Document Sample
Contact:              Jeff Joseph                 or                Becca Hatton
                      tel: (703) 907-7664                           tel: (703) 907-4355
                      e-mail:                        e-mail:


                                     2005 Growth at 11 Percent

       Arlington, Va., August 14, 2006 –The Consumer Electronics Association (CEA®) forecasts
total CE factory-to-dealer sales to reach $140 billion in 2006, an eight percent growth over 2005, as
shown in figures released today by CEA in its semi-annual U.S. Consumer Electronics Sales and
Forecasts Report. According to CEA Market Research, final year-end totals reached $128 billion in
2005, making 11 percent growth over 2004.

        “The mid-year numbers show continued robust growth in the CE industry, category to
category,” said CEA President and CEO Gary Shapiro. “Consumers are embracing new
technologies in this digital age, as they make new or upgrade purchases for the home, the car, the
office or anywhere.”

       Display technologies continue to be the front runner in the CE industry with revenues
reaching $19 billion in 2005 and expected to exceed $22 billion in 2006.

        “Replacement and upgrade purchases continue to drive the display market while prices
continue to fall,” said CEA Director of Industry Analysis Sean Wargo. “As consumers prepare for
the transition to digital television, we will see more of the shipment volumes move to digital
displays as analog sets‟ days are increasingly numbered.”

        CEA projects the DVD market is poised for resurgence over the coming years as two newer
technologies, DVD recorders and high-definition DVD, become widely available. CEA figures
show DVD recorder prices have declined significantly, with the average price less than $100, with
shipments expected to exceed seven million units this year. High resolution DVD players in both
Blu-ray and HD-DVD formats entered in the market place this year. Initial product delays have
forced reduced volumes, but shipments of home component models should reach more than one
million units in 2007.

       “MP3 players remain the shining star in the audio market, forecasted to ship 33 million units
in 2006 and reach five billion dollars in sales. Additionally, one of the biggest benefactors from the
MP3 „craze‟ is the accessories market. Headphones, docks, speakers and carrying cases, are
expected to grow 30 percent this year,” said Wargo.
        The video gaming category will truly begin to reap the benefits of the new generation of
consoles in late 2006, with the maturation of the Xbox 360 and the release of Sony‟s Playstation 3
and Nintendo‟s Wii. CEA forecasts total gaming shipments, including both hardware and software,
will reach $12.5 billion this year. Growth will continue through 2007 with total sales expected to
exceed 2006 figures by 16 percent.

       “The fourth quarter of this year is when things really heat up in the gaming market, with
continued growth expected through 2007, reaching $15 billion,” said Wargo.

       Fueled by rising shipments of portable navigation products, 2006 revenues in the mobile
video and navigation category are expected to top $2.3 billion – 21 percent higher than CEA
previously forecasted in the January edition of the Sales and Forecasts Report. Navigation products
were responsible for over half of that total growth.

        New to the Forecast Report is an economic overview, in which CEA economists state that
the technology sector continues to look extremely healthy. Consumer spending remains strong and
inflation remains even, they note, counterbalancing consumer budget reallocation due to higher fuel
costs and a deteriorating employment market.

       “U.S. Consumer Electronics Sales and Forecasts 2002-2007” (July 2006) is published twice
per year, in January and July. It was designed and formulated by CEA Market Research, the most
comprehensive source of sales data, forecasts, consumer research and historical trends for the
consumer electronics industry. Please source any information cited to the Consumer Electronics
Association (CEA®). The complete report is available free to CEA member companies. Non-
members may purchase the study for $499 at

About CEA:
          The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the
consumer technology industry through technology policy, events, research, promotion and the fostering of business and
strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development,
manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications,
information technology, digital imaging, home networking, multimedia and accessory products, as well as related
services that are sold through consumer channels. Combined, CEA's members account for more than $125 billion in
annual sales. CEA's resources are available online at, the definitive source for information about the
consumer electronics industry.
          CEA also sponsors and manages the International CES – Defining Tomorrow‟s Technology. All profits from
CES are reinvested into industry services, including technical training and education, industry promotion, engineering
standards development, market research and legislative advocacy.

  CEA Industry Forum                                            CONNECTIONS™ Europe: Strategies for Digital
    October 16-18, 2006, San Francisco, CA                        Living Markets
  New York Press Preview                                         November 14-16, 2006, Berlin, Germany
    November 8, 2006, New York, NY                               CES Unveiled: The Official Press Event of the
  CES Unveiled@NY                                                International CES
    November 8, 2006, New York, NY                                January 6, 2007, Las Vegas, NV
                                                                 2007 International CES
                                                                  January 8-11, 2007, Las Vegas, NV
I:\RELEASES\Market Research\2006 mid year forecasts.doc

                                                          - more -