Tech spending 'will fall in 2014'

Global spending on technology will slip 1% this year to 1.06 trillion dollars (£646bn) as the lower average selling price of smartphones and tablets offsets unit growth in markets like China, experts say.

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Phil Molyneux, president and CEO of Sony Electronics, introduces the new Xperia Z smartphone at the International Consumer Electronics Show in Las Vegas. (AP)

Global spending on technology will slip 1% this year to 1.06 trillion dollars (£646bn) as the lower average selling price of smartphones and tablets offsets unit growth in markets like China, experts say.

The decline is off the peak of 1.07 trillion dollars (£652bn) estimated this year.

Steve Koenig, the The Consumer Electronics Association's director of industry analysis, issued the forecast at the opening of the annual International CES gadget show in Las Vegas.

The retreat does not reflect less consumer appetite for what Mr Koenig called the "dynamic duo" of tech gadgets. Spending on smartphones and tablets is still expected to account for around 26p of every pound spent on technology this year.

But the average price of smartphones, for example, will fall from £270 in 2010 to an estimated £181 this year, despite the number sold rising to 1.21 billion, up from 1.01 billion.

"These lower-end devices are what's required to penetrate most deeply into these emerging markets," Mr Koenig said.

Smartphones and tablets remain such key drivers of technology spending that they are eating into other categories of devices like point-and-shoot cameras, video cameras, portable GPS devices and handheld gaming devices.

But within other categories of devices there are a few pockets of growth, including wearable devices.

Smartwatch sales are expected to be 1.5 million units globally this year, up from 1 million in 2013, said Shawn DuBravac, the association's chief economist.

"This is a very nascent market. We're still looking for that killer application for that particular device," he said.

Ultra HD televisions, which roughly quadruple the number of pixels of a high-definition set, are also seen taking off.

There were 60,000 such sets sold in the US alone last year, a number expected to hit 485,000 this year, the association said. But that is still a small number compared with the nearly 40 million TVs sold in the US each year, Mr DuBravac said.

AP