In A Gadget-Light Year, CES Pitches A Connected, Mobile World
After a 2021 show that was all-virtual due to the COVID-19 pandemic and a 2022 in-person edition which drew only around 44,000 attendees thanks to the Omicron variant, CES 2023 looks to be far healthier this year. While it’s not yet back to the pre-pandemic levels of 170,000-180,000 attendees, the annual technology exhibition and conference in Las Vegas is expected to draw around 100,000 attendees and more than 3,000 exhibitors this week, according to show organizer CTA (Consumer Technology Association). The show officially opens today and runs through Sunday.
CES 2023 comes amidst specific challenges for the technology industry, including continued supply chain vulnerability and softening demand for semiconductors, as well as bigger economic issues like inflation and the threat of a broad recession. CTA cited those last two factors in forecasting U.S. technology retail revenues of $485 billion in 2023, lower than the $505 billion CTA initially predicted for 2022 as well as the record $512 billion in revenues it said the industry accrued in 2021.
The trade group has subsequently lowered expectations for sales of laptops, LCD TVs, tablets, smartphones and gaming consoles in 2023. It did point to a few areas of growth in consumer hardware devices, including high-end OLED TVs and portable gaming consoles.
CTA noted the industry had enjoyed a surge in consumer technology spending over the past three years due to pandemic, and that the $485 billion number is still “roughly $50 billion above pre-pandemic levels.”
Meanwhile, CTA said major areas of revenue growth in 2023 include:
- Technology services such as gaming and video streaming apps, which CTA said will generate $151 billion in consumer spending.
- Automotive technology, with factory-installed automotive technology revenues rising 4% to $15.5 billion in 2023 and companies like Panasonic and LG increasing battery production for electric vehicles.
- Health and fitness technology, with health and fitness services including fitness subscription services and digital therapeutics projected to rise 9% to $928 million in 2023.
Gadget Debuts Wane
Of course, the historical role of CES as the place to introduce consumer gadgets, particularly TVs and other devices for the living room, has been steadily waning for years. In that vein, CTA has dedicated the new West Hall of the Las Vegas Convention Center to automotive and mobility companies, with more than 300 exhibitors, including the latest in EVs and in-car displays.
Sony, which made a splash in 2022 by declaring plans to make its own EVs, announced before the show that it wouldn’t be revealing any of its 2023 TV sets in Las Vegas. Samsung, the world’s leading TV manufacturer by volume, also didn’t discuss any new TV models in its press briefing. And during the “CES 2023 Tech Trends to Watch” presentation previewing the show on Tuesday night, CTA VP of Research Steven Koenig didn’t touch on TVs at all, focusing instead on enterprise technology and the transformative potential of 5G.
“5G is the first wireless generation that will actually be led by enterprise innovation,” Koenig declared. “5G means faster mobile broadband for consumers, but for commercial, industrial and IoT applications it’s really the greater capacity and ultra-low-latency that is going to unlock so much innovation. And we’re going to see that across this decade.”
Koenig didn’t talk about NextGen TV, or ATSC 3.0, which many broadcasters see as an alternative wireless data pipe to 5G. Neither did Samsung, LG and Sony, the first three set makers to declare support for 3.0 back at CES 2020. The lone set maker to mention it was Hisense, which introduced its first NextGen TV model at CES 2022 and this year detailed several higher-end LCD sets with NextGen TV capability.
LG did introduce some new TV models, including its first wireless OLED TV, the “LG Signature OLED M.” The 97-inch OLED, designed for sleek wall mounting, is only a panel with integrated speakers and a power cord. All of its electronic functions are supported by a separate “Zero Connect” transmitter box, that connects to peripherals like a cable set-top or gaming console and wirelessly transmits 4K video and audio at distances of up to 30 feet away.
LG Global CEO William Cho was also joined on stage by Paramount Streaming President-CEO Tom Ryan to announce that more Paramount streaming content will be coming to LG TVs. That includes the addition of 100 channels globally from Paramount Global’s Pluto TV to the LG Channels content platform, and the inclusion of the streaming app Paramount+ in LG sets on a global basis.
“Today I’m excited to announce that Paramount+ is ready to start its global expansion on LG smart TVs, with the first launch to start today in the U.K. and Ireland,” Ryan said. “Paramount+ will be available in more countries on LG smart TVs soon to follow in the coming days.”
Connecting Homes And Cars
Overall, the big consumer electronics manufacturers spent most of their time Wednesday talking about a connected world of intelligent devices, where smart TVs easily link to smartphone apps to control other devices in the home such as washing machines, air conditioners or security systems. And LG, Samsung and Sony are looking to extend that connected world to the automobile, as all three announced smart car software platforms that would naturally compete with Apple CarPlay and Google’s Android Auto.
LG and Samsung also pointed to digital health and content services as growth drivers, while Sony detailed advancements in its Playstation gaming unit, including a new VR headset as well as the continued adaption of popular games like Gran Turismo into major motion pictures. Andy Sony rolled out a prototype of the “Afeela” four-door EV sedan it has developed in partnership with Honda Mobility, which will be available for pre-orders in early 2025 with U.S. shipments in 2026.
One of Sony’s key technology partners on the Afeela project is Qualcomm, which is providing the “Snapdragon Digital Chassis,” an automotive version of the Snapdragon processing chip used in many smartphones today.
“We are on a mission to really make everyone and everything connected and intelligent, to make every single device intelligent and have high-performance computing,” said Qualcomm CEO Cristiano Amon. “We look at the opportunity to turn the car into a software-defined vehicle that is 100% connected.”
Broadcasters’ CES Roadmap
Anne Schelle, managing director of broadcast consortium Pearl TV, said her CES schedule is chock full of meetings with set makers and other CE manufacturers about NextGen TV. But she wasn’t surprised the big players aren’t highlighting it at CES.
