We will state the obvious for the year with a twist…not since the last major downturn in the early ‘80s have firms in the PC, CE industry had such an opportunity to:
Do you see the differences?
Management in the first group of firms who focus on cut and retrench will circle the wagons to force short term results regardless of the long-range potential of the market segments.
Management in the second group will take the opportunity to reduce staffing back to core teams, evaluate and eliminate product lines and customers which have little or no long-term growth and strategically invest in product/service innovations that should prepare the companies for 2010 – 2012.
Industry executives are most certainly jealous of the support governments are providing to their local financial and auto industries. The problem is it is impossible for them to admit that they have run out of ideas that will correct the situation!
The first quarter of 09 will be a period of slow, careful realignment as firms see how quickly the governmental cash infusions rekindle IT and consumer confidence.
The downturn in the first half of last quarter had a positive effect for the consumer because it forced management to significantly lower prices (and profit margins) to stimulate sales. This assisted desktop/notebook computer, personal/home entertainment sales and…impacted profits.
2009 will be a period of rebuilding and consolidation. There will be quite a bit of consolidation in the computer, home entertainment, personal entertainment and Web 2.0 arenas as marginal firms either disappear completely or are acquired. The period of outlandish valuations will be replaced with more sane prices.
Investors and management who refuse to deal in the new environment will watch their companies and investments disappear into the septic tank!
The quarterly results show that consumers chose those products that satisfied the family’s need for what Faith Popcorn called cocooning back in the early 90s – Home Safe Home (assuming the mortgage can be paid).
The trend will be fed through 2009 as more public and private content is made available. Men, women and children are producing and sharing more of their own content at home and within their extended cocoons (communities). Now that more robust and global broadband is available firms that will benefit are those that can tap into these social networks and communities and from our perspective…storage providers!
Storage demand will be strong this next year at home, small/large business and in the cloud. Winning that business will not be easy for any of the storage producers or integrators.
Hollering that you are cheaper will get people’s attention but it will not win the business.
Offering better, more advanced technology may interest our kid but folks with the money don’t want to be bothered with intricate technology.
Organizations that can deliver products/solutions that really have honest and easy user interfaces and brain-dead integration will be far more successful than companies that compete solely on price.
Why will personal and family storage grow in the year and years ahead?
The average total storage in and around the home will increase to more than 2TB by the end of next year and will increase to nearly 8TB by 2012.
The demand will swell for personal on-the-go storage and centralized save-it storage because people everywhere will be gathering up and sharing…content!
Audio entertainment materials will come from all of the usual prospects/suspects.
Personal and family content will grow from photos taken with digital cameras and camphones.
Video – really bulky highdef stuff — will grow captured with cameras, camcorders, camphones, TV captures, Web 2.0 gotta-have grabs, rent/rip/return discs.
Some – ok most – will never see the light of day once it is captured/stored. But increasingly people will want to do stuff with it, modify it, customize it, tailor it and make it his or her content. Then they’ll want to share it.
A slight side note here because we’ll see a major increase with the cocooning individuals and families in wanting software and solutions that will enable them to personalize, privatize that content.
The new users won’t be the usual pros, semipros, tweekers ‘n twitterers.
These folks will probably have had a really rough day at the office, at school or handling the other household members without doing them great bodily harm. Working with, struggling with content preparation solutions will be extremely low on their “gotta do” list!
The successful providers will be organizations – hardware, software or combo firms – that not only deliver elegant, easy-to-use, almost automatic interface/workflow solutions. Winning companies will step outside the industry’s old-fashioned comfort zone by doing more than delivering pretty-good software and Bangladesh Jim support.
Before the Cloud
While CDN (content delivery network) providers proclaim that home storage – HD, flash, optical – will become almost meaningless by the end of 2009 they tend to overlook the facts that:
The more content people have, the more they want and usually in multiple formats.
This coming year it is estimated that more than 100 EB of storage — flash, HD, optical — will be shipped for CE applications.
Winning won’t be based on technology or on price but on making it easy and safe for people and families to store their content!
It’s dark, gloomy outside.
There is thunder and lightning all around the family’s castle.
In times like these people want their content – audio, video, photo – to use, to enjoy, to drown out the outside uncertainty.
Treat them gently…treat them right…treat them fairly…you’ll have a loyal customer even after the storm passes.
If you don’t do that…it will be a tough air conditioned flight to your next destination.