Czech Republic Consumer Electronics Report Q2 2012

The Czech Republic’s consumer electronics devices market, defined as the addressable market for computing devices, mobile handsets and video, audio and gaming products, is projected at US$4.7bn in 2012. Following a modest recovery in spending in 2010-2011, demand is forecast to increase at a 2012- 2016 CAGR of 4.8% to US$5.4bn by 2016. The main drivers are the growing popularity of feature-rich digital lifestyle products such as flat-screen digital TV sets, notebook computers and digital cameras, as well as rising incomes and lower prices.

In 2012, BMI forecasts single-digit consumer electronics market growth in a context of continued weakness in Czech consumer spending. In 2011, with a recovery in consumer spending elusive, stronger sales of smartphones provided a bright spot and helped to lift the consumer electronics market in H212.

The savings rate in the Czech Republic remains high, but real wages have yet to make a convincing comeback.

The main consumer electronics growth drivers will be rising incomes, lower prices and the growing popularity of feature-rich digital lifestyle products such as flat-screen digital TV sets, notebook computers and digital cameras. A digital TV broadcasting signal is now available to more than 50% of Czech households, while growing fixed and mobile broadband penetration will fuel demand for netbook computers and high-end handsets.

Computers Computer hardware accounted for around 49% of Czech consumer electronics spending in 2011 and will continue to be the largest product category. BMI forecasts Czech domestic market computer hardware sales, including notebooks and accessories, to be US$2.1bn in 2012, with low singledigit growth from 2011. Computer hardware CAGR for the 2012-2016 period is forecast at about 6.4%, driven by demand for wireless-equipped notebooks and tablets.AV devices accounted for around 36% of Czech consumer electronics spending in 2011. The Czech Republic’s addressable AV device market is estimated at US$1.6bn in 2012. Despite recent negative growth due to price erosion, a CAGR of 3% is projected for 2012-2016, due largely to continued growth in the digital TV set category and a 2011 analogue switch-off date. In Central Bohemia, a survey found that 74% of households had switched to digital broadcasting ahead of the transition date of October 31 2009.

Handsets Mobile handset sales accounted for around 15% of Czech consumer electronics spending in 2011. Czech market handset sales are expected to grow at a CAGR of 4.8% to US$981mn in 2016, as mobile subscriber penetration reaches 132%. Smartphones are expected to account for around 42% of handset sales in 2012. Operators are looking to drive postpaid subscriptions by offering smartphones with Android models, accounting for around 20% of smartphones currently in use.