Category Archives: Displays

Tech Predictions 2018

Every year, our analyst teams come together to identify technology trends they see emerging in the coming 12 months. This is a collection of these across a number of different markets.

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PCs
PC sales across Europe are expected to benefit from a return to growth of commercial PCs, driven by faster upgrades to Windows 10 machines across the region and the replacement of an ageing PC base in some countries. PC refreshes will drive growing sales of thin and light ultramobile notebook and hybrid devices, but will also benefit deskbound systems, as a large proportion of commercially installed machines continue to be of this type. Even in 2017, the shift in business desktop sales towards small space-saving form factors presented a growth opportunity, and this is expected to be ongoing in 2018.

Consumer sales are likely to remain challenged as users increasingly hold on to their traditional PCs for a longer period and rely on smartphones for many of their day-to-day tasks. However, sub-segments of this market – including gaming PCs, high-end notebooks and ultramobile devices such as convertible laptops – are expected to continue to grow. While these currently make up a small part of the overall market, they present strong opportunities for revenue and margin growth.

Enterprise Technology
In 2018, cloudification will speed up greatly as services such as IAAS (infrastructure as a service), PAAS (platform as a service) and SAAS (software as a service) are increasingly adopted across the Enterprise sector.

An early consequence, one that has already begun, is a complete redefinition of the traditional market segmentation into server, storage and networking products. As convergence and scalability become increasingly important, enterprise systems will continue their migration from in-house systems to data centres.

Another consequence is the complete change in how products are paid for. In the past, clients purchased individual products with a one-off payment, whereas they are increasingly paying a monthly subscription for cloud licences with, in some cases, the hardware included “for free”.

The huge and increasing success of cloud providers such as Amazon Web services has left us with no doubt about the future of the IT business environment: it is already clear that, within a few years, most processing power (and, as a result, most hardware) will have left the office and migrated entirely to data centres.

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Displays
Desktop monitor sales in 2018 are expected to be slower than this year, following PC-demand trends. On the positive side, however, business-targeted monitor sales may benefit from the PC refresh that is expected in the commercial space. Moreover, the rise of esports will continue to drive revenues, especially those from consumer-targeted high-end monitors. The gaming market serves a still-nascent industry, which has significant room to grow and provides a variety of revenue streams. Therefore, more monitor vendors will shift towards this market and offer a larger number of premium models. Increased demand for specialised features like 4K/UHD resolution, higher refresh rates, wide colour gamut and alternative form factors such as large ultra-wide or curved monitors, will increase average sale prices (ASPs) and margin opportunities.

Digital signage will remain a key driver for large-format displays (LFD). Standalone LCD displays will continue to hold the largest market share; however, videowalls and the direct-view LED technology currently used in various public outdoor applications will start to challenge their position. LFD vendors will direct their focus towards other emerging and untapped areas such as industrial manufacturing and BFSI*, and continue to compete in already thriving markets including the retail space – where LFDs enhance customer experience – as well as the education and corporate arenas. Increased competition between vendors and a greater variety of LFDs will result in more affordable pricing and continue to spur volume sales.
*banking, financial services and insurance

Imaging
Printer hardware sales are expected to contract overall although, due to the ongoing shift towards multifunction and colour devices, some segments are expected to grow in 2018 including multifunction colour laser printers and, at a slower pace, high-capacity business inkjets.

Consolidation in the market and the transition towards a contractual business model continues, so unified platforms, security, digitisation, customisation and automation of those processes via services and solutions hold plenty of opportunities for vendors and their business partners to grow by adding value for their customers and increasing their productivity and efficiency.

In 2017, we’ve seen most vendors refresh their product portfolios and introduce even more reliable, secure devices that use various new technologies and offer lower cost of ownership and higher print speeds. Vendors continue to increase their focus on engaging with channel partners to target SMBs. HP’s acquisition of Samsung’s printing business is now complete and the company has started shipping its new A3 products. It is expected that sales of these will accelerate and increase competition in the A3 copier market – a space to watch in 2018.

3D Printing
Industrial space
HP will lead the way in seeing if industrial 3D printing of plastics can turn the same corner as metal 3D printing: away from being used just for prototyping and into manufacturing. HP is also to introduce a new technology in 2018 through which it will begin to set its sights on metal 3D printing.