“It’s up to broadcasters to educate consumers on the services that will be available to them on NextGen,” Schelle said. “To them, it’s just another feature on the TV set.”
The biggest news for broadcasters at CES, Schelle said, is actually the announcement late last month that system-on-a-chip supplier MediaTek has now entered commercial production of TV System on Chip (SoC) ATSC 3.0 demodulators. That should help pave the way for other manufacturers to launch high-volume, low-cost NextGen TV sets as well as accessory devices.
“It will be available first quarter and they’ve been working with us on getting it certified and ready,” Schelle said. “That’s huge, because those are the chipset solutions purchased by the Tier IIs, and they do it in a way that allows you to create a lower-cost device.”
Another boost for NextGen TV could come today, Jan. 5, with the planned launch of 3.0 broadcasts in Miami. Boston is expected to light up later this month.
Sixty-six U.S. markets were live with 3.0 broadcasts as of Tuesday, according to ATSC. In its CES booth the standards body is discussing its efforts to expand 3.0 adoption internationally and demonstrating set-top and USB receivers that can be used to upgrade existing smart TVs to NextGen TV capability. Sponsors include Gaian Solutions, Hewlett Packard Enterprise, Pearl TV and Sinclair Broadcast Group.
Sinclair has been devoting a lot of time and resources to the connected car market itself in the past few years, as it sees 3.0 as a natural complement to cellular connectivity for delivering software updates; position, navigation and timing (PNT) data; and various infotainment services. Through CAST.ERA, its joint venture with Korean mobile operator SK Telecom, it began testing 3.0 automotive applications in Korea back in 2019, using 3.0 to deliver broadcast programming and 5G to deliver targeted ads based on GPS information.
Last year, Sinclair reached an agreement with Korean automotive supplier Hyundai Mobis to partner on developing and implementing 3.0 automotive applications in both Korea and the U.S. Hyundai Mobis has developed a windshield antenna and a 3.0 receiver with Wi-Fi gateway capability that allows connected tablets or phones in the car to easily receive the 3.0 programming.
Late last month, Sinclair successfully tested the automotive solution developed with its Korean partners in the Washington, D.C., market. A live 3.0 feed was broadcast from Sinclair’s WIAV with the help of SK Telecom control software. It was received in a Hyundai Palisade SUV equipped with the Hyundai Mobis receiver and several connected tables, with geo-targeted information delivered based on GPS data.
At CES Sinclair is demonstrating several automotive applications for 3.0. One is a fully mobile audio infotainment service that is being readied for consumer trials by several auto dealerships in the Baltimore market. Another is a prototype EV charging kiosk that can receive local content and advertising through 3.0 datacasting, an application that Sinclair aims to commercialize nationally through a partnership with digital signage firm USSI Global.
Sinclair will also be demonstrating how its “broadcast app” developed for 3.0 can not only be received and used by NextGen TV sets getting a 3.0 signal, but also through a station’s 1.0 signal, whether the sets are getting that signal over-the-air or through a legacy cable or set-top box.
The key is the Verance Aspect audio-based watermarking solution that is part of the 3.0 standard but is also designed to be backward-compatible with 1.0. It would allow Sinclair or other broadcasters to offer 3.0’s interactive features, like weather or traffic information or OTT content, without having a live 3.0 signal in the market or without it being carried by pay TV platforms. Aspect is currently included in LG’s NextGen TV sets.
“If the consumer has a 3.0-capable television set that’s supporting Verance, we can convey the information to that 3.0 smart TV watching an ATSC 1.0-derived channel and drive them to the broadcast app,” explained Sinclair SVP of Advanced Technology Mark Aitken. “It also means that for all of the markets that have ATSC 1.0, but don’t have 3.0 live, we can still do and produce the broadcast app and bring value to the consumer.”
One piece of bad 3.0 news this week was the shuttering of Evoca, the fledging pay TV service that blended 3.0 and 1.0 over-the-air transmission with OTT streaming in a hybrid set-top box. Created as a low-cost alternative to traditional pay TV platforms, Evoca launched in 2020 in Idaho and expanded to Arizona, Colorado, Oregon and Michigan using LPTV spectrum and consumers’ broadband connections to deliver 80 channels. The company raised $35 million from strategic investors and netted 10,000 subscribers in total, with a reported churn rate of less than 1%. But it shut down Dec. 31, 2022, after running out of money and being unable to raise additional capital, which Evoca CEO Todd Achilles said was mostly a matter of bad timing.
“We got this far on $35 million,” Achilles said. “The next natural stage for us was go to more financial investors. But the climate for that is completely on ice, unfortunately.”
Evoca had difficulty securing top content from major media companies given its scale. But Achilles said there was no problem with the 3.0 technology, which provided reliable reception to small indoor antennas that Evoca bundled with its set-tops.
“Without a doubt this kind of hybrid architecture is the best way to deliver video to the home — deliver your core content over the air and then supplement that with other programming over the Internet,” Achilles said. “It effectively gives you infinite capacity on your system, with the reach and efficiency of broadcast.”
Achilles, who worked in the “fiercely competitive” wireless industry before starting Evoca, concedes that high-power broadcasters have been hamstrung by the FCC’s simulcasting requirement on early 3.0 stations. But he also thinks the majority of broadcasters still don’t realize how much potential 3.0 has.
“Broadcasters have a huge opportunity,” he said. “They already had the best spectrum, now they have the best air interface. It’s a matter of putting those two things together to usher in a whole new age of media. The industry has to stop turning the crank and doing the same stuff. Otherwise, they’re going to lose more spectrum.”