Consumer spending on technology will grow by 5.3%, according to a new research from International Data Corp (IDC). The news comes despite the fact that semiconductors and other segments of the electronics industry are struggling in 2019.
Consumer spending is forecast to reach $1.68 trillion this year and is expected to rise to $2.06 trillion in 2023 from both traditional and emerging technologies, with a five year compound annual growth rate (CAGR) of 5.1%.
According to IDC forecasts, consumer technology spending in 2019 will be dominated by traditional technologies accounting for more than half of spending in the forecast. Traditional consumer spending includes smartphones and personal computing devices and that spending will grow slowly with a CAGR of 2.2% during the forecast period.
Emerging technologies — which includes augmented reality/virtual reality headsets, drones, on-demand services, robotic systems, smart home devices and wearables — will represent a smaller percentage of streaming but will deliver strong growth in the next five years with a CAGR of 13.2%, IDC said. Of this, smart home devices and on-demand services will account for roughly 90% of the spending.
"Advances in technology continue to drive what 'convenience' means today and in the future for connected consumers,” said Stacey Soohoo, research manager with IDC's Customer Insights & Analysis group. “Ranging from consumer robots for household cleaning and maintenance to smart lighting or home security/monitoring systems, connected consumers are adopting these solutions in their homes and everyday lives as they go through their own digital transformation."
IDC said that new opportunities are being explored by consumer electronics companies in order to interact with consumers. These include blending digital and physical experiences as well as increasing access to on-demand services from networks, marketplaces, content and other resources in subscription-based form such as Netflix, Hulu, Spotify and others.
Of the consumer spending, 70% will be spent throughout the forecast period with more than half of spending going toward traditional voice and messaging services. IDC forecasts entertainment spending will be dominated by watching or downloading TV, videos and movies as well as music listening and downloading.
Learn more about the research with IDC’s Worldwide Connected Consumer Spending Guide.
