Content provided in partnership with

Kagan's Column: Holidays 2005, a Portable Feast

You may be savoring that upcoming plate of turkey and yams, but I've got my eye on even more palatable holiday offerings-that great gorging on consumer electronic devices that starts the day after Thanksgiving and runs until after Christmas.

Despite serious concerns about the economy, and plans to give fewer gifts, families surveyed by Consumer Electronics Association say they'll spend 14% more dollars on all holiday items this year. That means they're either buying themselves gifts or, since CE prices are always in a long-term decline, they're going after higher-ticket items. I think it's both. Indeed, the Top 10 items on the wish list of adults in the latest CEA survey are a bit more expensive than blenders and toasters. In order, they are:

Most Popular Articles in Technology: An overview of continuous data protection; Why all those current ratings?; Many countries now have a mobile penetration rate above 100%, report says; The Tata Group's big telecom gamble: VSNL's recent acquisition of Tyco ...; MEASURING BANK BRANCH EFFICIENCY USING DATA ENVELOPMENT ANALYSIS: MANAGERIAL ...; More »

MP3 player, plasma TV, digital camera, laptop computer, 27+inch color TV, desktop computer, videogame system, high-definition TV, DVD recorder (first time mentioned) and home theater. Asked what they want most in life, moms & dads said (in order): peace/happiness, clothing, good health, a computer, and, tied with money, a big-screen TV. If you believe that television is dying, I rest my case. A more important issue: Who benefits most, other than Samsung and Best Buy, from this deluge of devices?

Without doubt, Apple's iPod and other brands will be the biggest hit of the holiday binge. A total of 28% of those surveyed will buy an MP3 gift, and that number soars to 57% of what CEA calls "TechFirst" families, better known as early-adopters. CEA pegs MP3 penetration at 15% of households, with a potential to rise to 55%. Flat-panel TVs, now at only 7%, appear targeted to eventually go to 66%. HDTV is at 21%, heading one day to 71%.

Beyond retail sales, new devices are changing the geography of media consumption. This is why there's so much talk about wireless communication.

The four most popular gifts this year-MP3, digital cameras, videogames and cordless phones-are all portable objects. Four of the second five-portable CD players, game accessories, cell phones and laptops-are all part of the increasingly mobile world.

CEA says there are 152 million roaming digerati, 70% of U.S. adults. And they're serious about using their new companions: they'll spend more than $8 billion in the next 12 months on mini-screen content, although only 16% of users will pay by subscription. Still, we're talking about 24 million people.

Note here that competition for consumer attention inside the home is accelerating at precisely the moment when so much usage is moving outside. Fortunately for the home video battlers, there's enough difference between the way devices are used, the demographics of those using them, and the new array of in-home hardware, to insure stability of old-media markets even while new ones expand. The same doesn't hold true for valuation multiples, which explains why Rupert Murdoch, defending News Corp's performance at the annual meeting in New York October 21 said, "all media stocks have been completely out of favor for the past 12 months. We are in a media bear market." True, but that won't stop you from recording your favorite Thursday night program, so you can enjoy Thanksgiving dinner.

Analyst/investor Paul Kagan is Chairman/CEO of Kagan Capital Management, Inc. in Carmel,Calif. He owns shares of News Corp. Information in his columns is not intended to be a recommendation to buy or sell securities.

Technology Industry

Kagan's Column: Holidays 2005, a Portable Feast

Cable World, Nov 7, 2005

Find Research Guides for:

Find Featured Titles for: Home & Garden

Most Popular Articles in Technology

Most Popular Publications in Technology