Tech sales soaring as prices drop

Sept. 17, 2006
By JOSEPH M. DELEON News-Post Staff
jdeleon @ fredericknewspost . com

FREDERICK — When sales of flat panel TV sets fell below expectations last year, Gary Yacoubian, president of Gaithersburg-based Myer Emco Inc., believed things would get worse.
    He was wrong.
    The sale of flat panel TVs at Myer Emco Inc. in Frederick increased 113 percent from January to June compared to the same period in 2005, he said. Myer Emco Inc. is a chain of nine audio/video retail stores, including one in Frederick at 1030 W. Patrick St.
    Mr. Yacoubian said an increase in TV sales this year happened because prices have plummeted.
    “A flat panel TV is no longer the frivolous investment it once was,” he said. “A much more broad assortment of people can enjoy these now.”
    “The lower prices have made us have to sell more, but our sales have grown dramatically, up 47 percent in terms of dollar sales,” Mr. Yacoubian said. “That's because more folks are comfortable getting a high definition TV.”
    Nationwide, sales of consumer technology, which include computers, imaging, audio, video and telecommunications, increased almost 5 percent from January to June to more than $48 billion compared to the same time period in 2005, according to a report released this month by consumer and retail information provider The NPD Group.
    Stephen Baker, vice president of industry analysis for The NPD Group, said product enhancements that add value to electronics while lowering the price drives consumer technology sales.
    Holidays also help.
    “In the first half of the year there are numerous holidays and occasions that help boost technology sales, such as the Super Bowl, graduations, Father's Day,” Mr. Baker said. “Based on what we've seen so far, we are expecting strong growth for the rest of 2006 with back-to-school, Black Friday and holiday season consumer technology sales poised to be even more robust than last year.”
    The sales growth of flat-panel TVs accounted for the biggest jump in sales, according to the report. Both LCD and plasma TVs brought in more than $4 billion in sales for the first half of 2006 — a 128 percent increase over the same time period in 2005.
    Mr. Yacoubian said the next big thing in viewing technology is a display capable of more than twice the clarity of high definition TVs. It's called the 1080p standard.
    “We're talking about displays that are even higher resolution than current HD TVs and HD players,” he said.
    Notebook computers, which now consistently outsell desktops, continued their upward trend. Sales of notebook computers topped $7 billion, an almost 17 percent increase compared with 2005, according to the report.
    While some experts predicted sales of digital cameras would slow during 2006, cameras remained one of the largest sellers among electronics. Sales of cameras topped $2.7 billion during the first half of 2006, an almost 9 percent increase over the same time period in 2005.
    The sale of portable digital players, which have seen consistent growth for the past three years, are beginning to slow. Sales still grew 34 percent compared with this time last year, garnering more than $2.2 billion in sales.
    Mr. Yacoubian said portable satellite radios, such as the Samsung neXus XM Satellite Radio, are an emerging market.
    “In terms of satellite radio, we are building a lot of systems that use these as the core of the home or car audio system,” he said.
    Another growing market combines a wireless network and digital audio files. Mr. Yacoubian said most of his customers already have a wireless home network and MP3s.
    “The key is that now that these files exist, they can be enjoyed in lots of new ways,” he said. “It's the ability to enjoy music from anywhere in your home.”
    The system plugs into a home stereo and uses the wireless network to look for any device that has audio files, such as a computer hard drive, iPod or satellite radio.
    A wireless remote allows users to control the system from anywhere in the house.
    “Can you imagine looking at your remote, and being able to play any song in your library,” he said. “That's the future.”