US consumer tech revenues to rebound in 2024 – CTA

After two years of decline, US consumer technology spending is expected to return to growth in 2024, the Consumer Technology Association (CTA) finds in its latest industry forecast.

Overall US consumer tech industry retail revenues in 2024 are slated to rise 2.8%, to $512 billion, reversing some of the declines seen during 2022 and 2023, the CTA said in its new forecast – released just days before the organization hosts CES 2024 in Las Vegas.

(Source: CTA 2024 U.S. Consumer Technology Industry Forecast)

The big driver?

"First and foremost, we expect 2024 to be an onramp to an upgrade cycle of devices purchased during the pandemic," Rick Kowalski, senior director of business intelligence at CTA, said Thursday on a press call. "Retailers were able to successfully correct their inventories, readying themselves for new device inventory in the new year."

Kowalski said CTA expects that onramp to include devices such as smartphones and laptops that are due for upgrades or replacements in the coming year.

Within that broad category, hardware revenue is also set to return to growth, with the CTA expecting sales to rise 2.3% to $348 billion in 2024. 

However, sales of new televisions will see limited growth in terms of both units and revenues and will reach a general state of "stability," Kowalski said.

CTA expects 40.9 million TVs to ship in the US in 2024, up about 1% from 2023. Revenues in the category are expected to be flat, at about $17.7 billion. However, CTA does expect to see some growth in sales of OLED (Organic Light-Emitting Diode) TVs, which feature better image quality and contrast than QLED (Quantum Dot LED) TVs. CTA sees sales of OLED TVs rising to 3.2 million units this year versus about 2.7 million in 2023.

Year of the 'megabundle'

CTA predicts that 2024 revenues for software and services, which include segments such as gaming and streaming, will rise 3.8%, to $163 billion.

Within that category, Kowalski said CTA expects 2024 to be the year of the "megabundle," noting that the organization's data shows that Gen Z consumers have nine subscriptions on average while millennials have eight on average.

Broadband and other service providers offering discounts, perks or promotions related to service bundles are helping to drive that trend, he said. Such offers save consumers money and simplify the billing process while expanding the exposure of some services to new audiences, he added.

Examples of that emerged just this week, with T-Mobile adding Hulu to its lineup of complimentary streaming service add-on options that also include Apple TV+, Netflix and MLB.TV. Charter Communications, meanwhile, is now offering the ad-supported version of Disney+ at no added cost to customers on most of its pay-TV packages, and will be doing the same soon with ESPN+ for video customers who take Charter's new sports tier.

Tied in, overall streaming revenues are expected to rise. CTA expects spending on video streaming to increase 4%, to $48.3 billion in 2024. Audio streaming service spending is also expected to climb 4%, to $13.9 billion.