As the other new kid on the block, the very visible and recognisable brand GE continues to gain share and will help push 3D printing even more into the mainstream and grow the market. GE acquired two of the top companies making industrial metal 3D printers last year and will carry on championing the technology internally as well as sell their printers to others. Their use of metal 3D Printing to make real jet engine parts continues to be the “poster child” demonstrating how 3D printing can disrupt supply chains and the $12T global manufacturing market. In 2018, they will push the boundaries further in aerospace as well as in the automotive and healthcare industries.

After seeing fewer printers ship worldwide each year for the last few years, the industrial side of the market will move back into growth thanks to new technologies (such as from Carbon) and big brands (HP, GE, Deloitte, etc.).

During 2018, we will see the emergence of a new class of low-end industrial metal 3D printing machines. While these are, of course, not for the masses (“low-end” in this context still means ~$150k), this new class includes $1M machines that will allow more companies to experiment with 3D printing in ways that were previously out of reach for most of them.

Desktop space
While they have not yet become a “consumer” good, desktop 3D printers have continued the unfettered growth in shipments that has been seen since the market began – it is projected to reach +39% by the end of 2017 and to continue into next year. Familiar brands, such as Kodak and Polaroid, will come to market in some regions, but this side of the market will continue to be dominated by companies like Monoprice, XYZprinting, Ultimaker and Formlabs that have a strong presence in 3D printing but are mostly unknown outside the sector.

This class of products has traditionally been defined simply as printers selling below $5K. However, growth in this sector means further refinement and stratification is needed to follow the market and the $2,500 barrier is now used to define this low end. In 2017, a new professional space emerged containing products in the $2,500 to $20,000 range (consisting of both higher-end desktop 3D printers and lower-end industrial printers). During the first half of 2017, this class grew by 64% and strong growth is also projected for 2018.

Virtual Reality & Gaming
Gaming looks to continue its healthy growth next year, with help from spectator-friendly formats such as streaming and esports – both of which provide sponsorship opportunities –gaining mind share among younger tech-savvy consumers. The recent upset over microtransactions, brought to a head by EA’s mis-steps on Star Wars Battlefront II, are symptomatic of gamers’ growing unrest about business practices they perceive as predatory, so expect rebalancing in 2018. This is unlikely to significantly depress profits but may, in the long term, lead to a healthier gaming ecosystem.

The push for 4K gaming consoles is likely to encourage an increased focus on the same potential in gaming desktop PCs, driving both display and GPU sales. Meanwhile, the recent surprise collaboration between Intel and AMD to produce integrated chips with high-end graphics capabilities feeds well into the already growing gaming laptop market, so expect the emergence of more thin, light and powerful laptops targeted at gamers.

On the VR front, 2017 ends with many new contenders entering the market and established brands teasing new hardware and this means 2018 will be a year of fragmentation for VR in the west. Whether any of these will catch the attention of the mainstream will depend on various factors, although Oculus’s imminent, lower-priced, Go is likely to be a firm favourite. As prices for high-end headsets fall and more big budget games are released, gamers are finding it increasingly easy to justify VR purchases. With luck, this will fuel a virtuous circle for both consumers and content producers.

Also, expect to see a steady flow of interesting bespoke enterprise VR applications next year, but don’t hold your breath for a single stand-out business headset or killer application – unless Magic Leap’s mysterious headset manages to make it to market and live up to the promises and hype.

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Retail
Mobility will continue to gain importance and be a key success factor for retailers. Current estimates indicate that more than 50% of purchases involve the customer using a mobile phone for search, research or purchase. With online activity continuing to rise, retailers must optimise their websites for mobile in order to engage consumers early and often in their purchase journey.

Consumer expectations for omnichannel options continue to rise. The fastest-growing retail option is click to purchase and collect in store. Click and collect now accounts for more than 30% of sales in many stores, and is rising across retail in Europe. A critical success factor is the accuracy and efficiency of the collection process, with more stores having dedicated collection areas. More retailers will also collaborate with distributors for drop shipments in order to extend product range, and enable fulfilment to travel the last mile to the customer’s door.

Retailers are making up for declining unit volume sales through selling more premium devices: gaming PCs, 2-in-1 notebooks and ultramobile notebooks. A key to selling a premium mix is leveraging stores to create an experience consumers cannot get online. Successful retailers are moving beyond products and selling a larger, more profitable market basket by focusing on solutions and services that are not available online.

