. That segment will be led by mobile and wireless ($75 billion), computing ($74.9 billion), automotive and mobility ($24.7 billion), smart home tech ($24.2 billion), and video technology ($23.7 billion).
Within that video tech subcategory, the study noted that the proportion of US homes owning 4K-capable TVs reached 52% in 2021, up 16 points from 36% in 2020. Some 71% of US homes owned an Internet-enabled/smart TV in 2021, up from 65% in 2020, according to CTA estimates.
Turning to software and services, the CTA projects that 2022 consumer spending in that category will hit $130 billion in 2022, up from an estimated $122.7 billion in 2021. Subscription services will lead the way with $60 billion in consumer spending, followed by gaming software with $53.6 billion.
Emerging tech trends
The CTA study also took a look at trends in emerging technologies, forecasting that 5G smartphones will pull down revenues of $61.37 billion, up 15% from $53.38 billion in 2021. Meanwhile, 5G smartphones are estimated to make up 62% of all smartphone units in 2021, and rise to 72% in 2022.
The CTA forecasts that consumer spending on 5G home gateways will reach $192 million in 2022, up 48% from 2021's total.
The CTA also expects to see momentum in the augmented reality (AR) and virtual reality (VR) markets, viewing them as "entry points" to the so-called metaverse.
Consumer spending on VR headsets and eyewear is expected to reach $774 million for 2021, down 2% from the prior year. But it's forecasted to rebound in 2022 and hit $1.28 billion. AR headset/eyewear spending is expected to eclipse $78 million for 2021, and jump 175%, to $214 million, in 2022.
"The metaverse is closer than you think," Koenig declared, noting that several building blocks are already in place, such as cloud computing, new 5G networks and improving haptics technology as well as early forms of volumetric video.
The CTA expects the emerging tech category, which also includes electric bikes, sports technology and digital TVs that are HDMI 2.1-enabled, to drive $74.60 billion in consumer spending in 2022, up 19% from $62.54 billion in 2021.
To make the emerging tech list, revenues must surpass $100 million in the coming year, products must see revenue growth of at least 10% in the coming year, and the product must have been introduced to the study/forecast within the past five years.
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— Jeff Baumgartner, Senior Editor, Light Reading