View from CES 2021: Innovation in adversity

Even in the face of Covid-19, many core technology sectors did well during 2020. Expectations are that these trends will continue. The latest forecast from the US Consumer Technology Association (CTA), which organises CES, sees sales there reaching $461bn (£339bn) this year, a 4.3 per cent year-on-year increase.

In the earlier stages of the pandemic, Satya Nardella, CEO of Microsoft, observed that his company had already seen “two years’ worth of digital transformation in two months”. As a necessarily virtual CES 2021 began this week, the likely degree to which that trend has continued and looks set to stretch well into 2021 was clear.

Steve Koenig, vice-president of research at the CTA and long-time co-host of its pre-show trends briefing, cited a well-known observation by innovation-focused British economist Christopher Freeman that “innovation accelerates and bunches up during economic downturns, only to be unleashed as the economy begins to recovery.”

Already, the data points towards major pandemic-driven adoption of digital services that have quickly been tailored in innovative ways to meet the ‘new normal’.

McKinsey, the global management consultancy, previously claimed that there had been an increase in e-commerce deliveries and transactions over eight weeks that would previously have taken 10 years to achieve, partly driven by small and medium-sized bricks-and-mortar enterprises moving online.

The CTA’s data says US sales of health-monitoring devices, one of the categories most obviously driven by Covid-19, increased 73 per cent year-on-year in 2020 to $632m and will go up 34 per cent in 2021 to $845m. It expects the broader health and fitness category, including smartwatches and fitness activity trackers, to grow by 13 per cent in 2021 to reach 69 million units and by 6 per cent in revenue to $9bn.

Even mature sectors are growing. “In 2020, approximately 300 million notebooks, desktops and Chromebooks were sold,” said AMD CEO Lisa Su, during a CES keynote. “That's the highest number since 2014 - and we expect demand to be even higher in 2021, as a PC continues playing an even larger role in our daily lives.”

As for the humble old telly, displays set a record for shipments and will fall back by only 1 per cent in revenue to $22bn this year. Alongside trends to 8K resolution and supersize screens, it’s worth noting that Disney+ reached 50 million streaming subscribers in five months, where it took Netflix seven years to achieve the same.

“The point is, we haven't retreated from these positions and we haven't stood still. We've continued to move forward,” said CTA’s Koenig. ”A lot of these trends are still accelerating, even now here in 2021, and they will continue throughout the decade, really transforming the overall economy.”

There is innovation and adoption at the end-product level - but some questions remain.

For example, and staying with displays, did the need to stay at home simply bring forward a refresh cycle? Will homeworking become a long-term thing, with companies making real-estate cutbacks part of their post-pandemic recovery strategies, or are we mostly social animals that need the office, regardless of how many David Brents or Michael Scotts we share it with?

Nobody knows for sure, but the industry is making a more than hesitant gamble that the future will hold onto many of the social and structural changes seen over the last year.

A further question, though, is the extent to which Freeman’s observation looks set to hold in terms of hardware and software innovation, as well as – based on what we have seen so far – processes and end uses. The full version ends with the recovery “ushering in powerful new waves of technological change.”

AMD has been a hardware pacesetter of late. Lisa Su announced the extension of processors that use its cutting-edge Zen 3 core for ultra-thin notebooks with the AMD Ryzen 5000 series and for gaming with its new Ajax series. Perhaps more interesting still was her preview of the third generation of its Epyc server/AI/HPC family. This, Su said, will make its formal debut later this quarter.

Codenamed Milan, it reflects the fact that while in some respects use cases are catching up with available core technology, there are others where demand is pushing technology to its limits.

Speaking of datacentre clients, Su said, “While each of these customers has unique needs and requirements, they all share one thing in common: they will take as much computing power as they can get and they all want more.”

To get some idea of how much more AMD is claiming for Milan, she presented a demo of the chips running 68 per cent faster than the competition in a two 32-core processor HPC configuration on the highly demanding WRF weather research application.

Of course, CES has boosting technology’s economic and social roles among its main reasons for existing. As this year’s edition continues, it is holding some pretty solid optimism. We could all do with a bit of that right now, even if we could also – and hopefully soon will - live without what’s driving much of the industry forward.