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Tech Predictions: 2017

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In 2017 European PC sales in the business segment are likely to benefit from a gradual pick up of Windows 10 refreshes. In Western Europe in particular, the commercial PC segment is expected to also benefit from the need for enterprise mobility solutions which will be a co-driver in sales of both notebooks and mobile 2-in-1 products.

The consumer PC segment is expected to remain more challenged across Western Europe. There is a possibility that component shortages, which impacted product availability in 2H 2016, will lead to price increases in the first half of 2017which could affect demand. However, on a positive note, the market is likely to benefit from continuing high demand for gaming PCs. While this segment remains small in terms of volume, new technologies – including virtual reality – will also drive growth that will have a positive effect on revenue and margins.

From a wider, macroeconomic perspective, PC sales in a number of EMEA countries are likely to continue to be affected by uncertainties including currency fluctuations and political instability.
Marie-Christine Pygott, Senior Analyst, PCs

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View on Apple
Although you never know what Apple will pull out of the hat when launching new products, the last few years have been quite staid. The last “new” new Apple product was the Watch: but this was heavily trailered so, when it finally arrived, it wasn’t a surprise. We have waited in vain over the years for an Apple TV, and recently yawned when the new MacBook’s Touchbar was announced. In 2017 we have the prospect of yet another phone, the iPhone 8, and not much else.

Except, after much speculation, Apple has acknowledged for the first time that it is investing in autonomous car technology. In a letter to US transport regulators, Apple said the company was “excited about the potential of automated systems in many areas, including transportation”. Apple was first rumoured to be working on an autonomous vehicle in early 2015, when reports suggested that the company already had 600 employees working on an electric car design. Later that year, more rumours suggested that the company hoped to launch an electric car to the public by 2019.

So maybe Apple can surprise us next year. The race for electric vehicles is hotting up, and with the word being that Apple has been in talks to buy luxury-supercar maker McLaren, we may just see a prototype iCar roll onto the stage in 2017 after hearing those words, “one more thing”.
Jeremy Davies, CEO & Co-founder

Enterprise
CONTEXT will be closely tracking the evolution of storage systems and converged architecture: as cloud-managed wireless network service companies slowly but surely replace in-house wireless LAN appliances, we expect continued strong growth on these two fronts. Companies to watch: Cisco Meraki, Open-Mesh, Zebra (part of Extreme Networks), Ruckus.

Sales of solid-state drives (SSDs) have increased throughout 2016 and, for the first time, surpassed those of hard disk drives. As the price of SSDs fall and their capacity increases, 2017 will see this trend continue. In 2014, we predicted that 90% of storage components would be SSDs by 2020, and the industry is well on track to achieve this.
Gurvan Meyer, Senior Research Analyst, Enterprise Team

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Displays
Large Format Display sales in 2017 are expected to continue to grow strongly with demand being driven by the education and corporate sectors. For AV providers, the corporate business market continues to be a huge growth opportunity, with a big shift towards interactive products for meetings rooms, as corporates increasingly collaborate over multiple sites, with numerous remote attendees.  The education market is also expected to be a key driver of growth in the LFD segment with educational institutions increasingly adopting display solutions to change and enhance the ways they communicate with students, staff and visitors.
Lachlan Welsh, Senior Analyst, Displays

Imaging
Printer hardware sales will continue to contract overall, though some segments are expected to register growth in 2017, such as business inkjets with higher end products due to be released in 2017 to compete with laser devices. The shift from hardware to contract sales continues, therefore, the importance of partnerships and focus on channel partners will prevail. HP’s acquisition of Samsung printer business is expected to complete in the second half of 2017, as companies join their efforts aiming to disrupt the A3 copier market business.
Zivile Brazdziunaite, Senior Market Analyst, Imaging

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3D Printing
2017 will continue to see the two sides of 3D printing – the personal/desktop side (those under $5,000) and the industrial/professional side – evolve separately.  Desktop 3D printers will become even more affordable (some already cost as little as $300!) while the some of the world’s biggest brands will increase their presence in the Industrial/Professional market where technology will continue to advance and improve.

