Key Themes at CES 2017

360-Degree Cameras, Smart Speakers, Virtual and Augmented Reality to the Fore


Machine learning will overtake the Internet of things as a hot investment area in 2017

Manufacturer to unveil a smartphone with an integrated 360-degree camera

Sales of smart analogue watches will outstrip those of Apple and Android-powered devices in 2018

By 2018, smart sports shoes will sell 1 million pairs to become the first mass-market smart clothing

London, 3 January 2017: In anticipation of CES 2017, and as the biggest consumer electronics companies in the world prepare to unveil their latest new products, CCS Insight provides some expectations, key themes and predictions for the show.

Machine Learning and Artificial Intelligence

The Internet of things has been a key buzz phrase at the CES event for the past two years. This year we believe that attention will shift to machine learning and artificial intelligence, which will become prominent themes throughout the event. We predict that machine learning will overtake the Internet of things as a hot investment area in 2017. The huge potential of machine learning and artificial intelligence will see numerous companies focusing on this space at CES.

Smart Speakers

We expect to see a wide range of smart speakers showcased at the show. These will build on the progress seen in 2016 with the launch of Amazon's Echo and Google's Home devices. Martin Garner, Senior Vice President at CCS Insight, cautions that "success in the smart speaker market will be determined by the software platform, not the hardware". In his view, the real battleground will be support for competing voice control systems such as Amazon's Alexa, Google's Assistant and Microsoft's Cortana, rather than any hardware differences.

CCS Insight believes that smart speakers will kick-start the connected home market in 2017. The arrival of smart assistants like Amazon's Echo and Google Home are expected to rekindle public interest in connected home devices and there will be a wealth of demonstrations at CES showcasing how people can control smart thermostats, light bulbs and other devices using the speakers' intuitive natural language interfaces.

Virtual and Augmented Reality

Virtual and augmented reality technologies are poised to be major themes at CES. Companies targeting this opportunity need to build momentum after a slower than expected start in 2016. Expect numerous demonstrations at press conferences and on the exhibition floors, with long lines of attendees at dedicated showcases trying out the latest experiences.

While virtual reality has primarily gravitated toward consumer applications, augmented reality is clearly seeking enterprise opportunities. We expect a number of announcements in this area from big companies as the technology improves and viable uses emerge.

360-Degree Cameras

Reflecting the growing interest in virtual reality and the ease with which 360-degree content can be shared on sites such as Facebook and YouTube, we expect to see an avalanche of 360-degree cameras, particularly from the numerous Shenzhen-based companies attending CES. We also expect to see one manufacturer unveil a smartphone with an integrated 360-degree camera. This opportunist move is likely to feature a smartphone with a dual fisheye lens to capture "surroundie" pictures. If such a product appears it has the potential to be a big news story at CES. However, once the dust settles we believe it'll remain a curiosity in a smartphone market which is still currently characterised by a lack of innovation.

Wearables

Wearables have been a hot topic at CES over the past couple of years. However, CCS Insight's recently completed wearables survey indicates challenges remain for manufacturers targeting this segment. Full-touch smartwatches still lack a clear purpose and remain a solution looking for a problem.

On this basis, we believe that there will be a larger number of smart analogue watches on show at CES and that sales of smart analogue watches will outstrip those of Apple and Android-powered devices in 2018 as the appeal of touch-screen smartwatches with full electronic displays wanes. Look out for big announcements from leading watchmakers such as Fossil.

Other notable areas to watch in the wearables space include pet trackers; we predict major pet food brands will give away fitness trackers for cats and dogs in 2017. Pet food suppliers will create online tracking programmes for pets like those offered by Fitbit and others for their owners. We'll be keeping a close eye out for the latest designs in pet trackers in support of this trend.

Another trend we expect is the appearance of wearables in a variety of new designs and shapes. We believe smart shoes have significant potential and expect to see further examples at CES that build on the announcements made by Under Armour at International CES 2016. This supports our prediction that by 2018 smart sports shoes will sell 1 million pairs to become the first mass-market smart clothing.

Automotive

Over the past five years the automotive exhibits at CES have continued to grow. This year the hype around autonomous vehicles will continue to build, yet we caution that this technology will take far longer to come to fruition than many of the flashy demos at CES suggest. We predict that autonomous cars with no human driver remain a research project until at least 2025. This is based on our view that despite extensive hype, the problems of legislation, regulation, safety and consumer acceptance mean fully software-controlled cars on public roads will stay in the realms of science fiction until well into the next decade.

This is not to say that self-driving technology won't continue to make progress in areas such as driver-assistance projects, which we believe will be very prominent at CES. The challenge is that regulatory approval will advance far more slowly than the technology and we expect this to be a hot topic for debate.

Notes to Editors

A team of CCS Insight analysts will be attending CES 2017. Feel free to contact them before and during the show for independent commentary and analysis.

On site in Las Vegas:

Geoff Blaber (VP Research, Americas): mobile devices, semiconductors, US market.
+1 408 886 1745
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@geoffblaber

Martin Garner (SVP, Internet): Web companies, Internet of things, connected home.
+44 7887 571496
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@martin_garner

George Jijiashvili (Analyst): wearable devices, virtual reality, augmented reality.
+44 7828 974001
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@george_ccs

In the UK:

Ben Wood (Chief of Research): all connected devices (smartphones, wearables, VR and AR) and other topics.
+44 7767 886666
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@benwood

Kester Mann (Principal Analyst): network operators and carriers.
+44 7702 942000
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@kestermann

Paolo Pescatore (Director, Multiplay and Media): TV, media, content, multiplay services.
+44 7824 858585
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@paolopescatore

About CCS Insight

CCS Insight is a global analyst company focussing on mobile communications and the Internet. It provides comprehensive services that are tailored to meet the needs of individual clients, helping them make sense of the connected world. Follow @CCSInsight on Twitter or learn more at www.ccsinsight.com.

For further information contact:
Hollie Bridgland
Harvard PR
Tel: +44 20 7861 2842
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