Consumer electronics industry growth would be stalled this year and next, driven by heightened data security concerns, falling demand for smartphones and tablet PCs, and stagnant growth in the IoT, a new Accenture survey revealed.
A poll of 28,000 consumers across 28 countries, found that for nearly half of respondents believe security concerns and privacy risks are the top three barriers to buying an IoT device and service.
Of the survey respondents who indicated they either own or plan to buy an IoT device this year, nearly three-quarters said they know that these products are capable of being hacked and therefore can result in stolen data or device malfunctions.
Within the groups of IoT device owners or those planning to buy one in the next year, 37 percent decided to be more cautious when using these devices and services, while 24 percent chose to postpone buying an IoT device or subscribing to an IoT service.
Furthermore, 18 percent quit using their IoT devices or terminated their IoT services until they can get safer guarantees.
The survey further revealed sluggish demand for traditional consumer technology devices such as smartphones.
48 percent of respondents said they intend to buy a smartphone this year, down six points from the 54 percent who said they planned to buy one last year.
Similarly, the number of people who said they plan to buy a new TV or a tablet PC this year – 30 percent and 29 percent, respectively – also dropped from 38 percent last year for both device types.
“The slowdown in the consumer technology market is irrefutable, serious and global,” said Sami Luukkonen, global managing director for Accenture’s Electronics and High Tech group.
“The market is not about the glitzy gadgets anymore – rather, it’s about providing secure, innovative and practical digital services and more open collaboration.”
As device demand tapers off, Luukkonen suggested that the industry needs to make a sharp turn toward providing innovative, value-added services that consumers are able to use with confidence.
The survey also revealed lackluster demand for IoT device markets, which the industry has been counting on to drive growth as other device markets such as smartphones mature.
Only 13 percent of respondents said they plan to purchase a smartwatch in the next year, up only 1 percentage point from last year.
The survey found similar stagnation in demand for a range of devices, including fitness monitors, wearable health devices, smart thermostats and connected home-surveillance cameras .
“Despite all its promise, the Internet of Things market has revealed itself to be a double-edged sword,” Luukkonen said. “The market opportunity is enormous, but security and ease-of-use concerns are hindering its near- and long-term potential.