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How Drones, Wearables and VR Are Driving the Tech Economy

Kelsey Pommer, Manager, Digital Media, Consumer Technology Association (CTA)
Emerging technology and an enthusiasm for all things connected will drive the U.S. consumer tech industry to $286.6 billion in retail revenues in 2016. Although the five largest categories of the industry are more traditional tech (such as smartphones LCD TVs and tablets), these emerging categories are pushing the tech industry forward:

4K Ultra High-Definition (4K UHD) ecosystem: 2016 will be a flagship year for 4K UHD TVs, driven in part by the market introduction of next-generation technologies like HDR. Consumer Technology Association (CTA) expects shipments of 4K UHD displays will reach 15 million units (a 105 percent increase) and revenue will exceed $12.9 billion (a 69 percent increase). New to the market in 2016, 4K UHD Blu-ray players will further build the 4K UHD ecosystem, with 700,000 units sold and $63 million in revenue.

Wearables: Driven by the popularity of fitness activity trackers, unit sales of all wearables in 2016 are forecast to reach almost 48 million units (a 39 percent increase). Fitness activity tracker volumes will hit 28 million units in 2016 (a 60 percent increase from 2015)  with revenues reaching $2.2 billion (a 62 percent increase from 2015). After a year of strong growth, smartwatch unit growth is slowing while revenue will decline for the first time. Unit sales are expected to increase 15 percent to 12.2 million units, earning $2.8 billion in revenue, a decline of 8 percent.

Smart home: CTA projects the smart home category — including smart thermostats, smart smoke and CO2 detectors, IP/Wi-Fi cameras, smart locks, smart home systems, and smart switches, dimmers and outlets — will reach 9.5 million units sold in 2016 (a 29 percent increase). Revenue will grow to $1.3 billion (a 24 percent jump).

Drones: Drone sales are expected to reach record heights, topping 2.4 million units (up 112 percent from 2015) and $799 million in shipment revenues (an 80 percent increase from 2015).

Virtual reality (VR): With several global tech leaders introducing VR headsets to the consumer market in 2016, CTA expects this to be the tech sector’s overwhelming leader in year-to-year growth. Unit sales will increase by 296 percent over last year, reaching 800,000 units sold. Total revenues are projected to reach $432 million, a 332 percent increase this year.

Digital assistant devices: This is the first year CTA’s semiannual report includes projections for voice-activated devices that provide a cloud-based, artificial intelligence-powered virtual assistant, such as Amazon’s Echo. Sales are projected to reach 2.2 million units (up 32 percent) in 2016 and earn $392 million in revenue (increasing 32 percent).

3D printing: Ever-expanding 3D-printing capabilities will drive the sector’s unit sales growth to increase 56 percent from last year, to reach 171,000 units sold. Total revenues will reach $148 million, a 35 percent increase.

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