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I dodged the snowflakes and made the trek out to Sin City for this year’s Consumer Electronics Show (CES). Although attendance was down, it is still an insanely large audience of 130,000 attendees and 2,700 companies. Consumer Electronics Association head Gary Shapiro reported in his keynote that industry sales were up over 5% and that 2009 will be flat or slightly down. Not bad if true. His speech, by the way, was as much a political speech as it was an industry overview, further underscoring the importance of government activities in business affairs in the coming years. Two areas he hammered on were immigration policy (“expand H1B visas”) and shooting down the ridiculous union-sponsored “card check” law (every large company business leader I have spoken to in the last 6 months is apoplectic over this bill and views it as a litmus test for Obama’s centrist economic policies).
Tom Hanks appeared with Sony CEO Howard Stringer to pump Sony products and were very funny. But by far the funniest line of the day was heard from the very dour and serious head of Intel Capital. Seeking to assuage the nervous entrepreneurs amongst the portfolio companies that were in attendance at his networking lunch reception, he assured them, "We [Intel Capital] intend to continue forward and be very supportive of your down rounds this year." Ouch. He was probably just grumpy from the miserable results Intel announced to Wall Street the day before, with an unheard of 23% forecasted drop in revenue. That wasn't so funny.
Also not so funny were the general buzz and complaints bemoaning the lack of innovation. The next generation of flat screen displays and Blu Ray devices just isn't that exciting any more. Further, I was shocked at how empty the casinos were. I can see why the casino moguls are sweating it right now. The consumer electronics industry may be in for a stagnant year, but coming off a record year that would be a victory. But one look at all the frozen cranes up and down the strip is all you need to know that Sin City is in for a tough run in 2009 and 2010. But Intel Capital will be happy to invest in their down rounds.