We're starting our annual trek out to the Consumer Electronics Show in Las Vegas today to get a sense of the latest trends that will have an impact on the tech investing world for the next year. In the coming days, we'll have plenty more on what we see there, but leading up to the show, the endless hype from public-relations firms and media outlets has been flowing in for weeks.
Tech is, of course, notorious for the level of hype it manages to generate. As I wrote a few weeks ago, the hottest, most hyped IPOs have recently been in the tech field. Sometimes tech hype is justified. Smartphones and the Internet have changed the way we interact with the world, and companies such as Microsoft (MSFT), Apple (AAPL), and Google (GOOG) have real sustainable advantages and cash flows.
But the hype is more often just that. CES is particularly littered with ghosts of vaporware, announced products or ideas that never actually see the light of day. This year will be no exception. Here are four ideas that are already being talked about ad nauseam as big trends for 2012 that could very well end up being nothing more than mirages in the Vegas dessert.
Ubiquitous 3-D TVs
This one has been knocking around for a few years now, and the big TV manufactures are trying again to convince consumers that now is the time to swap out their existing flat-panel TVs for 3-D models. The problem is no one seems to feel like the upgrade is worthwhile. There isn't much content available for these TVs, there is no good way to get the content, the TVs still have a decent price premium, and frankly people don't want to sit in front of their TVs while wearing 3-D glasses all night.
Now it is easy to see why TV manufactures would want to make this technology happen. It was relatively easy to convince people to ditch their giant tube TVs and replace them with sleek flat panels. Then as prices on the panels plummeted the adoption rate sped up even more, and now almost everyone who can afford it has swapped to a new TV. But now that this upgrade cycle is basically complete, the manufactures need to convince households that 3-D is worth doing it all over again. They almost certainly won't be able to do so. As TVs naturally wear out, 3-D models will work their way into living rooms. But it isn't going to be the bonanza the industry might want you to believe.
4G
Faster network speeds have been the big buzz in the wireless sector, but 4G networks aren't ready for prime time yet. The first issue is network rollout. Although the major wireless players have been rolling out 4G networks, the coverage remains limited to major metropolitan areas. There are still huge swaths of the country with no coverage.
And while we will see many new 4G handsets rolled out this week, there are still precious few devices that can connect to the faster networks. Furthermore, the ones that exist are still very expensive, have almost comically bad battery life when on 4G networks, and have expensive data plans with hard caps on usage. When the networks and technologies become mature, consumers will move over to the new networks. But don't expect that switch to happen in 2012.
iPad Killers
The iPad has quickly proved that there is a big market for tablets. Non-Apple companies have been scrambling to come up with a credible competitor. So far, no one has been able to truly pull it off. Motorola Mobility (MMI) and Research in Motion (RIMM) launched their competitors last year to some fanfare but to almost no sales.
Amazon.com (AMZN) has come the closest with its Kindle Fire. But that product is still in its infancy, and it might need a few more iterations before it has the power to complete with the larger, more powerful iPad. The excitement about the Fire does prove that there is a big market for a reasonably priced tablet not made by Apple.
This year we expect to see a parade of new Android-powered tablets, the first hints of Windows 8 devices, and the next generation of BlackBerry devices looking to take meaningful market share. Each of these new devices will be lauded (by the maker, at least) as an iPad killer. It just isn't true. Android doesn't yet have many tablet apps, and many of the new devices are underpowered, overpriced, or both.
Just like the smartphone market, there will likely be several big players in the tablet space over the long term. However, from what's been leaked so far, none of the offerings on tap at CES looks like it is going to make a significant impact.
Ultrabooks
PC notebook sales haven't been all that exciting recently. Consumers see them as mostly interchangeable, and demand has remained fairly weak. Apple has been the only major maker to see sales rise appreciably. Much of that rise is attributed to the success of the firm's MacBook Air line. The thin, fast-booting computer with good battery life has been a hit, particularly after the price was dropped from the stratosphere. Intel (INTC) now wants to try and create that kind of excitement for PCs. The chipmaker has created an "Ultrabook" standard that will combine Intel's latest processers and a solid state hard drive in a slick package. Many of these new machines are expected to be rolled out this week.
Intel obviously wants to sell more processers, so it is clear why the firm is trying to prod the PC manufacturers to up their game, but this is far from a slam dunk. Apple has seen a lot of success not just because of its product, but because of its marketing prowess. Heavily trafficked stores and only a handful of notebook products makes it easy to build brand awareness of new products. However, with multiple manufacturing partners each making a product with divergent specs, Intel and other non-Apple firms could face challenges in convincing consumers and businesses that there really is something new in the marketplace. Many of these new machines might be gorgeous, but can they find a market?
What do you think? Are these just hyped-up ideas, or will they end up driving the picture in 2012? What do you think will be the biggest tech trends of the year? How are you thinking about investing in the tech sector?
Bearish markets editor Bearemy Glaser is the worry-prone alter-ego of markets editor Jeremy Glaser. Each week, Bearemy shares what's topping his list of concerns and invtes you to add your own in the comments section below.