Desktop market leader XYZprinting has already expanded its brick-and-mortar retail presence – at Best Buy, Toys-R-Us, and Barnes and Noble in the US, and Darty, Dixons and Media Saturn in Europe – and it is expected to continue with aggressive price points in to promote further retail expansion around the globe. Next year will see HP fully enter the 3D printing world with the first shipments of their professional Multi-Jet Fusion 3D Printers, and a new business is to emerge from GE after their acquisition of two of the top five metal 3D printing companies in 2016.  HP and others will champion a change of focus in the plastics 3D printing market from rapid prototyping to mid-range production.
Chris Connery, Vice President Global Analysis and Research

VR & Gaming
The world of eSports will continue to grow in both popularity and recognition, as a movie is planned starring Will Ferrell on the burgeoning phenomenon. Vendors and retailers will pay more attention to PC gaming as the category offers them the chance to make up for losses in a sector which has been declining in the last few years. High average selling prices for gaming products, excellent attach rates and margins for gaming accessories, and the availability of unsecured consumer borrowing will be major drivers. Virtual reality will also continue to grow in the consumer space, although still at a modest pace. However we expect to see more HMDs going into the B2B and corporate reseller channels for which products such as the Hololens are a gift.
Jonathan Wagstaff, Country Manager UK & Ireland

Smart Home – Battle of the Giants
Back in October 2015 we predicted that new forms of control for smart home devices would stimulate growth in the market. We highlighted three: voice activation, gesture recognition and mind control. The first two are already here: voice control has exploded since Amazon launched the Echo in 2016 and 5 million devices have already been sold. We predict that this trend will grow quickly in 2017 with the Amazon Echo continuing to sell and the launch of Google Home in 2017. Google will apply a massive marketing budget – in the US they are already paying for end-of-gondola slots for Google Home devices.

With this in mind, we see four, and potentially five, giants battling for the smart home in 2017: Amazon, Google, Apple (with Homekit), Samsung (with Smart Things) and Microsoft. The ace up their sleeve for Amazon is entertainment (access to Prime Music), for Google it is search, for Apple and Samsung it is interoperability (potentially using the TV), and for Microsoft it is building out from the PC. We are optimistic that consumers will benefit: with a more coherent offer, small start-ups will no longer be able to create proprietary systems and existing systems will make themselves linkable to the big five in order to survive. It is too early to place bets on a winner, but Amazon has rapidly taken advantage of being first-mover. Gesture control will grow and develop in 2017, but mind control will need to wait for another year!
Adam Simon, Head of Retail

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A Sight for Sore Eyes – Technology and Eye Health

How many hours of the day do you spend in front of an LED display? Six, seven hours or maybe even longer? It will come as no surprise that our time spent in front of digital devices is increasing but does this come at a cost? In recent times, publicity surrounding the harmful effects of blue light exposure has been rising with emphatic warning cries from some medical professionals, notably opticians. It seems the technology industry is now taking notice, with a growing number of new displays containing low- or anti-blue light technology flooding the market.

Most LED display devices, including phones, tablets, laptops, monitors and TVs, project blue light. Blue light exposure at night suppresses the production of melatonin – a hormone that regulates sleep patterns – which leads to problems such as insomnia. Eye doctors have also expressed concerns about longer-term effects: the high levels of blue light people of all ages are being exposed to could eventually lead to macular degeneration.

Technological solutions that promote health have been in the industry’s peripheral vision for quite some time. According to our figures, an expanding share of monitor manufacturers’ portfolios is now given over to explaining how their eye-care technology targets harmful blue light. How quickly this phenomenon will spread to the rest of the market may depend on how much noise the medical field makes and if further regulation takes place. At present, the typical consumer may not be acutely aware of the inherent dangers of blue light and so may not take them into consideration when choosing a device.

Flickering screens – a major problem with CRT monitors in days of old – are also an issue as they can contribute significantly to eyestrain. LCD screens flicker because of the way the backlight is controlled and using what is known as pulse-width modulation (PWM) – essentially, the backlight is pulsed on and off to modulate brightness. To remedy this, manufacturers have been rolling out monitors with flicker-free technology.

Other technologies are being used to improve our overall health and well-being, so it is only fitting that a piece of the puzzle that was having the opposite effect is now catching up. Encouraged by innovation and a more educated public, manufacturers are ensuring that technology, which doesn’t harm our eyes, is now becoming more accessible.

by LW

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