INTERVIEW: CTA’s Gary Shapiro on the future of CES and why British tech innovation needs a boost

After celebrating a record breaking CES 2016 trade show as well as a second successful year for CES Asia, the Consumer Technology Association is going from strength to strength.

PCR editor Dominic Sacco sits down with the Consumer Technology Association’s president and CEO Gary Shapiro to discuss what’s next for tech, why Britain is falling behind France in terms of innovation, and the future of CES…

You held your second annual CES Asia event in May. What was the thinking behind launching a separate CES event in Shanghai?

Did it come from demand from partners and the industry? Absolutely. China didn’t have a major event for consumer technology. The reason we started the event is because major American, Chinese and European companies asked to have an event in China with the quality of CES’ Vegas show. So we did – and it’s proven to be very successful.

We’ve gone from two halls in 2015 to four halls this year, and we have attracted an international audience of 30,000 attendees, over 350 exhibitors, about 1,000 media, 50 conference sessions and 15 product categories.

Our only competitor, if you will, is CES in Las Vegas, which is so large and successful – this will be our 50th year. We’ve had 50 years to build up CES in Las Vegas and now we’re in our second year with CES Asia. So it’s a much smaller event by comparison, but the conferences and keynotes are still pretty comprehensive. We’ve got a lot of good feedback from those that exhibited and those that attended.

Why should companies visit the Asia show rather than Las Vegas?

They shouldn’t go unless they care about reaching the Asian population. It’s a pathway to Asia, just as CES is a pathway to the world. There are great shows in Asia but they’re country-specific shows. The Japan Electronics Show is a quiet show but they have some great technology there. The Korea Electronics Show has a lot of manufacturing. And there’s the Hong Kong Electronics Show. We don’t really see those shows as competitors – we have different areas we’re focusing on and we don’t overlap.

CES Asia is different to CES in Vegas. It’s a lot of work. It’s a different culture. We’re continuing to learn, but we have good partners in China.

“There’s no question that the PC market is maturing. Companies are naturally looking for the next big thing.”

We focus the event on two categories: one is well-known brands and the other is innovative products. So we don’t have 30 companies showing iPhone cases for example. We also have a new startup park called Eureka Park. The French brought 20 companies there. There was a whole drone area.

And we’re seeing some of the major categories we see elsewhere in the world – the Internet of Things, drones, 3D printing, mobility, wireless, [smart] automobiles…

Those categories have grown in recent years, as manufacturers branch out from their traditional PC focus. How challenging is this shift for them?

It’s a very difficult time for companies because product mixes are changing rapidly. There’s no question that the PC market is maturing. And even the shift into tablets and smartphones has slowed.

So companies are naturally looking for the next big thing, because innovation breeds sales and growth. The reality is the products we make last a long period of time, and unless consumers have a reason to replace them… The truth is that consumers have got so comfortable having their device with them, that the importance of PCs has changed. The challenge for a lot of companies is not only the mix of products, but being on every product.

Any business of any size has to realise they should be rapidly moving to a mobile-everywhere environment. And what looks good on a computer screen may not look good on a tablet or a smartphone – or even on your wrist. And that is a phenomenal change that is really shaking up the rest of the business world – not just in our industry.

Some major PC and tech retailers in the UK have embraced the Internet of Things. But the smart home has not hit the mainstream. Why do you think that might be?

There are a lot of estimates out there and major changes in technology that don’t happen as quickly as some people say they will.

Nobody goes out and says: “I want to buy an Internet of Things.” They want some solution – they want to know if their child or their pet is okay while they’re not there, or if their home is secure. They have to be convinced, they have to be entertaining and it’s an opportunity.

Our job is to make sure people learn about it – that they go into the stores, they go online and it’s talked about in the media, so people see the value and the benefits. Sometimes it’s helped along by external factors, for example insurance companies could offer a benefit if you have a security system.

Would you consider launching a CES event in the UK or Europe?

We used to say we wanted an event in every continent, and we do have a press event in London every year. We’ve had an event in Paris now for four years, which is growing rapidly. It has about 50 exhibitors. In fact, I was talking about it recently with the British Minister responsible for technology and culture, about how France has such a major presence at CES. It has several thousand people and over 100 exhibitors.

The bottom line of it is–I think Britain needs to step up its act in terms of its innovation presence, because there’s a huge innovation push here but what we see is France leapfrogging Britain in terms of investment, innovative products and senior level government focus.

There’s Tech City in London, there’s definitely a desire but there’s not the marketing presence that’s needed.

“Britain needs to step up its act in terms of its innovation presence.”

We had 45 exhibitors from the UK at CES in Las Vegas this year. That’s 45 out of about 3,800, so that’s a little over one per cent of our exhibitors. By comparison, we had well over 100 visitors from France. We had a big jump in attendance at CES in Las Vegas this year though. We had 2,600 attendees from the UK, up from 1,745 a year prior.

I would’ve thought five years ago that the UK would have had high exhibitor levels, but it’s totally shifted.

How was CES in Las Vegas this year and what are your plans for CES 2017?

CES 2016 was off the charts, it had the biggest footprint ever and most news covered by social media measures and more traditional measures.

We had 3,800 companies exhibit and a huge number of product introductions. All signs are looking great for 2017 – we’ve virtually sold out of space. We have companies wanting to get in that can’t. And we’re looking at some of the growth in categories like drones, 3D printing and virtual reality. Major automobile companies are also starting to use us as a place where they introduce cars as technology.

What are your thoughts on the tech market and where it’s going?

We’re on the cusp of so many great technologies now – we’re exploding in the five or six new categories all at once. You have virtual reality, ultra 4K HD which is real and dramatic, and you have drones which are off the chart. And then you have the Internet of Things and smart cars, which are more out there, in a sense, but that is the future. It’s just a question of when we get there.

But companies are still facing challenges in the retail space. The number of stores is shrinking and it’s difficult to be a retailer. Consumers with Amazon Prime have gotten away from going into stores, which is a shame because it doesn’t allow them to discover new technology as much. It’s unassisted selling – and there’s a concern there. We’ve always been dedicated to the proposition of the independent dealer – that’s one of the things our association believes in. The independent dealers are necessary to help introduce new technologies. But it’s a challenge, because of pricing pressures on independent dealers, and they always push towards bigger conglomerations.

Obviously the other big pressure is the economic side, to the extent that if the economy is doing well, the industry is likely to do well.

The third pressure is innovation. Sometimes, when something new happens like 4K Ultra HD, the pricing pressures bring it down so low very quickly. So the advantage we have is there are so many new technologies coming, some of which require installation, some of which require assisted sale.

Also, we have an ageing population with kids that are unable to take care of them – and tech is going to solve some of those problems. We know there are things coming in our own healthcare that will be increasingly viable in the near future. The question is whether firms and retailers will position themselves to take advantage of that.

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