avzombie.com

Despite my dour demeanor I try hard to be a ‘cup-half-full’ sort of guy. But the grim reality of the current economic choke-hold could clearly be felt in the latest set of financial reports delivered by the world’s biggest consumer electronics companies. All confirmed that a slowing demand for everything from screens to semiconductors, not to mention the strong yen, were demolishing their earnings. Red flowed like spilt wine across the financial papers.
When Sir Howard Stringer’s troupe announced a 90 per cent fall in quarterly profit, commentators gasped. Operating income in Sony’s electronics division plunged like necklines on Strictly Come Dancing. Only the seemingly invincible Nintendo significantly grew its business. Currently ranked as Japan’s sixth-most valuable listed company, ahead of Canon, Panasonic and Sony, Ninty recently posted a stonking 36 per cent jump in quarterly operating profit, thanks to ongoing demand for its Wii console and DS handheld. As a token gesture to the global crunch, it cut its operating profit forecast, before heading out into the Osaka night for a big party.

Ironically, these numbers all emerged even as the majors unveiled significant technologies and concepts that should see them power ahead over the next five years.
Unfortunately, I have the nagging suspicion that we’re destined to see at least one high profile exit from the UK consumer electronics market over the next twelve months. Naturally I hope I’m very wrong (and it must be said that I have a rubbish track record in such matters, having bought Betamax and backed HD DVD), but the omens don’t look so good.
Thankfully, there are those who predict that the credit crunch could actually be good news for all of us in the AV business. London-based market research firm FutureSource argues that consumers will opt for ‘stay-cations’ rather than vacations, and invest in new home entertainment systems to keep them entertained in the cold, dark nights ahead. FutureSource predicts that Blu-ray sales will triple over the next 12 months, bringing the total number of players shipped into the UK to 1.8 million. And that doesn’t include PS3s. And more BD player sales should translate to ongoing demand for quality big screens, new AVRs, associated speaker systems and even projectors. ‘In times of economic hardship, we’ve seen consumer electronics and in-home entertainment weather the storm,” says director Sarah Carroll.  “Sales of VCRs jumped by 440 per cent during the Eighties recession.’
I like her thinking. Let’s raise a glass of sparkling Perry and toast a swift return to the good old days, before having a quick workout on Wii Fit to celebrate.