BMI View: In 2013, BMI forecasts that Australian demand for consumer electronics will grow by around 3%, as weaker economic growth is forecast to hit the market over the short-to-medium term. In 2013, the weakness in the job market will frustrate the government's efforts to lift the economy using policies that encourage household spending. Vendors will look to emerging product categories such as ultrabooks, Windows 8 tablets and phones, ultra-HD, smart and 3D TV sets, and LTE smartphones as areas of growth.
Longer-term consumer electronics market drivers include rising incomes, technology innovation such as 4G LTE mobile networks and 3D TV, product innovation such as OLED and ultra-HD TV sets, and government ICT programmes. Smart and ultra-large 3D TV sets, Windows 8 smartphones, ultrabooks and tablets are expected to be consumer electronics growth areas in 2013, while iPhones and Windows Phone 8s are increasingly popular with larger organisations.
Headline Expenditure Projections
Computer Hardware Sales: US$9.5bn in 2012 to US$9.6bn in 2013; 1% growth in US dollar terms. Forecast in US dollar terms flat, but lower-cost ultrabooks and Windows 8 upgrades should help to shore up demand.
AV Sales: US$1.9bn in 2012 to US$2.0bn in 2013; +3% in US dollar terms. Forecast in US dollar terms unchanged, with releases of new products such as large-panel ultra-HD TV sets expected to combat continued price pressure.
Handset Sales: US$5.2bn in 2012 to US$5.5bn in 2013; +7% in US dollar terms. Forecast in US dollar terms unchanged, with new generation of LTE-compatible devices fuelling strong growth in the smartphone market.
Australia's score is 72 out of 100, which puts it at first place in our latest Asia Consumer Electronics Risk/ Reward Ratings table. The country's high country reward and country risk scores means it is ranked higher than Asian giants such as China and India. BMI expects Australia to continue to be one of the region's most important markets and at the cutting edge of trends like 4G mobile and 3D-TV.
Key Trends And Developments
- In the AV sector, Samsung stole a march on LG with the August 2013 launch of its 55-inch KN55S9C Curved OLED TV, which is the first ever OLED TV to be sold in Australia.
- LG launched its 55-inch Curved OLED TV and its 55-inch (55LA9700) and 65-inch Ultra HDTVs in September 2013 (see Competitive Landscape).
- LG has also been active in the smartphone market, launching the Nexus 5 (in collaboration with Google) in November 2013. The Nexus 5 is the first smartphone in Australia to feature the latest Android operating system (OS), Android 4.4 KitKat.
- The growing popularity of Android phones is borne out by statistics which reveal that, at the end of July 2013, the OS held a 64.6% market share in Australia, reflecting a 3.8% year-on-year (y-o-y) increase. The iOS platform from US consumer electronics company Apple claimed a 27.6% market share, up 0.1% y-o-y, while the Windows OS from US software company Microsoft held 5.3% of the market, also up 0.1% y-o-y.
- In December 2013, Sydney, Melbourne and the other remaining areas of Australia switched off their analogue TV network, which means that the country's digital switchover is now complete. This should help stimulate sales of hi-end TVs.
- Also in December 2013, Australian mobile device vendor Aspera launched two smartphones, two feature phones, a 3G-based tablet and a battery power pack. The new products are positioned as being durable and rugged in order to "withstand harsh Australian conditions and tough workplace environments". The products were launched in collaboration with Scholastic Australia, which is acting as the sole distributor.
- US-based research company IDC reported that sales of notebooks, tablets and smartphones in Australia have fallen for two quarters in a row since Q113. The company suggested that the decline could be a sign of device fatigue as the exponential rise of mobile devices results in people becoming bored of them.