Phablets and wearables to hit prime time in 2014: Deloitte

Phablets and wearables to hit prime time in 2014: Deloitte

Deloitte releases 2014 Global Technology Media and Telecommunications predictions report

More than 20 per cent of Australian adults will own a wearable electronic device by August, and phablets are set to outsell tablets, according to the 13th Deloitte Global Technology Media and Telecommunications predictions report.

Deloitte Australia’s TMT leader Stuart Johnston said smartphones were projected to generate US$375 billion in revenue in 2014, and were nearing saturation among most age groups except the 55+ demographic, which will grow usage by 25 per cent this year.

“While we expect to see a plateauing of the device sales (smartphones and the connected living room), we do not expect to see a corresponding decline in the overall spend on personal entertainment,” he said.

“Rather, we will see a shift in the share of wallet, with the money that is not being spent on new physical devices, being spent on software, apps and games etc, as well as media and data plans.”

The report also predicts phablets - an oversized smartphone that’s part phone, part tablet - will outsell tablets by US$25 billion.

Johnston said Phablets had already absorbed 25 per cent of the smart phone market.

“In our region we expect phablets to out-ship tablets and TVs into Asia this year given the Asian appetite for gaming and video viewing on smartphones,” he said.

“The larger phablet screen is much more attractive than the small screen for video games.

“Further, texting in native languages such as Mandarin, Arabic and Hindi, is easier on the larger phablet.”

While there has been much uncertainty around wearables, Johnston predicts 2014 to bring US$3 billion in sales of glasses, watches and fitness bands.

“In Australia alone we anticipate 20 per cent of 17-75 year olds will own a wearable by August this year,” he said.

“It is an interesting trend, but wearables will not replace smartphones,” he said.

“In fact the majority of wearable devices require smartphone tethering for connectivity, GPS etc.

“In reality, data viewing capabilities are limited on wearables, and a second screen is required for rich data viewing and manipulation, so they are an extension to the digital ecosystem, not a substitution.

He said the enterprise application of wearables was likely to be one of the untold stories of 2014.

“There are many opportunities for applying wearables to improve safety and efficiency, by providing quicker and safer access to data,” he said.

“Johnston said a recent trial of Google Glass by police in a US town saw an 80 per cent drop in accusations of police brutality, and a drop in cases of excessive use of force by police.”

Another expected development in 2014, is that mobile instant messaging services, like ‘WhatsApp’, will generate about 70 per cent of all messages sent from mobile phones, but deliver only about three percent of the value to the telecoms industry.

Although 70 billion messages will be sent via mobile every day, only 21 billion will be via SMS. SMS will generate revenues of about US$100 billion this year, compared to just US$2 billion for mobile IM services.

According to Deloitte, Global sales of smartphones, tablets, PCs, TV sets and videogame consoles will exceed US$750 billion in 2014, up US$50 billion from 2013 and almost double the 2007 total.

However a sales plateau appears likely.

Sales are expected to continue growing, but at a slower rate than over the past 10 years, with an estimated ceiling of about US$800 billion per year.

By the end of 2014 almost 50 million homes around the world will have two or more separate pay-television subscriptions, with the additional subscriptions generating about US$5 billion in revenues.

A further 10 million homes will receive premium programming as part of their subscription to another service, such as broadband.

The value of premium sports broadcast rights is set to skyrocket to US$24.2 billion, a 14 per rise on 2013, equivalent to an additional US$2.9 billion.

This increase in rights fees will be driven by new agreements with certain top tier European domestic football leagues and major North American sports leagues.

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Tags 13th Deloitte Global Technology Media and Telecommunications predictionsDeloitte Australia’s TMT leader Stuart Johnston

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